Strategic Direction for Online Games
Vedlegg 3 - Strategiunderlag
Reference: INTER-070-13
Background and strategic direction: INTER-070-13
Table of contents
1
AMBITION AND STRATEGY FOR INTERACTIVE ONLINE GAMES ............................................................................ 3
2
PRODUCT PORTFOLIO AND TARGET GROUPS ...................................................................................................... 3
2.1
2.2
2.3
2.4
3
TARGET GROUP 1: 18-30 / SCRATCH TICKETS ................................................................................................................. 4
TARGET GROUP 2: FEMALE 25-40 / BINGO .................................................................................................................... 4
TARGET GROUP 3: 18-35 / “GAMES”............................................................................................................................ 5
TARGET GROUP 4: MALE 18-30 / CASINO ...................................................................................................................... 5
A DIFFERENTIATION STRATEGY ........................................................................................................................... 5
3.1
3.2
3.3
3.4
SCRATCH TICKETS ................................................................................................................................................... 6
BINGO .................................................................................................................................................................... 7
CASINO ................................................................................................................................................................... 7
“GAMES” ................................................................................................................................................................ 7
4
NORSK TIPPING’S STRATEGY FOR INTERACTIVE ONLINE GAMES – AN OUTLINE .................................................. 8
5
NORWAY & NORSK TIPPING - NORSK TIPPINGS STRATEGIC CORPORATE ASSETS ............................................... 8
5.1
5.2
6
“A SENSE OF HOME” .................................................................................................................................................. 8
STRATEGIC CORPORATE ASSETS ..................................................................................................................................... 9
PRODUCTS AND SERVICES ................................................................................................................................... 9
6.1
6.2
6.3
6.4
6.5
SCRATCH GAMES.................................................................................................................................................... 9
BINGO .................................................................................................................................................................. 10
“GAMES” (CASUAL, SOCIAL, ENTERTAINMENT GAMES) ................................................................................................. 10
CASINO ................................................................................................................................................................. 12
“PRIVATE LANE” - NORSK TIPPING UNIQUE PRODUCTS ....................................................................................... 12
7
PLAYER EXPERIENCE .......................................................................................................................................... 13
8
MARKETING & CRM .......................................................................................................................................... 13
9
CHANNELS & DISTRIBUTION.............................................................................................................................. 13
10
SUMMARY ........................................................................................................................................................ 15
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Background and strategic direction: INTER-070-13
1
Ambition and Strategy for Interactive Online Games
Norsk Tipping’s ambition within interactive online games is to establish itself as the dominating operator
with a market share of minimum 70 % in this part of the Norwegian money gaming market within two years
from launch (measured in active customers, defined as having placed a bet within the last 13 weeks)
Secondary goals:
 Achieve a significant increase in Norsk Tipping’s customer base in the age segment 18 to 40 years
 Achieve a significant increase in Norsk Tipping’s customer base in the female segments
 Achieve a significant channeling effect from international gaming companies actively operating in
Norway.
 Achieve a significant transfer of gaming activity from existing online and offline customers, also
resulting in a greater spread of stakes across Norsk Tipping’s total product portfolio.
 Reach a yearly Gross Gaming Revenues (GGR) of minimum NOK 250 million.
These ambitions are an important part of Norsk Tipping’s overall long-term business strategy focusing on
modernization and improved customer orientation.
2
Product portfolio and Target Groups
In order to reach this ambition, Norsk Tipping has identified four product categories as core elements of the
company’s online interactive strategy:
1.
2.
3.
4.
Scratch games
Bingo
“Games” (Casual, Social, Entertainment Games)
Casino
In addition, we also want to highlight the need that key products within any of the product
categories above also are available in the form of compelling mini and/or side games.
Each product category has been assigned to act as the core product offering for a defined target group, not
meaning that target group will not play on the other categories. The four core target groups identified by
Norsk Tipping are:
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Target Group 1:
Target Group 2:
Target Group 3:
Target Group 4:
18-30yrs / Scratch Tickets
Female 25-40yrs / Bingo (medium to large involvement)
18-35yrs / «Games»
Male 18-30yrs / Casino (large to heavy involvement)
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Background and strategic direction: INTER-070-13
In the model below the combinations of target groups and product categories are presented in Norsk
Tipping’s Customer Segment Model. In short, this model is defined as a combination of four different age
segments and five levels of involvement (defined by actual playing behavior):
As illustrated, the ambition with this portfolio is a very clear focus on reaching market segment between 18-40 years
and attracting new customers.
2.1
Target Group 1: 18-30 / Scratch Tickets
Today, FLAX™ and ODDSEN™ are Norsk Tipping’s products with the youngest concentration of players. The
main target audience for the games in the scratch category will be in the age segments 18-30, covering a
range from heavy to light players. It will also be a natural ambition to target new players who aren’t
attracted to Norsk Tipping’s traditional lottery products.
Player Characteristics
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2.2
Main motivations are excitement, simple entertainment, a pastime activity
Popular among younger adults
Attracts both women and men
Target Group 2: Female 25-40 / Bingo
The most important target audience is women, even though a large group of players are men.
Player Characteristics
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Main motivations are excitement, entertainment and social elements
(Chat and Facebook are important)
Loyal customers who play to be social
Play more frequently than other categories
Jackpot is an important driver
Especially popular among women around 40 yrs
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2.3
Target Group 3: 18-35 / “Games”
The main target group for the “Games” category is considered to be in the age segment 18-35, with the
highest concentration to be found among customer segments who currently don’t find Norsk Tipping’s
existing games to be attractive.
Player Characteristics
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2.4
Main motivations are excitement, simple entertainment, pastime activity, social elements (social
status) and friendly competition.
Popular among young adults, including segments that currently aren’t attracted to Norsk Tipping’s
product offering.
Attracts both women and men
Target Group 4: Male 18-30 / Casino
Casino players are characterized by being a highly involved customer segment with a distinct materialistic
orientation. The target audience for eCasino will be largely represented by males aged 18-30 and the high
involvement segments in all ages for both genders.
Player Characteristics
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3
Highly involved and risk willing players
Materialitic values
Popular among young men, mainly aged 18-30
Play to win (money is the key driver)
A Differentiation Strategy
Differentiation is a pivotal part of Norsk Tipping`s strategy for interactive games. Norsk Tipping use
NeedScope™ as a tool for brand strategy and product positioning. Two axes form the framework of the
NeedScope™ archetypal model:
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Background and strategic direction: INTER-070-13
The left side of the primary horizontal axis is about the need for affiliation and receptivity – a fundamental
sense of belonging. The opposite side is the drive for individualism and assertion. This is the drive to stand
out from others rather than be part of the group.
The second dimension runs vertically and divides the model into extroverted and introverted poles.
While there are clearly polar opposites on the Needscope model, there is no positive-negative axis –every
position on the model can be positive for a brand.
The model consists of six core archetypes, here presented in brief:
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3.1
RED - being on the right hand side of the model, has a strong sense of individuality while its position
at the top gives this archetype an outward focus – extroverted and high energy. In personality
terms it`s characterized by a strong independence that is dynamic and dares to be different. The
feeling here is very physical, highly charged and fearless.
PURPLE - sits on the far right of the model, so is defined largely by the need to assert individualism.
With it comes a personality that is forthright and assertive, an overt sense of social power and a
feeling that exudes confidence and dominance.
BLUE - is towards the bottom of the NeedScope™ model so has a more inward energy in terms of
both personality and feeling. But being on the right of the model, there is also an element of
individualism and assertion. So the feeling here is one of composure, efficiency and order. The
personality can be described as discerning, refined and intelligent.
BROWN - on the left of the model means there is an inherent affiliative nature paired with an
introverted perspective. Hence it is characterized by a caring, gentle nature combined with a
thoughtful and considerate outlook. This generates a contented, peaceful feeling which is soft and
reassuring.
ORANGE - positioned on the far left of the model, sits in the heartland of affiliation. The personality
therefore has real warmth to it, accompanied by an easy-going, genuine nature that wants to
belong. As such, the feelings here are those of harmony and belonging.
YELLOW - is extroverted and sociable, reflecting its position at the top of the model on the left hand
side. The feeling here is of fun, feeling spontaneously, happy and joyful. A lively personality
epitomizes this archetype.
SCRATCH TICKETS
Given the strong brand presence and market position of the FLAX™ portfolio in Norway, Norsk Tipping
wants to build on the strength of this brand. This will help create legitimacy and trust among players,
particularly players who are new to online gaming. The scratch category will have two different ‘subcategories’ – both traditional scratch tickets, and also new, more ‘interactive' scratch games. Norsk Tipping
will at a later stage in the market development process decide how to leverage the established and valuable
FLAX™ brand for this new online scratch games portfolio.
Norsk Tipping wants to give FLAX™ a position based in the yellow segment, following the characteristics
described in the previous section. In addition, the established brand platform for FLAX™ states that all
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Background and strategic direction: INTER-070-13
products should be developed as ‘Uncomplicated, Playful and Energetic’.
3.2
BINGO
Since Bingo appeals to both genders, albeit disproportionately many women, and where social features are
central drivers, a «soft» visual profile is recommended, slightly reflecting feminine values. It is also in Norsk
Tipping’s strategic interest to adapt a gaming offer specifically for women, given the historic difficulties in
reaching this audience, and particularly for electronic channels.
As for FLAX™, Norsk Tipping wants to give Bingo a position based in the yellow segment, following the
characteristics described in the previous section.
3.3
CASINO
Electronic casino games, and in particular video slots, is the game category most often associated with
problem gaming. These are also games with high appeal amongst high involvement player segments. Given
the differentiation strategy, Norsk Tipping will handle the market communication related to these games
with particular caution.
Norsk Tipping wants to establish Casino games in the red segment, following the characteristics described in
the previous section.
3.4
“GAMES”
An important role of the “Games” category as part of the new online games business area is to support
Norsk Tipping’s desired market position by establishing a distinct market profile. The “Games” category will
also be given a ‘profiling role’ not only on behalf of this particular business area, but also as a general ‘sign
of renewal’ for Norsk Tipping. These games will be therefore be given a prominent role in future market
communication of the new online portfolio.
Even though the product range within this area will be wide, it’s important that the portfolio have some
consistency in the branding. As for FLAX™ and Bingo, Norsk Tipping wants to give the “Games” portfolio a
position based in the yellow segment, following the characteristics described in the previous section.
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4
Norsk Tipping’s Strategy for Interactive Online Games – an outline
Norsk Tipping’s Interactive Online Strategy is based on the following cornerstones:
1.
2.
3.
4.
5.
Norway & Norsk Tipping
Product and Services
Player Experience
Marketing & CRM
Channel & Distribution
Norsk Tipping is convinced that a
successful Interactive Online Strategy
will rely on all of the above
cornerstones.
The challenge lies in finding the
optimal commercial mix of these
cornerstones in order to create a truly
competitive and differentiated
customer experience for each target group, a combined mix that will meet the overall business ambition.
In the following, you will find a brief description of Norsk Tipping’s perspective on these five cornerstones.
5
5.1
Norway & Norsk Tipping - Norsk Tippings Strategic Corporate Assets
“A Sense of Home”
Norsk Tipping with its history and tradition is uniquely positioned to establish a market position, hereafter
referred to as “a Sense of Home”. No operator is better equipped to offer truly Norwegian gaming
experiences; offering classic Norwegian retro games as well as modern, interactive games and services in
Norwegian, incorporating Norwegian cultural references and/or licensed TV concepts in our games, using
Norwegian celebrities to endorse games, participate in tournaments or work as temporary Bingo chat hosts.
Norsk Tipping’s strategy is to offer the customers more than the typical, more or less standardized online
game package.
“A Sense of Home” also means localized games and services, meaning local or regional tournaments as well
as national tournaments. No other operator can rightfully claim or justify calling someone “Norgesmester”
(official Norwegian Champion). Our strategy is to aggressively seize this position being the only licensed
operator.
“A Sense of Home” also implies playing with your closest friends and family by utilizing Norsk Tipping’s
massive registered player base of 2 million players (more than half the adult population), and/or by
integrating our products and services with the dominating social media companies (Facebook, Twitter,
YouTube).
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This strategic differentiated approach requires not only extensive customization of products and services –
the desired position and reputation as the national operator rests upon the fact that Norsk Tipping simply
cannot offer the exact same game package to be found at competing online gaming operators.
5.2
Strategic Corporate Assets
An instrumental part of ensuring a competitive and differentiated customer experience is to fully take
advantage of Norsk Tipping’s corporate assets and unique selling propositions, such as:
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A very strong brand and market position
A customer base of approx. 2 million
A highly reputable and trusted company
World class Responsible Gaming features and credibility
Very successful and internationally recognized gaming services on internet and mobile platforms.
Non-profit organization – all profits benefit sports and voluntary organizations.
The Grass Roots Share – allowing players to donate directly to their local team or favorite charity.
Strong and long-lasting relations with the Norwegian sports movement and voluntary organizations.
Strong, strategic relations with dominating media companies (NRK, TV2, VG, Dagbladet, Nettavisen)
Unique ID solution (Player Card) across all platforms and products, ensuring secure, fast and charge-free
transactions.
Wins from Norsk Tipping are tax free
No customer fees on deposits and withdrawals
The Player Card is also the core of Norsk Tipping’s RG platform, ensuring efficient age verification,
prevents multiple accounts, and enables world-class RG tools based on advanced behavioral analysis.
Repeatedly voted Norway’s best Customer Service.
Extensive presence and exposure on the biggest TV Networks, Radio Stations and Media houses –
through TV drawings, strategic partnership agreements and traditional ad spending.
Approx. 4.000 offline retailers (convenience stores, kiosks, gas stations, pubs, bingo halls)
The strategy in short is to develop the “A Sense of Home” position by leveraging these Strategic corporate
assets.
6
PRODUCTS AND SERVICES
As mentioned in the introduction to this outline of Norsk Tippings strategy for interactive online games,
Norsk Tipping will offer products within four categories as as a part of their overall Interactive Online Game
Strategy.
6.1
SCRATCH GAMES
As mentioned; Norsk Tipping currently has a strong and established physical scratch ticket offering with its
FLAX portfolio. This product category is attractive to players who want simple and quick entertainment and
excitement. Norsk Tipping wants to offer two main types of electronic scratch games as part of the
company’s interactive online games strategy:
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

6.2
Traditional scratch tickets
Electronic ‘versions’ of Norsk Tipping’s existing FLAX™ portfolio, meaning games that look like the
physical scratch tickets with a corresponding player experience.. However, the strategy is also to offer
channel specific scratch tickets with customized themes and a different prize structure, provided that
they are presented as “traditional scratch tickets”. The prize structure and mathematical model shall be
equal to the physical versions.
Interactive scratch games
Along with the traditional scratch tickets the strategy is also to launch new scratch games using channel
specific technical features (e.g. interactivity, navigation, geo-location, built-in gyro, touch features,
microphone capabilities, augmented reality), with increased interactivity and a richer visual
presentation, yet based on the same business rules as traditional scratch tickets.
BINGO
Norsk Tipping wants to offer two forms of Bingo games:
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
Single Games - where players play against Norsk Tipping’s systems in an individual draw
Multi Games - where multiple players participate in the same draw according to a defined schedule
Its social dimension and a high degree of loyalty and sense of belonging largely recognize online Bingo,
which impact the product and service strategy. The strategy is to provide a comprehensive, modern and
social bingo offering, where value added services and features must be added in order to have a fulfilling
player experience, including the use of complementary merchandise prizes (consumer products, travels,
concert tickets, etc.). To create and leverage on the social dimensions the strategy states that it is of great
importance that the services should include live chat with dedicated and attentive hosts, competitions, trial
play and integrated social features.
Jackpots are another key driver in Bingo and the strategy is to make jackpots prominent and integral to the
player experience.
Offering Side games / mini games is a part of the strategy. It is particularly important for Multi Games, as
players will experience waiting periods in-between Bingo draws.
6.3
“GAMES” (Casual, Social, Entertainment Games)
Parallel to the growth of online money games over the last decade, there has been considerable
development within games and game formats, which currently aren’t associated with traditional money
games. Such games are better described as «Online Entertainment Games» (Angry Birds, Bejeweled, etc.).
The explosive growth over the last couple of years, which is likely to continue, is mainly the result of new
mobile platforms, social media, consumer friendly business models, simple yet advanced game
development tools, in addition to increased availability of simple engaging games on «traditional» web sites
(mainstream media).
Several market research reports indicate that such games will grow as money games in the coming years.
The following statement illustrates this potential:
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Essentially, the online skill gaming industry is immature compared with its poker and casino games
peers, despite online skill games having been around for over a decade. (…)However, the increasing
popularity in mass-player gaming means that the potential numbers are out there for skill games
operators to achieve growth. And as skill games are complementary to other types of online games
(and indeed often referred to as a ‘gateway’ product), and they are based on games that often have
immense popularity in their online forms, skill gaming operators may have every reason to be
optimistic about their genre’s future. Skill games …have the potential to attract a wider audience.
Source: The Global Business of Skill Gaming (iGamingBusiness)
Market research (Norsk Monitor) indicates that approx. 900.000 adult Norwegians play these types of
games on a regular basis from free web based game sites. Approx. 500.000 of these players have a positive
attitude towards money games. Based on these insights, Norsk Tipping considers these games to be longterm and strategically important in order to modernize Norsk Tipping’s profile, position and attractiveness
towards a larger Norwegian audience
Norsk Tipping’s strategy is therefore to offer money games where entertainment, individual skills and social
dimensions are the key drivers for the player experience. The strategy focus on three different game
formats:

Single Player Skill Games
Games with a combination of chance and skill elements where the player plays individually. The strategy
is to combine chance and skill elements in order to optimize revenues and stimulate player
recruitment/retention, and also adding features that are necessary to keep players engaged. Examples
of possible Games products are Quiz games, Word games, Dexterity games, Puzzles, Card games,
Strategy games, Action games, etc.

Multi-Player Games
Games with a higher degree of skill elements and entertainment value where the player experience
itself is a stronger driver than winning money. The player plays individually (single game) or versus other
players (multi game/p2p), either synchronous or asynchronous.
In order to be successful with social games the strategy is to:
1. Secure that the games are fun and engaging to multiple player segments
2. Create a sustainable business model
3. Utilizing people’s personal networks and innovative social features such as high score lists,
gamification features, integration with social media integration and Norsk Tipping’s existing
player base.

Random Based Instant Games
The strategy is also to offer a “soft gaming suite” consisting of various random based instant games.
Examples are different Fixed Odds games, Hi-Lo games, Virtual Racing games, Dice games, Arcade
games, etc.
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6.4
CASINO
Norsk Tipping’s strategy is to offer a wide selection of electronic casino games. The product category is
recognized by the games’ relative quick draw frequency and large selection of game variants. Win structure
will vary from game to game, with jackpot as an added feature (game triggered as well as global mystery
jackpots).
The strategy focuses on the following sub categories:

Slots Games
The strategy is to differentiate the slots portfolio by focusing on entertainment driven games with a
clear storyline (theme) and preferably story driven bonus features with engaging and interactive
features to accentuate the player experience.
A part of that strategy is to offer video slots instead of classic slots emulating mechanical slots with
references to traditional gambling symbols. That means aligning the games with a Norsk Tipping profile,
customization some games with new game titles, reel symbols and perhaps even new licensed theme
(based on Norwegian cultural references)

Table Games
The strategy is to offer a wide range of table games, starting with the most known games such as
Roulette, Black Jack, Caribbean Stud Poker and Baccarat. To secure differentiation of the table games
portfolio, the strategy is to use customized, Norsk Tipping branded table cloths, chips, cards, croupier
uniforms etc. The strategy is to create a unique Norsk Tipping style and look-and-feel of the player
experience, appealing to the general Norwegian public more so than the hardcore gamblers.

Video Poker Games
The strategy is to offer a selection of video poker games, again with customized Norsk Tipping branded
cards and chips.
6.5
“PRIVATE LANE” - NORSK TIPPING UNIQUE PRODUCTS
As part of the overall differentiation strategy, Norsk Tipping has defined the need to establish a so-called
‘private lane’ for the development of certain products and services especially for the Norwegian market.
Through a ‘private lane’ Norsk Tipping will be able to customize the portfolios to meet unique Norsk
Tipping’s requirements and desired profile, for example:

Development of Norsk Tipping’s scratch ticket portfolio of FLAX™, including new, channel specific
tickets (e.g. Augmented Reality FLAX™)

Development of some defined games (instant, casual, social, entertainment etc.) specifically and
exclusively for Norsk Tipping, based on ideas brought forth by Norsk Tipping or creative partners.
Immaterial rights related to games and game related services developed under the ‘Private Lane’
development contract, will be the property of Norsk Tipping.
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7
PLAYER EXPERIENCE
To deliver truly great gaming experiences takes more than a wide and innovative game/services portfolio,
entertainment and social features. It is essential that the product and service offering is designed in a way
that is perceived by the target groups as intuitive, fast and accessible. This is of special importance since the
ambition to recruit new and younger player groups requires dedicated focus on the player experience.
The strategy is therefore to make sure that the following dimensions are addressed and taken into great
consideration in the process of designing and packaging the game and service offering:
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8
Seamlessness – Creating an intuitive gaming flow between products and devices
UI – A user-friendly interface
Speed – A gaming service that is perceived as fast and quick
Availability – A gaming service that is perceived as available and stabile
Safe & Secure – Responsible Gaming has to be an integrated part of the gaming experience
MARKETING & CRM
Once recruited it is important to secure the loyalty and frequency of the player base.
Norsk Tipping’s strategy is to:
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Use new and innovative solutions to create high presence at digital market places used by the defined
target groups, like social media, The Grass Root Share and the existing internet affiliate network.
Improve CRM to achieve repeat visits, extended player session and create loyalty
All these efforts will be aligned with Norsk Tipping’s responsible gaming policies, market restrictions and
political mandate.
9
CHANNELS & DISTRIBUTION
As presented in the previous chapter Norsk Tipping has a well-established and successful online presence.
The offering through mobile devices is world-leading and highly appreciated especially by younger customer
segments.
The strategy is to make the new Interactive Online offering available through multiple interfaces like web
PC/Mac, smart phones and tablets. The growth of new TV-platforms means that this also might become an
attractive platform for offering such games in the foreseeable future.
The mobile channel, using devices such as smart phones and tablets, is of great importance reaching the
ambitions of recruiting new and younger players and strengthening Norsk Tipping’s leading mobile position.
The strategy is therefore to offer a broad and competitive mobile Interactive Online Gaming portfolio based
on the specific conditions for each device.
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A broad and flexible distribution is essential for the realization of the overall business ambitions. It is of
special importance in the ambitions of recruiting new and younger customers.
The strategy is to distribute though the following digital marketplaces:
1. Digital marketplaces owned by Norsk Tipping
 norsk-tipping.no
 Existing and new smartphone apps and solutions
2. External digital marketplaces used by the defined target groups
 Social networks, especially given the possibility that these redefine their current commercial and
money gaming policies
 Media websites (through existing and/or new affiliate programs)
Cross selling is another important part of the distribution strategy. Exposure of the new game and service
offering next to existing games, where applicable, is essential to get new and existing customers to play and
to increase net spending per customer, for example:
 Exposure of Casino Games to Sports Games customers
 Exposure of Scratch Games to Lottery customers
 Exposure of various Mini Games / Side Games in different contexts (e.g. Bingo)
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10 SUMMARY
Norsk Tipping is convinced that a successful Interactive Online Business Strategy relies on all of the above
cornerstones. The challenge lies in finding the optimal commercial (and strategic) mix of these dimensions
in order to create a truly competitive and differentiated customer experience for each target group.
Dimensions that are of special importance are:
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Develop a unique combination of “A Sense of Home” and unique selling points in order to differentiate
and make it hard to copy by the competitors.
Adding entertainment and social feature into the gaming and service portfolio
Securing an attractive and competitive offering for the new ‘Games’ product category
Securing a great gaming flow
Cost efficient customer acquisition and CRM
Mobile presence
Broad and flexible sales distribution and cross selling
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