Lotto operator hopes to hit jackpot with higher prices and bigger prizes

By tweaking the 45-number format and raising minimum ticket prices by €1, the lotto's new operator Premier Lotteries Ireland (PLI) believes it has hit upon the optimal formula to grow the business without alienating punters.

The changes would probably have been introduced sooner but for a series of technical blunders which ended the company’s honeymoon in charge practically before it had begun.

The template is simple: by upping the spend on tickets and lengthening the odds of winning outright, PLI hopes to generate bigger rollover jackpots.

Jackpots of €10 million plus, which currently occur about twice a year, trigger buying frenzies, which draw in more players. It’s what the industry likes to describe as a virtuous circle.

Under the new format, PLI expects the number of €10 million-plus jackpots to double. It also expects the average jackpot payout to rise by 43 per cent from €4.5 million to €6.3 million under the new structure.

Of course, for all of this to work, the operator needs to keep punters on side.

There are two ways of looking at the new pricing structure. On the one hand, €2 a line is not exorbitant in the context of other European lottos, where prices typically vary from €1 to €3.

However, a minimum ticket price of €4, albeit for a two-line play, marks out the Irish franchise as expensive.

Some will undoubtedly link the price rise to the Government’s decision to bring in a private operator, but after nine years of a price freeze, the hike was probably inevitable.

Perhaps more worrying for the operator is the ongoing contraction in sales, a trend which appears to have continued into last year despite Ireland’s much-touted recovery narrative and the high-profile launch of a new online platform.

PLI will have to halt this spiral if it is to justify the €405 million shelled out for the licence by its Canadian paymasters, Ontario Teachers' Pension Plan. The latter is desperate to notch up a success in Ireland before going after bigger privatisation contracts in Europe and the US.

The addition of two new numbers, which puts the odds of scooping the jackpot here at 10.7 million to one, will anger punters, already used to averting their eyes from what many see as the ridiculously long odds .

Roundly criticised

PLI’s sister group,

Camelot

, was roundly criticised in the UK recently for adding 10 new numbers to its format, pushing the odds of winning out from one in 14 million to a whopping one in 45 million.

The change here is not of that magnitude but cutting the chances of winning jackpots queers the pitch somewhat and perception counts a lot in this game. The softener is that smaller wins will be deliver bigger payouts.

Matching five numbers plus the bonus ball will now pay €100,000 instead of €25,000. There’s also a prize for matching two numbers plus the bonus ball for the first time, and a new Lotto Plus raffle game.

PLI insists the new format will continue to offer a minimum €2 million jackpot and will have an average expected prize payout of 52 per cent of sales for its main lotto game.

The last time the franchise introduced changes to its basic pricing structure and playing format was in 2006 when it upped the price per line from €1 to €1.50 and added three extra numbers.

Back then, however, the Irish consumer was flush with cash and the changes proved a boon for sales. Now lotto bosses face a more cautious animal, tempered by six years of recession – perhaps more in tune with Berlin frugality than Boston largesse.

That said, the operator was beholden to inject some vitality into an ageing formula and bigger jackpots are undoubtedly a way of courting more players.