Tabcorp Rebrands Powerball to Attract Younger Punters
Powerball’s new ad campaign focuses on growth customers, generally younger than the longtime lottery punters.
Tabcorp’s rebranded Powerball last month and the changes worked in the short term. Company shares, which had a downturn earlier in the year, increased in recent weeks since it announced the rebrand. Tabcorp shares moved 1.2% in trading this week.
Tabcorp sought to boost sales among the younger generation, because millennial punters do not play the lottery as much as previous generations.
The strategy for bigger jackpots worked, since Powerball had its record draw of $107 million on January 19. The jackpot was the largest in Australian lottery history. The record prize broke its own record, because Powerball organized a $100 million draw in 2018.
Company shares declined early in the year, despite the buzz created by the record draws. Therefore, Tabcorp decided to rebrand the Powerball to appeal to a younger demographic.
Colmar Brunton and Carat
Thus, Tabcorp worked with the Colmar Brunton market research agency and Carat, its media agency, on a new campaign. The ad campaign launched in mid-March and showed results in the weeks since.
Ben Johnson, Tabcorp’s Head of Brand for Lotteries, told CMO in a recent interview, “We’ve always built around the essence of freedom, and giving someone the chance to live an extraordinary life.”
“Jackpot offers were great at the time of our launch — up to $50 million. This helped us retain players, but what we found was it was mostly existing players. The [old] campaign wasn’t good at attracting new audiences, which we needed in order to grow.”
Changes to Powerball Lotteries
Tabcorp announced changes to the Powerball draws on April 13, 2018, attempting to spur sales. It lowers the odds of winning a prize from 1-in-78 to 1-in-44. As an offset, Powerball increased its ticket price by $0.25.
Powerball also contains more winning numbers now, which it draws from the numbers 1 through 35. The Powerball number remains the same as before, with organizers drawing from a barrel of 20 balls. Tabcorp calls the new prize class “Division 9”.
Division 9 rules allow a player to win a small prize by matching only one number, if it is the Powerball number. Lotto punters gave mixed reviews of the new Powerball rules, because many viewed Division 9 as creating small prizes. Critics saw the small prizes as meaningless, similar to pokies wins that don’t cover the cost of the bet.
Most importantly, Powerball weighted the system to create bigger jackpots. The company follows a trend used by top lotteries around the world, including the massive Powerball and Mega Millions lotteries in the United States. The minimum guaranteed 1st prize is $3 million, but draws now reach the $100 million range.
The huge $107 million jackpot earlier this year boosted sales in recent months.
Retained, Growth, and Churn
Tabcorp focused on three segments of its potential customer base: Retained, Growth, and Churn. Retained consists of consumers age 49 and above, while Growth is those between 25 and 49. Churn consists of customers who bought tickets in the past, but are not regular buyers.
Ben Johnson suggested the bigger jackpots are a long term strategy which dovetails with the current ad campaign. He added, “We knew churn was a long-term game, so we parked that initially. It was also important with our retained audience to keep them in love with the brand. But the growth audience is the big opportunity for us. We want to make them fall in love with brand lotteries, and particularly Powerball, but they have been hard to target in the past.”
The marketing team decided they were marketing to lotto punters the wrong way. Instead of telling punters a lottery win would give them the means to buy new things or travel, the campaign now describes how their lifepath will change.
“The insight we drew on for our brand refresh was that winning Powerball wasn’t about what you could buy, but who you could be. People had this desire to be someone else but were constrained by social norms and financials means to do it. Inside of everyone was this version of themselves hoping to get out,” said Tabcorp’s Head of Brand for Lotteries.