Innovating Play: A Chat with ALC President and CEO Brent Scrimshaw

Brent Scrimshaw first joined the Atlantic Lottery Corporation (ALC) in 2006 as the company’s senior marketer.

With a background in sports marketing, he joined the company after serving as the chief marketing officer of the Canadian Football league. Before that he worked for Molson as vice-president of sports & entertainment and president of its sports and broadcast department.

“As part of [my work at the CFL] I brought an exhibition game out to Atlantic Canada and it was really my first extended visit anywhere here. I spent a good deal of time in Moncton and Halifax as well,” Scrimshaw says. “The experience was so positive that when I got back home I said to my wife if there was ever an opportunity to move to Atlantic Canada, particularly the Maritimes, I’d like to do it.”

About four months later, Scrimshaw spotted an ad in the Globe and Mail for the vice-president of marketing position at ALC. He applied and got the job. Five years later, in 2001, he took on the role as President and CEO.

Though lottery may seem like a big switch from football and beer, Scrimshaw they share one thing common: they are the realm of entertainment people are passionate about.

“They’re all categories under the heading of ‘passion brands.’ They are brands that folks have an emotional connection with and lottery games like 649 and Lottomax fall into that same camp,” he says. “They’re really entertainment-based offerings and I like working in that business with those type of products.”

Atlantic Lotto just came out of what Scrimshaw describes as a “banner year.” He says the company’s consolidated net profit rose from $368 million last year to approximately to $431 million this year. According to its annual report, ALC has experienced sales growth in every province and in all their lines of business. In 2015-2016 retail sales jumped to $732.7 million from $654.2 million in 2014-2015. Destination sales climbed from $402 million to $442.1 million and iLottery grew to to $27.5 million from $21 million.

Though it was a strong year, ALC is facing some pretty huge challenges. One is competing in a global online world of gambling and entertainment games, a world that is often unregulated. Scrimshaw says if ALC is going to compete, they need to have a strong presence in that space.

“There’s no question that our marketplace is becoming more and more tilted towards the digital side of business. We have a fleet of 3000 retailers that will always be the backbone of our business,” he says. “But for us to continue to get the kind of result that we did last year, we have to be in the digital space. That means new types of games, games that involve skill, games that have more entertainment value and games that provide the opportunity for social activity.”

Scrimshaw says ALC was the first lottery in North America to retail products online in 2004. Until now, those products have mostly been lottery games with a few entertainment and sports games. That’s not longer cutting it, but they’re ready to take things to take things a step further.

“We just need to go deeper and broader if we are going to succeed,” he says. “Sometime next spring we will launch a new gaming system for both our ticket lottery business and for our iLottery business. That will allow us to offer a really broad range of games efficiently at the speed of the market.”

But Atlantic Lottery’s biggest challenge is one that’s not unique to them. Lottery companies globally are struggling to get young adults, also known as the “millennials,” to play. Scrimshaw says it comes down to having the right products and the right channels.

“Over the course of the last 10 years we’ve seen our player base for young adults drop by almost half,” he says. “This mission that we have to offer different types of games and different channels is absolutely fundamental for our plan going forward.”

Another part of getting more young adults to use ALC products is driving home the message about the positive spin-offs playing Atlantic Lottery has for the region and the responsible practices it has in place. In case you haven’t heard, millennials care about that kind of stuff.

“We talk about offering new games in the digital space. A lot of it is based on that fact we should be there. Right now Atlantic Canadians and people around the world have a lot of choices of gaming products online,” Scrimshaw says. “The difference with us is our games are thoroughly tested, thoroughly regulated. We have aged controls and a whole series of other responsible gaming features and the profits from gaming, as they should, go back to the provinces.”

93 cents of every lottery dollar spent on Atlantic Lottery goes back go Atlantic Canada. This is a fact the company has been driving home with media campaigns over recent years. Though they have seen improvement, it’s something many people still don’t know.

“I don’t know whether it’s a bad connotation on lottery. I think most folks would recognize that draw games and scratch games and the like are a very soft form of gambling. It’s gambling for the most part,” Scrimshaw says. “Once people understand who we are and what we do, our reputation is strong.”

Intrapreneurship is playing a huge role in helping ALC’s address its challenges and create products and offerings. Scrimshaw says adopting this “startup” approach to problem solving is crucial to any customer-centric organization.

“At the end of the day, this company has been successful and profitable since its launch in 1976. That’s not surprise. But if you look at the changes in market dynamic that we’re in now, we have to think differently and operate differently,” he says. “And establishing that innovation team in this organization and the outpost we’re opening in Halifax is absolutely a game-changer for us. How we think, how we build, the cost of which we build, other ideas that we bring to play are all critical in developing games that are relevant to this new player.”

Scrimshaw’s long-term vision for ALC is for it to become one of the leading innovative lottery and gaming companies in the world.

“We’re the smallest lottery in the country. I think we’re the most innovative lottery in the country as well and frankly our reputation around the world would support that,” he says. “I think we are equipped to compete with anyone.”