This case is accompanied by a Video Short that can be shown in class or included in a digital coursepack. Instructors should consider the timing of making the video available to students, as it may reveal key case details.Describes the role of state lotteries, lottery marketing, and the operation of the Massachusetts State Lottery, including reference to Massachusetts lottery advertising. Highlights the success of state lotteries while also noting growing criticism, particularly of their advertising. Teaching objectives: To consider 1) truth in advertising, 2) the ethics of marketing gambling, and 3) the marketing/public policy interface.
Authors :: N. Craig Smith, John A. Quelch, Ron Lee
Swot Analysis of "Massachusetts Lottery" written by N. Craig Smith, John A. Quelch, Ron Lee includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Lottery Lotteries facing as an external strategic factors. Some of the topics covered in Massachusetts Lottery case study are - Strategic Management Strategies, Marketing, Policy and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Massachusetts Lottery casestudy better are - – digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%,
wage bills are increasing, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Massachusetts Lottery
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Massachusetts Lottery case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lottery Lotteries, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lottery Lotteries operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Massachusetts Lottery can be done for the following purposes –
1. Strategic planning using facts provided in Massachusetts Lottery case study
2. Improving business portfolio management of Lottery Lotteries
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Lottery Lotteries
Strengths Massachusetts Lottery | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lottery Lotteries in Massachusetts Lottery Harvard Business Review case study are -
Ability to recruit top talent
– Lottery Lotteries is one of the leading recruiters in the industry. Managers in the Massachusetts Lottery are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Massachusetts Lottery Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Sustainable margins compare to other players in Sales & Marketing industry
– Massachusetts Lottery firm has clearly differentiated products in the market place. This has enabled Lottery Lotteries to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Lottery Lotteries to invest into research and development (R&D) and innovation.
Ability to lead change in Sales & Marketing field
– Lottery Lotteries is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Lottery Lotteries in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Lottery Lotteries is one of the most innovative firm in sector. Manager in Massachusetts Lottery Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Lottery Lotteries has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Highly skilled collaborators
– Lottery Lotteries has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Massachusetts Lottery HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Lottery Lotteries has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Massachusetts Lottery Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Superior customer experience
– The customer experience strategy of Lottery Lotteries in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Lottery Lotteries is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Lottery Lotteries is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Massachusetts Lottery Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Lottery Lotteries is present in almost all the verticals within the industry. This has provided firm in Massachusetts Lottery case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Effective Research and Development (R&D)
– Lottery Lotteries has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Massachusetts Lottery - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Massachusetts Lottery | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Massachusetts Lottery are -
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Lottery Lotteries supply chain. Even after few cautionary changes mentioned in the HBR case study - Massachusetts Lottery, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Lottery Lotteries vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study Massachusetts Lottery that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Massachusetts Lottery can leverage the sales team experience to cultivate customer relationships as Lottery Lotteries is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Massachusetts Lottery, it seems that the employees of Lottery Lotteries don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Massachusetts Lottery HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Lottery Lotteries has relatively successful track record of launching new products.
Lack of clear differentiation of Lottery Lotteries products
– To increase the profitability and margins on the products, Lottery Lotteries needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Massachusetts Lottery, is just above the industry average. Lottery Lotteries needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow decision making process
– As mentioned earlier in the report, Lottery Lotteries has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Lottery Lotteries even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Increasing silos among functional specialists
– The organizational structure of Lottery Lotteries is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Lottery Lotteries needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Lottery Lotteries to focus more on services rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Lottery Lotteries is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Massachusetts Lottery can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Lottery Lotteries has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High operating costs
– Compare to the competitors, firm in the HBR case study Massachusetts Lottery has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Lottery Lotteries 's lucrative customers.
Opportunities Massachusetts Lottery | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Massachusetts Lottery are -
Leveraging digital technologies
– Lottery Lotteries can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Lottery Lotteries can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Lottery Lotteries can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Buying journey improvements
– Lottery Lotteries can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Massachusetts Lottery suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Low interest rates
– Even though inflation is raising its head in most developed economies, Lottery Lotteries can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Lottery Lotteries in the consumer business. Now Lottery Lotteries can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Lottery Lotteries has opened avenues for new revenue streams for the organization in the industry. This can help Lottery Lotteries to build a more holistic ecosystem as suggested in the Massachusetts Lottery case study. Lottery Lotteries can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Lottery Lotteries can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Lottery Lotteries can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Lottery Lotteries is facing challenges because of the dominance of functional experts in the organization. Massachusetts Lottery case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Better consumer reach
– The expansion of the 5G network will help Lottery Lotteries to increase its market reach. Lottery Lotteries will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Lottery Lotteries to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Using analytics as competitive advantage
– Lottery Lotteries has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Massachusetts Lottery - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Lottery Lotteries to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Massachusetts Lottery External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Massachusetts Lottery are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Lottery Lotteries will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Technology acceleration in Forth Industrial Revolution
– Lottery Lotteries has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Lottery Lotteries needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Massachusetts Lottery, Lottery Lotteries may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Lottery Lotteries in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Shortening product life cycle
– it is one of the major threat that Lottery Lotteries is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Lottery Lotteries demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Lottery Lotteries business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Lottery Lotteries
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Lottery Lotteries.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Lottery Lotteries.
Environmental challenges
– Lottery Lotteries needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Lottery Lotteries can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Lottery Lotteries with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Massachusetts Lottery Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Massachusetts Lottery needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Massachusetts Lottery is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Massachusetts Lottery is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Massachusetts Lottery is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Lottery Lotteries needs to make to build a sustainable competitive advantage.