Request for Proposals. For. Advertising Services. For the. Minnesota State Lottery. Answers to Questions. Date: December 30, 2015

Transcription

1 Request for Proposals For Advertising Services For the Minnesota State Lottery Answers to Questions Date: December 30, 2015 Page 1 of 18

2 The Lottery would like to thank the potential respondents for the thoughtful questions below. Note that along with these answers, the Lottery is issuing a second formal revision to the Request for Proposals for Advertising Services. It does not fundamentally change the scope of work. The Lottery would also like to thank the interested the interested agencies for their willingness to partner with the Lottery on its important mission. We understand there may be some hesitation regarding the time and effort needed to respond to the RFP. The Lottery wants to assure interested agencies that this RFP will be completed as scheduled. We have no reason to believe there will be further delays and we fully intend to sign a three year contract at the conclusion of this process. Thank you again. General 1. In reviewing the RFP, it reads largely digital in focus in terms of real needs but then appears to be a more general AOR arrangement. Are you expecting the responding agency to be digital agency with other traditional agency partners? Is there a particular focus you d prefer? The Lottery is looking for an Agency of Record or a Lead Agency with a corresponding team that can provide all marketing and advertising services. We are seeking a partner or team of partners that has enough bandwidth to provide thought leadership and tactical support as we continue to expand into non-traditional channels (social, mobile, programmatic display, etc.) but we also need strategic leadership from a holistic brand planning perspective and do not plan to abandon traditional tactics. We are interested in an agency partner that provides best in class talent to address our challenges and deliver the scope of work. If this talent resides in one agency, than we are happy to work with one agency. However, we are also open to the idea of our agency subcontracting with other firms to meet these demands. The Agency of Record or Lead Agency will be the one who provides the necessary strategic leadership and integration across channels that could be a digital agency, a creative or media agency, or a full service agency; we do not have a preference. 2. In reviewing the RFP, it mentions if an agency specializes in one area of advertising the agency will need to partner with additional agencies to full-fill this RFP. [We are] a full-service digital agency and will need to partner with an additional agency to complete this RFP. [] Does this appeal to you or are you preferring only local firms? Ideally, we want to have our Agency of Record or Lead Agency based in Minnesota. It does not matter if pieces of the scope of work are fulfilled by entities outside of the state. We want our dayto-day contact and other key points of contact to be in Minnesota. 3. Is the Lottery issuing this RFP only because the existing contract has expired? To the best of your knowledge, does the existing agency plan to again compete for the business? We are required by state law to seek best value for Minnesota via competitive procurement. We are also using this opportunity to modernize and optimize our marketing efforts. We plan on actively and fairly considering all potential bids to seek the best value for the State of Minnesota. Page 2 of 18

3 4. What are the three most important traits that you re seeking from an agency partner? We are looking for an agency or team of agencies that understands the Lottery s business initiatives so we can drive business on behalf of our important beneficiaries. Specifically: Expertise in development of break-through creative that appeals to the younger adult market; Ability to maximize media investment with a data-based approach to optimization; and Holistic and integrated team that takes a channel agnostic approach and provides comprehensive program support. 5. What are your candid feelings about the most recent lottery creative work? See the Lottery s response to Question 6, below. 6. What do you think works well (or doesn t work) with your most recent creative work? Over the past two years, we have been generally pleased with our efforts to re-energize the brand in a way that appeals to younger, new, and potential players. We have had some very successful campaigns and promotions supporting the brand and specific products (e.g. promotion related to The Walking Dead scratch ticket). We have also had challenges. We look forward to the next phase of the Lottery s brand development as we continue to address our challenges with breakthrough and innovative creative and media strategies. 7. Please fill in the blank: I wish the Minnesota Lottery stood for. The Lottery provides fun, thrilling and uniquely Minnesotan games of chance for Minnesota Adults of all ages. We want to continue to build our brand to be more relevant and cutting edge, especially with adult players between the ages of RFP/Process Related 8. Please clarify how many points the Written Proposal is worth? On page 11 of the RFP, it says 250 points, but on page 19 it says that it will be scored out of 200 points. The written proposal is worth 250 points. Please see the Second Amended RFP. 9. Can financial statements be added as an appendix outside of the 30-page count for the proposal? Yes. Please see the Second Amended RFP. Page 3 of 18

4 10. Page 21, Section 4.4 requests financial statements. Do those apply to the 30-page limit or should they be submitted separately? Please see the Lottery s response to Question 9, above. 11. Will you have anyone outside of the Minnesota Lottery organization included in the selection committee? No. 12. Can you provide more information about the details of the selection committee, especially the roles and individuals included in the presentation and the scoring? The selection committee is comprised of a cross-section of the Lottery s marketing and research departments that work closely with the Lottery s advertising partner. 13. Will there be opportunities beyond the actual presentations to engage with your team during the RFP process? Our process is designed to allow ample opportunity for chemistry and culture checks with the semi-finalist and finalist agency candidates: Semi-finalist Tele-session: each candidate will have the opportunity to submit questions that will be answered by the Lottery team during a 90-minute conference call; Semi-finalist presentation: there will be 30 minutes allotted to questions and answers; Finalist Agency visit: 4-hour work-session to collaborate on the finalist response, tour the agency and get to know the proposed team; and Finalist presentation: there will be 30 minutes allotted to questions and answers. Due to state procurement guidelines, no other contact between candidates and the Lottery team is allowed. 14. We understand that partners and subcontractors need to respond to the Agency Corporate Information as requested in Section 4.4. Do you require subcontractors to fill out the required forms in Section as well? No. Only the Lead Agency needs to fill out the forms in Section at this time. The Lottery, however, may require subcontractors to sign similar forms prior to contract execution. 15. Do the forms need to be completed by both the lead agency and sub-contractors/partner agencies? See the Lottery s response to Question 14, above. Page 4 of 18

5 16. Page 8 of the RFP refers to Appendix G, but we could not find this appendix on the Lottery website. Please advise. Please see Appendix F, which provides a summary of the most recent Lottery segmentation research, and the new Appendix G, which provides a summary of the 2014 SCSU Gambling Survey. 17. Page 8 of the RFP refers to Appendix G. When might this research be provided? Please see the Lottery s response to Question 16, above. 18. Are you looking to work with multiple agency partners in 2016? Please see the Lottery s response to Questions 1 and 2, above. 19. Page 19, Section asks for a compilation of creative work. Can that be a video or are you requesting it be a part of the written response? Is the 30-page maximum inclusive of the creative compilation? Please see Section 3.3 of the RFP. Agencies are encouraged to submit video or audio case examples as part of their written proposals. These video or audio examples should be on a DVD or USB drive, but cannot be hosted on the Internet. Video or audio examples do not count towards the page limit, but must be fully described in the text of the written proposal. 20. Page 20, Section asks, What processes are in place for financial stewardship? Please define financial stewardship, (e.g., agency invoicing or marketing return on investment). The Lottery defines financial stewardship as responsible management of the investment the Lottery is making. This includes accurate and timely estimation of anticipated production or other out-of-pocket expenses, efficient management of agency time, the timeliness and accuracy of media billing and payments, added value negotiations and more. Essentially, financial stewardship is the ability to effectively manage the investment. 21. Page 23, Section 5.1 asks that the pricing proposal include all required services listed in Appendix A. Would you also like us to supply proposed fees for additional services in a separate document? Agencies may supply proposed fees for additional services; however, agencies will be scored on their proposed fee for the required services listed in Appendix A. 22. Appendix A, Section A.6 asks that trademark searches and acquisition be a part of the scope of work and annual fee. May we separate out this cost as a separate, as-needed fee? No. Coordination of trademark searches and registrations is part of the required scope of work. Actual legal fees and costs, however, will be reimbursed on a net basis with no mark up. Page 5 of 18

6 23. Page 6 of the RFP notes there are six major state-wide Lottery campaigns that have already been designated. Will the winning agency be responsible for developing these campaigns in addition to other proposed approaches? Or are there only six campaigns? The Lottery will most likely have six annual promotions that will require a fully integrated campaign effort from the agency. Additionally, we will likely have a brand campaign, a beneficiary campaign and a trigger campaign to promote high Powerball and Mega Millions jackpots. We will have other minor initiatives that require creative input throughout the year. 24. How many concepts do you require for each of the ten (10) ticket designs? There is no firm concept number requirement. 25. Please provide additional details/clarification on the ten (10) new product concepts. a. What is an example of the type of ideas you are looking for? We are looking for a mix of ticket themes around pop culture, Millennials, sports, lifestyle, food, vacations, celebrities, etc. There really are few restrictions to what could be developed. b. What is the expected deliverable? Ten (10) concepts with a designed scratch ticket for each concept. 26. Page 15 indicates a preference for Targeted Group Businesses. How would you like us to indicate our TG certification? At what point in the process will the six percent preference be applied? Certified Targeted Group Businesses should indicate their status as part of the Price Proposal. The Six percent preference will be applied in accordance with Minnesota law and policy. Please see the Second Amended RFP. Media/Planning 27. In the RFP, it mentions your advertising spend is $7.5M per year, however, in your breakout the ad spends adds up to $3.9M. Can you please clarify your advertising spend? In the last fiscal year, hard media dollars spent was $3.9M. The difference relates to production, special events, non-traditional marketing, agency fee and other expenses. Page 6 of 18

7 28. Given the halt on online gambling in the state of Minnesota, should upcoming proposals center more heavily on the Lottery s current (i.e. traditional media) marketing offerings? Or are there new advancements in the works that the winning agency should consider, as a possible route for future development? Our current marketing efforts will focus on branding, traditional lottery scratch tickets, and Lotto tickets. We want to continue to use digital marketing to help us better drive awareness and sales of these products. 29. Page 6 of the RFP lists an advertising budget of $7.5 million for fiscal However, the RFP also mentions promotions and public relations are not considered advertising by statute definition. What is the overall budget for every aspect of 2016 marketing that the winning agency will either coordinate with and/or hope to leverage? We spend an additional $1.5M per year on promotions and event operations, we expect our agency partner to consult on this portion of the budget as well. 30. Will all campaigns be planned and purchased at once annually, and then adjusted and optimized throughout the year or will they be planned and purchased individually, with individual briefs, plans, presentations and approvals? Ideally, we will plan out 75% of the promotional plan prior to the start of the fiscal year. The remaining 25% will be developed as the year progresses. We would like to buy traditional media on a semi-annual basis with more frequent purchases and regular optimization of digital channels. 31. Where have you seen the most success in terms of media partnerships? We have a strong media partnership with Fox Sports North. FSN works to meet challenges of different campaigns and pro-actively creates opportunities to help highlight unique Lottery promotions through their programming and events. 32. As we develop a staffing plan for the media and digital scope, it would be helpful to better understand the following: a. Are multi-cultural audiences considered a part of the media plan? If so, what percentage of the annual media spend is allocated to multi-cultural audiences? Yes, they are included. We spend more than $200,000 with multi-cultural entities. No. b. Regarding Appendix A, Section A.3, are there any requirements for added value, (e.g., % of total spend)? Page 7 of 18

8 c. In Appendix A, Section A.3, timely is mentioned on a few occasions. When would you like to receive the post-buy analysis? Within 30 days. d. What is your current delivery system? We have an internally designed platform that sends out s to players. We are currently in the process of upgrading our CRM capabilities with a new system. e. Please outline the analytics tools you are currently using to measure digital engagement. We use a number of tools based on the channel. Tools include Google Analytics, Facebook Insights, Facebook Ads Manager, Twitter Analytics, Union Metrics, and ShortStack. f. On page 7, is the $600 thousand for digital media expenditures inclusive of paid social, mobile advertising and desktop advertising? Will you provide a detailed breakout of your FY15 digital media allocation? Optimizing our future digital media allocation is a question we will look to our advertising partner/s to help us answer. We are open to changing and/or tweaking our digital media allocation. g. What percentage of the current budget is allocated to SEO/SEM strategy and execution? None currently, but we want to develop an SEO strategy in the coming year. 33. Your RFP states that you have moved from making a traditional annual media buy to a semiannual model that allows for more flexibility to meet changing needs. Would you also be open to considering an alternative model of pricing rather than the 1,800 hours per FTE model called for in the RFP? We are open to considering an alternative model of pricing at some point in the future. To enable a fair comparison of responses, however, we require that you base your pricing on the FTE model at this time. Database 34. In the RFP, it mentions there is limited database marketing. Can you please clarify what data you do have on those 120,000 names? Is it just names, mailing addresses and/or addresses? The data we have on our database members includes all of the entry fields on our Players Club signup form, as well as any second-chance contests entered. Page 8 of 18

9 35. The RFP mentions there is a priority in building out marketing/promotional functionality of your existing user database. Can you outline that functionality and timing to implement, as well as how that functionality is proposed to better attract and/or retain the Lottery s target demographic? We are in the process of moving to a marketing automation solution that gives us a number of upgrades compared to our current system that will track, store, and analyze more data on our current database members and anyone visiting our site, giving us a more 360-degree view of our consumer. It will also help us better segment our digital audience, thus giving us more insight into their behaviors and what they want from us. We hope the new system to be implemented in the next 6 to 8 months. 36. How do you currently use the data? a. marketing We currently do not use any of the data we receive from campaigns to influence future ones, mainly due to the lack of data we receive from each campaign b. Mailings We currently do not do any direct mail campaigns. c. Digital Due to the lack of holistic insights and not having our own DMP, we do not use much data from digital campaigns to influence future ones. 37. Is there enough information to inform media? Please see the Lottery s response to Questions 35 and 36, above. 38. Do you currently have/use a DSP or DMP and if so, who do you use? We do not. 39. Do you have a DM team/person? Our current direct marketing efforts are managed by our Digital Marketing Manager. Page 9 of 18

10 40. According to the last line on page 8 of the RFP, Increased database marketing and CRM functionality is a priority over the coming year. However, it doesn t appear to be included in the work scope. If our assessment is correct, should it be part of the work scope? We are hoping to work with our agency partner to identify the right strategy for database marketing and CRM in 2016 as part of our annual planning process. The tactics to support this strategy would likely be estimated as additional scope. 41. Does the Lottery currently use a CRM platform? If so, which source? We currently use a homegrown system through our web development agency but are in the process of upgrading to a new system. See the Lottery s responses, above, for more information Research 42. Is there any persona or segmentations information currently being used? The Lottery has conducted several segmentation studies in the last few years, including studies of the general adult population, those who make up the market for gambling products, and Minnesota Lottery scratch players. Highlights of the most recent study may be found in Appendix F. 43. Who or what do you consider your competitors in terms of share of wallet? While the obvious competitors are those engaged in other gambling activities, we believe that our major competitors are other products sold in the retail environments where lottery products are found, particularly those items that might be considered impulse purchases and that are sold near cash registers. We also believe that other gaming options, especially those accessible on mobile devices, also compete for our target audience s time, if not their wallet. 44. Can you share any proprietary research that identifies the lottery s challenges, opportunities and perceptual trends? See, for example, Appendices F and G. 45. Can you share results comparing overall perception and conversion efficiency of marketing by category - including Digital, Social, Traditional Out of Home, TV, and Experiential? We have limited data that breaks this out by category. We believe that perception and conversion result from an overall messaging strategy and that while our customers are exposed to a very fragmented media environment, each channel has a role and it is critical that the brand experience be seamless from a customer perspective. 46. This past year the MN Lottery introduced 68 new scratch games, many of which were themed (Bearded Bucks, Hunt for Big Cash, Family Guy). Did any of the 68 new games drive significant increases in Lottery brand awareness? Can you share results for the impact of new Page 10 of 18

11 products in driving awareness and Lottery use by the target demographic versus traditional Lottery brand marketing? Brand awareness of the Lottery is extremely high and has been for quite some time. The challenge is to convert awareness to purchase. As we have been running brand marketing at the same time we have introduced new products, it is impossible to tell which of these has had the more significant impact on lottery use. 47. What information can you share with the agency to help with targeting efforts? a. Can you provide individual user data? b. Are there any legalities in using data due to being a government entity? We do not collect individual user data. This may change in the future, and all user data will be governed by the Minnesota Government Data Practices Act and other law. 48. Can you provide an example of the research conducted/provided to inform your promotional campaigns? See, for example, Appendices F and G. 49. How much research is conducted on an annual basis that the agency needs to review, analyze and interpret? a. What is the scale of the research (large or small)? b. How is the research usually delivered? c. What is the expected agency deliverable? The Lottery contracts with various research firms to conduct research and relies on these firms and lottery staff for analysis. We do not expect our advertising agency to conduct research, though we are always happy to consider proposals our agency may have. We do, however, expect our agency to be able to critically analyze our research, to participate in research presentations and discussions, and to intelligently advise us on research needs and plans. 50. We understand that you are interested in focusing on a new demographic. Will you be conducting research with your new agency partner, or will you already have conducted the research at the outset of the Contract? We do not ask our agency to conduct research. We instead rely on various research partners whom we work with under separate contracts. Lottery research is an ongoing process and we value our agency partner s input on the structure and strategy for new research initiatives. See Appendices F and G for examples of more recent research. 51. Given the information you shared about the scratch games increase and Lotto games decrease in sales for 2015, are there details about the YOY sales trends, yearly calendar cycles within demographics and individual games specifics you can share with us? Page 11 of 18

12 See a summary of the results from the 2014 SCSU Gambling Survey in the new Appendix G. Analysis of this data for 2015 is not yet complete. 52. What were your top 10 performing retail locations in FY15? In descending order: M&H Gas (Moorhead),MSP Airport Foundation, Orton s Moorhead Food Mart, Cub Foods (Crystal), Cub Foods (Maple Grove), Kwik Trip (Winona), Bill s Superette (Brooklyn Park), Holiday Station Stores (Rice St., St. Paul), East Grand Station (East Grand Forks), Cub Foods (Brooklyn Center). 53. What are your major corporate retail accounts? Please provide sales figures from the last year. In descending order, our top 10 corporate retail accounts are: Holiday Stationstores, Northern Tier Retail, Kwik Trip, Casey s, Coborn s, Supervalu, Erickson Oil Products, Diamond Lake 1994, Miller & Holmes, Jerry s Enterprises. Please note that this ranking does not include sales at franchise stores that do business under the same name as the corporate account. We decline to provide sales figures. 54. Can you provide sales figures by DMA or sales region? The Lottery has six sales regions. In FY15 their sales were: Region 1 (Northeastern Minnesota): $36,945,000; Region 2 (Northwestern Minnesota): $34,280,000; Region 3 (Southwestern Minnesota): $28, 114,000; Region 4 (Metro West): $77,054,000; Region 5 (Southeastern Minnesota): $50,483,000; Region 6 (Metro East): $109,362, Can you provide media spend by DMA for FY15? The Lottery s media spend is spread throughout Minnesota, roughly in proportion to population. Brand 56. Can you expand upon the lottery s reputation with the emerging player segment (ages 25-44)? This group generally has a positive or neutral opinion of the lottery. They are open to gambling and lottery play, but may not know how to play Lottery games, do not shop where lottery products are sold or have not tried lottery products previously. Please see the included research for more information. 57. Where do you feel your digital marketing efforts are delivering well and/or falling short? We have made a lot of progress over the last two years in trying to catch up to modern-day digital marketing and media techniques and best practices. We still have a lot of work to do in getting a centralized data warehouse set up and capturing cleaner data on current and future consumers across all of our digital platforms and channels. Once we are able to glean more insights from our data, we feel we ll be able to make more informed decisions on media and products for the future. Page 12 of 18

13 58. How would you like the Lottery brand to be perceived in two years? We would like the Lottery brand to be seen as fun, on-trend, proudly/uniquely Minnesotan, and an easy entertainment option that benefits all residents of the state. 59. What games aimed at millennials have worked? What games directed at millennials have not worked? Have you completed any customer journey mapping for millennials? The Walking Dead was a successful product that brought new players to the game but appealed to existing players as well. Cash & Concerts is a game that was specifically aimed at Millenials but did not meet expectations because of limited and poorly targeted advertising and promotion. We have not done a formal customer journey mapping. 60. Has Lottery brand awareness grown over the past two to three years? Lottery brand awareness has been, and continues to be, very strong. 79% of Minnesotans have a neutral or positive view of the Lottery. Rebranding efforts over the last two years have been successful and the new logo has been positively received by consumers. Lottery brand awareness has not grown because it was already extremely high. In a March 2014 survey 97% of Minnesota adults recognized the Minnesota Lottery logo after all identifying information had been removed. Digital 61. What are your future plans for allowing people to play the lottery on mobile devices? None at this time. 62. Has the Lottery considered marketing within chat applications including Snapchat, TapTalk, etc. and/or experiential environments including from outer space to attract the attention of Millennials? We have, but due to limited staffing resources, we have dedicated our time to building audiences on our already-established platforms and on ones that do not require so much on-the-fly content creation. Snapchat is a serious consideration going into How are the consumer targeting and engagement metrics provided to the agency? a. What is the deliverable? b. Is this the responsibility of the Lottery or the agency to gather and analyze? Our current agency gathers all of the data on our consumers from paid media campaigns and shares limited information with us on a quarterly basis. They are also the ones who currently choose all of the targeting parameters. Facebook Insights and Facebook Ads Manager is a sharedaccess platform between the Lottery and the agency, and we often collaborate on targeting and post-campaign analysis on that channel. In the future, the Lottery is looking for more of a shared Page 13 of 18

14 responsibility between itself and the agency as it relates to pre-, mid-, and post-campaign paid media decisions. 64. What are the expectations around real time optimization? a. Messaging b. Media c. Design We will expect the agency to coordinate with us based on real-time insights that each of us has equal access to. We will work together to decide what, if any, optimization needs to happen midcampaign, and we will look to the agency to make the changes as they relate to messaging, media, and design. 65. How do you manage online commentary, reviews and social listening for comments/complaints? Is that something you rely on your agency to manage, or do you manage internally? We believe in keeping all community management in-house for a variety of reasons, so we do not rely on our agency to manage that. We evaluate all comments made about us across social channels and determine whether each needs a response. 66. What is your social media strategy? At a very high level, our social media strategy is to provide a unique insight into the Lottery and its brand values by creating engaging content that inspires Minnesotans and ultimately leads to them purchasing a ticket. However, we do not believe in a product-first message strategy and instead on a content marketing approach, and our data shows that this works. 67. Why has Facebook garnered 130,000+ followers while Twitter only has 1,900+ and Instagram 784? There are a number of reasons, mainly because there was more time invested in the recent years in building the Facebook community. A healthy portion of our Facebook audience came from paid Like campaigns and running contests that encouraged Liking our Page. Twitter and Instagram continue to grow on a daily basis and more time is being invested in growing those communities. 68. Where do you have gaps in the process of digital media planning, execution, measurement and optimization? We are continuously working with our partners to fill gaps that arise from time to time. In general, we are looking for ways to continue to modernize and optimize our digital advertising efforts. Page 14 of 18

15 69. On page 6 in the fourth bullet, are these digital objectives in priority order? What are your top three digital goals/kpis? Those objectives are not listed in priority order. Our KPIs change per campaign, but ultimately, we are looking to build our database with a larger market of millennials and provide them with content that matters to them so that we can get them into a retail store to try out a game. Events 70. Please elaborate on what you mean by developing partnership opportunities. The Lottery works with Minnesota companies, brands, individuals and other state agencies to develop marketing partnerships. These could include a scratch ticket game design, co-branding, shared advertising or contest promotion. 71. What has been the lottery s most successful event to date and what made it so successful? Our most successful launch event recently was the Walking Dead media event. It included zombies riding light rail trains and disembarking on Government plaza in Minneapolis where we held a media/public event. The amount of social sharing and extensive, positive media coverage made it successful. 72. The MN Lottery emphasized experiential marketing in the previous fiscal year. Can you share metrics for brand events, like the Bearded Brew Tour, to help illuminate if/how experiential marketing effected the primary demographic s propensity to purchase lottery tickets/scratch games or their overall brand affinity? The Brew Tour audience was too small and recent to have an impact on demographic market research. However, consumer interaction and responses were positive and provided opportunities for sampling with a consumer base that had limited prior experience with Lottery products. 73. Please provide examples of the types of events the Lottery participates in on an annual basis (large and small scale). The largest event would be a booth at the Minnesota State Fair with 1.8 million in attendance. A small event would be a 1-day event at Mall of America, with 1,000-3,000 participation and exposure to 50,000. Media events to launch a product or program would be the smallest and most targeted events that the Lottery executes. 74. In addition to ideating event strategies will the agency be responsible for event management and execution? Not typically. There may be event aspects that the agency would be asked to source/coordinate. For example, hiring actors/street teams or finding a production company to produce a prop or set piece. These activities would likely be considered out of scope. Page 15 of 18

16 75. Does the agency need to provide design services for the events? The design for materials to support the majority of Lottery events are handled in-house. There may be some events designed for advertising campaigns that would need additional design support. 76. Page 20, Section asks for our process for event and sponsorship evaluation. Understanding the number of potential sponsorships, events and associated costs will be helpful in developing a staff plan. Can you provide current investment levels for your sports, event and media sponsorships? Are sponsorship costs included in the media budget? Ad agency help is utilized to evaluate and assign market value to the media components of proposals from properties and events. Budget allocation, portfolio and investment level decisions are handled by Lottery staff. It is anticipated that there will be probably proposal evaluations annually. Public Relations 77. Regarding PR, what tasks are typically owned in-house vs. by the agency? The Lottery PR team handles routine press releases, crisis management, public responses and winner processing. The Agency PR team may be responsible for targeted media outreach for campaign launches and events. Typically, there have been 4-6 opportunities per year. 78. Name a dream PR story or placement for the lottery. Positive or unique winner story/video is picked up by all Minnesota TV networks/radio/digital media across Minnesota, generating social sharing and chatter. 79. In addition to promoting games and winners, what other kinds of PR coverage do you value? Connections to recipients of lottery funding (beneficiaries) is valued, as well as promoting partnerships that benefit Minnesota and increase Lottery brand value. 80. Who is the audience for the earned media training and what is the expected outcome/ deliverable? It may be a hired spokesperson or celebrity or Lottery employee who is doing media interviews on behalf of the Lottery for a specific campaign/product. Training should include talking points and interview advice. The expectation would be that the spokesperson would understand the product, its benefits and attributes, and be able to hit talking points in an interview. Page 16 of 18

17 Other 81. The RFP defines the need for the Minnesota Lottery to increase sales by reaching new audiences. Does the Minnesota Lottery have sales and contribution goals established for the extent of the contract? We do not have those goals projected out for beyond this fiscal year. We had record profits last year and our 2nd highest sales ever. We budgeted for a modest gain (3%) for this fiscal year. 82. Is there one state lottery that you believe sets the marketing bar for all other state lotteries? If so, which one and why? Colorado does a nice job reaching Millennials and highlighting their beneficiaries, California has good creative, Michigan does very well in database marketing. 83. What have been your most common pain points when working with agency partners? See the Lottery s response to question 84, below. 84. What has worked well with the existing agency that you would like to see replicated? What did not work well with the current agency? We have had the most success when agency partners understand the specific goal and create an integrated campaign that reaches that goal. We continue to focus on great strategy that sets the lottery apart with strong creative execution developed to meet that strategy. Like many retail accounts, the relationship can be challenged by a fast paced retail environment which is somewhat exacerbated by time consuming government regulations. But, this difficulty is often counterbalanced by the Lottery s small and empowered marketing team and their desire to be led with innovative thinking. 85. What is the current engagement from second chance contests? a. What consumer demographic is participating? The current demographic of second chance entries in in direct proportion to our player base. Our tracking data for the quarter ending September 30, 2015, states that 16% of lottery players have entered a second chance contest at some point, and that 12% had done so in the past year. b. Do you see this changing in the future? Ideally, this should be greatly expanded with younger adult demographic (22-40 year olds) in the future. We know that 53% of past year participants were male and that 24% were between the ages of 18 and 34, 58% between the ages of 35 and 64, and 18% were 65 or older. Page 17 of 18

18 86. What other state lotteries do you admire for their marketing? See the Lottery s response to question 82, above. 87. What does success look like in December 2016? In three years from now? We will continue to define success on increased profits given back to the state of Minnesota. Equally important to our longer term success will be increasing the percentage of year olds that play the Minnesota Lottery at least once per year. We track these numbers annually. By January 2019, we would like to have at least 100,000 new Lottery players in the year old demographic. 88. Could you share with us the decision-making process you will follow? Who are the decision makers? We have a small group of decision makers relative to marketing and advertising decisions. All decisions are made by the Director of Marketing, Marketing Manager, New Media Manager, and Executive Director. 89. Who creates the games and the ticket designs that are part of your program? 90% of scratch tickets are concepted and designed by lottery vendors. The Minnesota Lottery has aggressively looked to take on more of the concepting and design internally or through our agency. In the coming years, we want to produce 20-30% of concepts and designs through Lottery staff or agency staff. Page 18 of 18