I visited the offices of National Lottery plc at the Portomaso Tower, to meet with Chief Commercial Officer, Mr. Franco De Gabriele, to get a first glimpse of what the company is preparing for the upcoming launch of the national lottery of Malta on July 5th, 2022. From a mile away one could sense a great sense of energy, pride, and dedication to the task at hand. There is no secret that this is a monumental project that will see for the first time a wholly owned Maltese company operating what is essentially the most important and valuable gaming operation in Malta. National Lottery plc will be taking over the operations of the national lottery from Maltco Lotteries who have been at the helm of the lottery since 2004.
What can you tell us about the project of the National Lottery and how did the company prepare itself for such a defining project?
National Lottery plc is a subsidiary of the largest land-based gaming operator in Malta, the IZI Group. The idea to venture into the operations of the national lottery started more than 10 years ago when the Group had joined forces with International Gaming Technology (IGT) to bid for the concession of the national lottery in 2012. At that time, we just missed out in our bid to operate the national lottery. However, that did not deter us from once again bidding for the concession to operate the national lottery. We continued to focus on the project and 10 years later we successfully earned the right to operate the national lottery after the successful conclusion of the Request for Proposals (RFP) process that was undertaken by the Privatisation Unit (PU) on behalf of the Government of Malta.
The operation of the national lottery was the only missing business vertical for the Group. Adding the national lottery to the established operations that the Group has nurtured over the years, namely the Dragonara Casino and the IZIBET retail network, gives us a great sense of pride in being able to provide the market with a holistic service across the gaming spectrum.
Preparation for the project started over 2 years ago and was crystallised in November 2021 when National Lottery plc was declared as the Preferred Bidder to take over the national lottery by the Privatisation Unit. Our commitment to the project was clear and unequivocal and is the largest investment undertaken in the gaming industry in Malta, and one of the largest concession fees paid for a public concession, a total of €125M over the next 10 years.
You recently unveiled the National Lottery brand in a symbolic event in Mdina, capturing the true essence of your project, a national lottery service that is truly Maltese?
The lottery market in Malta has a deep-rooted tradition in the Maltese grass roots. The first Lotto draw was undertaken in 1923, nearly a hundred years ago and before that the Maltese participated in the German and Sicilian lotto. Ever since we commenced our preparations for this project, we were driven by the notion to give back to the Maltese a national lottery that belongs to them and to their heritage. For the last 18 years the lottery has been run by a subsidiary of the Greek group Intralot who decided to do away with the term National Lottery. Our first decision was to bring back the National Lottery as the brand under which all other product brands will co-exist under one ecosystem.
The choice of name was not coincidental. We undertook thorough market research to determine what the market truly wants, and this marketing effort has enabled us to come up with the core requisites which we believe will make this project successful. The first step was to listen to the market and to build a portfolio of products that the local market can truly build a strong affinity to.
Are we to expect major changes to the product portfolio of the National Lottery?
I wouldn’t categorise the changes to be undertaken as revolutionary in nature, but yes, we will undertake changes that we feel will continue to grow the inherent demand for draw-based games such as Lotto and Super 5. Our main philosophy is to make the games more engaging, to make the games easier to access and to ensure that all the products are delivered in a safe and responsible manner. Amongst the most important drivers to the existing games, I would include a second draw for Lotto which for 100 years was always drawn on Saturday. Now from July 9th onwards a second draw will be organised every Tuesday evening. We are also eliminating all capping on wins such that players take home the full amount that is owed to them. Moreover, to make the games more engaging we have decided to improve the pay-outs. The envisaged changes will improve the popularity of the games that already enjoy a strong inherent demand locally.
We will also be introducing a number of new games, that have performed very well in similar markets to Malta. We are excited to see how these new games, such as the PICK 3 will perform.
What do you consider to be the most important factors that will drive the business of the national lottery?
From day one we knew that to deliver a strong business proposition in this sector we needed 4 very important factors.
First, a strong product portfolio that the market can relate to. As explained earlier, the changes to the existing products brought about after considerable research with all market stakeholders, enables us to be very optimistic that we are providing a portfolio of products of the highest quality. The new products are also designed to engage the market especially those market niches that for years have felt disenchanted by the product offering.
Second, but equally important is the distribution and accessibility of the product. We are pleased that after months of discussions with the representatives of the national lottery agents we have concluded an agency agreement that is forward looking and that fulfils the requirements of all stakeholders over time. Product accessibility, work practices and service levels are essential elements of our offering.
Third, is the trust factor. This can only be attained if the market truly believes in our service offering and, in the manner, we are delivering it. We have ensured in all our work practices that the service is offered in a safe and responsible manner in full compliance with the regulations governing this sector. We have ample experience in this area having delivered a vast array of other gaming products in the market for over 20 years.
Finally, we made sure that the innovative aspects of the business are well taken care of, by teaming up with the largest lottery technology provider in the world, namely International Gaming Technology (IGT). IGT provide us with the right infrastructure to deliver a world class lottery product throughout the term of the concession.
Finally, what do you consider to be the opportunities and challenges that lie ahead in this venture?
The most essential element in any business is to build a work culture that is based on core fundamentals. The people across the Group need to be like-minded and have the passion to succeed. Over the years, we have managed to find the right people to form part of what I consider to be a formidable team. Most of the senior executives have been with the Group for nearly ten years, a sign of continuity, longevity and belonging. At the same time, we are always on the lookout for the right talent to fulfil the roles that continue to assist our growth. The overall objective is to improve the collective learning process of the Group, and to build knowledge across all the facets of the business. The opportunities that lie ahead are all a function of our ability to understand the market and deliver the experiences that the market is looking for.
In terms of challenges, the gaming industry has evolved over time and through this evolution, new challenges emerge. The single most important challenge that we face is that of meeting customer expectations in such a dynamic and evolving market. Our philosophy has always been built on the premise of offering gaming experiences in a responsible, fair, and transparent manner. This dictates a zero- tolerance policy to financial crime and a compliance culture that is ingrained in our operation. In many ways we consider ourselves a role model operator and are proud of our unblemished track record in terms of compliance. This drive towards transparency and fairness is highly appreciated by our customers and is the main reason why we continue to be a trusted operator by thousands of customers who regularly visit our establishments.