Consulting firm has ‘ambitious’ plan for lottery
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Consulting firm has ‘ambitious’ plan for lottery
For all of us keeping up with Arkansas Scholarship Lottery (and we don’t mean buying a pocket full of $2 lottery scratch off tickets), the consulting firm lawmakers have agreed to compensate (up to $750,000 a year-plus) has interestingly come up with an “ambitious” vision for the lottery’s future to justify its whopping fees and demands.
Camelot Global Services, which has offices in London and Philadelphia, was hired by lawmakers without seeking bids, envisions ticket sales steadily increasing from $450 million in the current fiscal year to $615 million by fiscal 2021 if its selfdescribed “ambitious” five-year business plan is embraced by the powers-to-be.
Before we get into the details of this plan, let’s go over the details of Camelot’s contact, which is very eye opening to say the least. The consulting firm has already received $55,877.37 for base compensation and expenses and will get up to $750,000 during the duration of the contract, plus be eligible for incentive compensation of at least 12.5 percent of the lottery’s adjusted operating income above $72.28 million in a fiscal year.
Let’s just say lawmakers reject the contract. Well, at that point Camelot won’t receive incentive pay if the business plan is rejected but, the Lottery will be obligated to pay restitution for any services provided by Camelot, with a maximum amount of $200,000.
Oh, but there is more that Camelot will receive in compensation to include it keeping 12.5 percent of that $72.28 million and $80 million and $90 million; and 15 percent of any adjusted operating income above $90 million.
Pretty sweet deal that appears Camelot has isn’t it?
Let’s say these folks have as the old saying goes, “the Jack beating the King” if it is able to pull this deal off.
So then, what is exactly in this “ambitious” plan Camelot is flopping down on the table?
Camelot’s five-year plan would:
• Increase the marketing budget from $5 million to $6 million in fiscal 2017 and track the result from the increased budget with a “target” of $6.5 million by fiscal 2018; $7 million by fiscal 20199 and $7.5 million by fiscal 2020.
• Deploy about an additional 600 lottery terminals.
• Introduce a pre-launch scratch-off game development program and recruit an assistant product manager “to ensure that all games are high quality and deliver the fastest rates of sale.”.”
• Create a key account manager position “to interact with chain stores at a head office level, promoting the value of the lottery.”
• Establish a “consumer insight” position to better understand the players and effectively implement the business plan; a public relations post to implement the brand initiatives in the plan; and commercial finance post to “provide sales analysis, business case support, cost control.
• Start a “a consistent winner awareness program to increase win believe and give less frequent players more reasons to play.”
• Develop a new, larger instate jackpot game.
• Create “a responsible play program” focused “on vulnerable play-underage and excessive player behavior.”
And finally, Camelot wants customers be able to use debit cards as well as placing electronic monitor games in bars and restaurants, both controversial proposals that lawmakers shot down during last year’s regular session. And, we doubt, lawmakers will go for the debit card use or the monitor games unless there is a bunch of arm twisting on the part of Camelot negotiators.
The way we look at this situation, Camelot has a sweet deal going and it will certainly be interesting to see if these guys can pull off this “ambitious” plan.
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