South Africa’s National Lottery - also known as LOTTO - has grown into a popular value-added service (VAS) since its launch in early 2000. The vast majority of retailers still approach distribution similarly to how they did two decades ago; tickets are sold at kiosks and designated points-of-sale in store. However, over time, the sale of LOTTO tickets in the banking sector has evolved, demonstrating that there’s an opportunity for retailers to tap into selling digital goods and services online.

The 2022 Digital Goods and Services Report lists LOTTO among the top six VAS products in the country, accounting for 9% of all VAS sales volumes. Not only this, but the most common LOTTO purchasing frequency is on a weekly basis, with the majority of transactions valued between R21 and R50. 

In close competition with this, sports betting appears in second place on the top six list, having shown the biggest growth from 2020 to 2022 and making up 16% in volume of the total VAS market in the country. The quick rise of sports betting came from the surge in online entertainment during the 2020 national lockdown and has been further fueled by the relative novelty of online betting platforms. 

However, sports betting rose up the ranks at a time when the National Lottery had already started to build out its online portfolio, giving LOTTO room to stay relevant and expand to other channels.

Making digital moves

LOTTO has undergone a number of changes to expand its digital presence. From adding new games to its portfolio to nurturing digital distribution partnerships, it has been an ongoing journey with ample potential for growth.

Leveraging digital channels

Over the last few years, LOTTO players have been able to purchase tickets online, either from ITHUBA’s website or from bank apps. Before the COVID-19 pandemic, tickets purchased from banks accounted for approximately 14% of total LOTTO sales - a number that increased to above 40% by 2022, with the most popular game sold on bank apps being PowerBall.

Automatic payouts for online winners

LOTTO introduced automatic payouts for winnings up to R250 000 where verified players have bought their tickets on their bank apps. The prizes are credited into winners’ accounts, reducing claims administration and waiting times. However, if a player’s winnings exceed R250 000, they must be claimed in-person at a national or regional office, accompanied by the relevant paperwork. 

The leading Mobile Network Operators (MNOs) in South Africa also have online LOTTO offerings. The VodaPay super app states that winnings up to R50 000 are loaded into the winner’s digital wallet. Where the winnings exceed R50 00, a notification will be sent out to let them know they can lodge a claim physically.

Automated random number generation

Bank apps that sell LOTTO have random number generators that make it possible for consumers to buy Quick Pick tickets. Rather than requiring your customers to think about and select each individual ticket number, this functionality enables customers to conveniently play with randomly selected numbers. Not only is it convenient, but it also adds to the range of methods for playing.

Additional games

According to the ITHUBA 2021-2022 Annual Report, the operator has added 20 instant online games to its EAZiWIN catalogue, which provide players with results in real-time and offer a variety of prizes. The operator also added Sportstake 8 and 13, Daily LOTTO (since March 2019), and most recently the online-only Progressive Jackpot (since January 2023). These games are part of an expanded offering that can create more ticket-buying opportunities for businesses that have them on their online platforms.

Online players winning

While in-person purchasing channels are currently the most preferred, there has been an increase in the use of bank apps to buy LOTTO tickets. In the 2020 Value-Added Services Report, bank apps were the preferred channel for 8% of consumers, whereas the 2022 Digital Goods and Services Report showed a significant increase to 17%. This signals that, although physical channels are in the lead, consumers have become accustomed to the convenience of purchasing tickets from digital platforms - and your business can meet them where they are.

• In 2022, most LOTTO jackpot winners had purchased their tickets from FNB’s bank app. While this data is only based on division one winners, it’s an additional testament to the growth of online ticket sales.

• In 2023 alone, ITHUBA has announced 16 winners (as at 26 August) who purchased their winning tickets from a variety of bank apps. 

Add LOTTO to your offering through expert partnerships

Quoted in an article published by the Public Gaming Research Institute, the CEO of ITHUBA (South Africa’s National Lottery operator), Charmaine Mabuza, spoke about the importance of active collaboration with “tech experts, business experts, and industry stakeholders” to grow LOTTO and ensure that the organisation thrives. She further elaborated on the role of partnerships in making its games more accessible to consumers, all of which contributes to increased digitisation of the National Lottery.

If you are already selling LOTTO through traditional in-store channels, the opportunity is clear. Your business can better cater to the modern consumer by expanding to an omni-channel offering that includes an online digital goods and services portfolio. In addition to the convenience it brings for your customers, adding LOTTO to your online store and/or app keeps your business relevant and top of mind for other day-to-day purchases and transactions. 

A recent case study showed how one bank grew their VAS portfolio using Electrum’s Digital Goods and Services Platform to add LOTTO to their app. 

Is your business looking for a tech partner that can manage the transaction lifecycle of LOTTO purchases, monitor transactions, facilitate daily reconciliation, and more? Contact us today.