Gaming & Lotteries business area

The Gaming & Lotteries business area accounts for a substantial share of Svenska Spel’s net gaming revenue. In 2011, this amounted to SEK 6,401 million (6,395), representing some 66% (67) of Svenska Spel’s total net gaming revenue. Net sales from gaming operations, etc. accounted for SEK 5,399 million (5,400). Operating profit in 2011 was SEK 3,607 million (3,547).

The business area is responsible for the sales, marketing and development of all gaming and lotteries at retailers, arenas, on svenskaspel.se, via mobile telephone, corporate customers and subscriptions. The Spelkortet customer loyalty card is also part of this business area.

Gaming & Lotteries is subject to stiff competition in a market in which the player base is shrinking, customers are aging and game evolution is moving faster. The business area focuses on strengthening its relationship with existing customers and channelling potential customers to Svenska Spel through attractive games, high accessibility, advanced responsible gaming programmes, and service.

Gaming via stores

As of 31 December 2011, Svenska Spel had 6,209 (6,604) retailers: retail stores, food stores, department stores, betting stores, tobacco shops and petrol stations. They accounted for SEK 5,055 million (5,143) in net gaming revenue, a decline of 2.3%. The Company’s nationwide distribution network remains unique despite the emergence of new and more modern distribution channels, and represents the Company’s key success factor in addition to its strong brands.

2,580 retailers (2,674) carry the full range of Svenska Spel’s sports betting, number games and lotteries. 3,540 (3,834) lottery retailers sell only lottery tickets.

In addition, Svenska Spel has 89 (96) "checkout" retailers at the ICA chain and Reitan (Pressbyrån and 7-Eleven), where lotteries, Lotto and Joker are sold at the checkout.

Responsible gaming at retailers

The retailers have an age limit of 18 for the purchase of lottery tickets and payment of winnings for all Svenska Spel’s games.

During 2011, customer security was improved with the introduction of identity requirement for the payout of winnings exceeding SEK 1,000. Also, the blocking of retail terminals was introduced for the payment of winnings of SEK 20,000 and more. Information on winnings shown on the customer display was made clearer, and tickets submitted after using the Spelkortet customer card now carry the customer’s name printed on them. These measures ensure that customers are made aware about their winnings and that prize money fall into the right hands.

Svenska Spel regularly makes test purchases in order to control how the retailers handle the age limits. The results have steadily improved and the handling of identity requirements among gaming retailers is now very good in general. ID control is a new routine for lottery retailers and therefore their results have not yet reached the same levels.

A test purchase means that a young person 18–19 years of age – who looks younger, and whose identification the retailer should check according to the rules – visits the retailer, buys a ticket and notes whether the retailer asks for identification. The rule is that retailers must check the identity of people under the age of 25. The proportion of approved test purchases is now 84% (86), which clearly shows that retailers are satisfactorily managing their age limit controls. Among lottery retailers, where ID checks have been routine for more than a year, 59% of the tests were approved. A two-week ban is imposed on retailers who fail two consecutive tests, which affected 97 lottery retailers and 14 (10) gaming agents. Two lottery retailers lost their sales permit after having failed four consecutive tests. An additional 18 retailers (12) lost their contract with Svenska Spel due to serious breaches of contracts. 8 (9) of them had illegal gaming machines in their stores.

Spelkortet – a component in responsible gaming

Following its decade-long use, the Spelkortet customer card programme has now been developed to form a key feature of Svenska Spel’s brand and responsible gaming. The card is personal and free of cost, and application can be made at retailers or on svenskaspel.se by customers who have turned 18 and are registered residents in Sweden. The Spelkortet card is obligatory for gaming on svenskaspel.se. Some 1.2 million customers have acquired the card. Spelkortet provides automatic monitoring of winnings, permits gaming on svenskaspel.se, where players can also control their gaming behaviour via the PlayscanTM tool and receive offers of discounts and competitions, etc.

Svenska Spel continues to develop the Spelkortet customer card as part of efforts to create added value for customers. Currently, the card cannot be used for buying lottery tickets at retailers, neither on Vegas or in the casinos.

Dialogue with retailers

Svenska Spel cooperates with retailers in order to optimise the in-store customer service.

The business area has a special section for training retailers. The Retailer School has its training premises at Svenska Spel’s Sundbyberg office, where retailers – especially recently established ones – receive training in responsible gaming, games, retailer terminal know-how, customer service, and so forth. The school also offers open courses in various subjects nationwide. In 2011, 359 people (387) attended the Retailer School and 2,079 (1,872) participated in training courses.

Retailers also have their own Svenska Spel website at their disposal, with access to training, information, campaign news, and so forth. In addition, a weekly newsletter, "Spelveckan", is sent to gaming agents, while the monthly "Spelnytt" magazine is mailed to all retailers.

Svenska Spel has its own betting store – known as "The Lab" – in its offices in Sundbyberg. It also serves as a café and a test environment where Svenska Spel can test new games and concepts and pursue direct dialogue with customers and retailers.

Once annually, Svenska Spel arranges the much-appreciated "Ombudsgalan" (Retailers’ Gala). Selected retailers are acclaimed for their exceptional input in a number of categories such as "Retailer of the Year", "Climber of the Year" and so forth. The retailers’ gala event in 2011 was held at the Ericsson Globe Arena in Stockholm, to which a few hundred retailers were invited to attend exhibitions, information, have dinner and enjoy the entertainment.

Internet gaming

Svenska Spel estimates that in 2011 the net gaming revenue via the Internet from the Swedish market totalled some SEK 4,900 million (about 4,400) up 11% from 2010. On the Internet, Svenska Spel has a market share of approximately 25% (27).

Total net gaming revenue at svenskaspel.se in 2011 increased to SEK 1,188 million (1,152). Sports games, number games and Bingo increased, while poker and lotteries decreased.

The single most popular game on svenskaspel.se is Lotto, followed by poker. Despite its decline, poker reported net gaming revenue (referred to as the rake) of SEK 214 million (231) and raised its market share in 2011. For the fifth consecutive year, a Swedish Poker Championship was arranged online, with a record participation level of some 6,000 players.

Responsible gaming on svenskaspel.se

In contrast to the gaming market as a whole, with less players, the number of players on svenskaspel.se has increased. In brief, more people are playing but their stakes are smaller. This is a positive development as svenskaspel.se is to channel players from foreign gaming sites. Playscan™ and the Spelkortet customer card help players to be aware of their gaming behaviour. An upgraded version of the responsible gaming tool was launched in 2011. Before playing, all players on svenskaspel.se must indicate the size of the stake they wish to play for, and poker players must also indicate how long they intend to play.

Mobile gaming and services

Mobile phones, smartphones and tablet computers are now distribution channels with substantial growth and a high development rate of new services. Svenska Spel Mål och Resultatservice (scores and results service) is an app designed for the iPhone and Android handsets. Customers can monitor particular games played via svenskaspel.se, mobile phone or submitted at a retailer using the Spelkortet customer card. One selects the sport, leagues and matches that are to be monitored and can see on-going and completed matches, get forecasts, view live score checking, and check the timing and channels for live TV broadcasts of selected matches.

During 2011, Svenska Spel also further enhanced the potential to play via smartphones and the mobile offering currently encompasses gaming on Oddset, the football pools and Lotto. The very first "mobile millionaire" won some SEK 1.3 million on Lotto in November 2011.

Those gaming via a mobile phone gain automatic access to the same responsible gaming tools as Internet players.

Arena sales

The opportunity to play on-site in connection with matches is much appreciated, and currently covers 26 football and ice hockey arenas. On-site arena gaming is a result of a cooperation between Svenska Spel, Arenabolaget (the Arena company), local retailers and sports associations.

Subscription sales

Subscription is a rapidly growing venture. Net gaming revenue in 2011 totalled some SEK 101 million, up 94% from the previous year. At present, Svenska Spel has more than 130,000 subscribers (approx. 100,000). It is currently possible to subscribe to Triss and Lotto with Joker.

Corporate Sales

The Corporate Sales unit focuses on companies buying games and lottery tickets as prizes in competitions, or as gifts and so forth. 2011 saw the launch of Triss Gift Code that customers – both private and corporate – can order via an account at svenskaspel.se and then forward to the intended recipient. The recipient presents the gift code at a retailer or on svenskaspel.se and receives the gift of Triss. This innovation instantly had a customer acceptance exceeding all expectations.

Successful ventures

Sports games have a committed and knowledgeable customer base that imposes high demands in terms of the gaming experience and prefers fast games with a high reimbursement. Last year’s increase of the reimbursement of Stryktipset and Europatipset resulted in an almost 20% increase in gross revenue thereby levelling out a declining trend.

In 2011, the business area focused on a broader offering for the Oddset Powerplay, which more than doubled its net gaming revenue.

The business area and the O’Leary’s sports pub chain commenced a cooperative venture, which has made the pubs a venue for all those who love football and the Stryktipset football pools.

In connection with the 25th anniversary of Triss, a major campaign was launched featuring higher winnings. In 2011, a commercial for Lotto was nominated for the Swedish Guldägget (Golden Egg) award, and Triss was awarded two Silver Lions at the advertising film festival in Cannes.