The latest results released by Tabcorp in their Annual Report reveal that the percentage of lotteries revenue from online has increased, but not on the previous trajectory. The year on year comparison shows a jump from 28% in FY2019/20 to 32.8% in FY2020/21 and while that jump is sizeable, it’s the 6 month jump that is lower. Six month earlier they were 32.1%
32.8% of revenue coming from digital (online) must interest lottery retailers, especially since Tabcorp says it would like to see online revenue grow.
Another possible concern for retailers will be Tabcorp’s focus on continued diversification of the retail channel. Plenty of retailers have already complained about new outlets opening nearby and an ineffective and opaque appeals process run by Tabcorp.
You can see from the Annual Report that they are only part way through this engagement with expanding the retail network. Note below: Evolve retailer mix and CX uplift. (cx = customer experience.)
These slides from the Annual Report deck don’t contain detail useful to retailers. But, there is enough there of concern. The company, in its accompanying press release, spoke re retail:
Lotteries digital turnover grew a healthy 27%. Digital accounted for 32.8% of total lotteries turnover in the year. Customers continue to transact predominantly through the retail channel. Investments to uplift lotteries’ presence and role in retail illustrates the value Tabcorp places on it as part of an omni-channel model that supports customers to buy when, where and how they wish.
The bottom line from my perspective is that lottery products, while important to retailers do present challenges in terms of upside along with channelise in terms of increased outlet competition.
My tip if you have lotteries through Tabcorp: do everything to meet your obligations while at the same time working on the business to attract new shoppers for better margin product over which you have more control, as this will be your future.