New York, New York (NetworkNewsWire) – Thanks to
subscription-based business models, consumers are not left to
wonder what the best buying decisions may be. Companies that offer
subscriptions can provide customers with a multitude of services
bundled together, whether the product is streaming television
programs, design or sales software, or purchasing and managing
lottery tickets. On the corporate side, subscription services have
enabled companies to be more flexible and scalable toward their
offerings while providing them with greater, more predictable
revenue. LottoGopher Holdings (OTCQB: LTTGF) (CSE: LOTO) (FRA: 2LG)
(LottoGopher
Profile) is one example of a company that has succeeded with
its subscription model. Targeting the 80 million consumers in the
U.S. who purchase lottery tickets regularly, LottoGopher offers
daily, monthly and annual subscriptions to customers in California,
with plans to scale up its presence in 22 other states over the
next few years. This service builds on the success of large
providers such as Netflix, Inc. (NASDAQ: NFLX) and Amazon.com, Inc.
(NASDAQ: AMZN), as well as software companies Adobe Systems, Inc.
(NASDAQ: ADBE) and Salesforce.com, Inc. (NYSE: CRM).
As a lottery messenger service cognizant of consumer demand for
convenience, LottoGopher
Holdings (LTTGF) enables people to buy lottery tickets legally
in California, at the same price as at a store, with a debit or
credit card. Featured on NBC, CNN, CBS News, ABC and Fox News, and
in Forbes, Time and the Los Angeles Times, the
company is an increasingly recognizable brand. The company’s
success and anticipated growth are anchored to the conveniences
that it offers to subscribers. LottoGopher subscribers maintain an
account balance, which is updated after each drawing, while the
system secures tickets directly from the lottery retailer.
The emerging company has seen positive signs during its testing
period. Among visitors to the site, 7 percent provided their email
address, 43 percent of those who signed up via email became
members, and 12 percent of freemium plan members converted to paid
memberships. The company’s goal is to create a subscriber base of
approximately half a million paying members by 2020 in an effort to
achieve nearly $50 million in annual revenues — a mission that
accompanies its plan to expand its reach into 22 other states.
As the subscription numbers grow, LottoGopher continues to
adjust its features to address the modern consumer. Most recently,
the company announced its ongoing integration of a payment
processing solution that will allow members to pay via bitcoin and
Ethereum.
"In the past few months we have seen an uptick in subscriptions
and we want to continue this momentum. By making it as convenient
as possible for our members to order Powerball, Mega Millions and
SuperLotto Plus, we are continuing the mission to really target
millennials. Integrating with a solution that accepts digital
currencies is part of this ongoing strategy," James Morel, founder
and CEO of LottoGopher, stated in the news release (http://nnw.fm/2RisV). "In short order we will have the
processing ability to accept bitcoin and ether, a safer, quicker
and anonymous way to transact in this new digital-driven day and
age."
LottoGopher members can currently purchase lottery tickets via
the LottoGopher website, making “lost” lottery tickets a thing of
the past. They can also receive alerts, strategies and access to
lottery news, and they can play individually or pool winnings as
members of public or private groups online.
Strategic partnerships play an important role in LottoGopher’s
business model. Its Lottoland partner has been ranked as one of
Britain’s Top 30 fastest-growing companies, per a Financial Times
FT1000 Report. Since first offering its online lottery services in
2013, Lottoland has achieved $357 million USD in annual sales,
marking a revenue increase of 820 percent between 2012 and 2015
(http://nnw.fm/2Z8xT).
Like many other companies in the subscription space, LottoGopher
sees exponential potential. The company’s niche in this space
enables it to secure a spot in the $70 billion U.S. lottery
industry, which is 4x the size of the sports industry and 10x
larger than the music industry.
Another solid example of the potential of paid subscription
services is Netflix, Inc. (NFLX), which sells
subscriptions rather than the individual movies available in its
catalog. As an aside, it is worth noting that, while movie
subscription sales have far outpaced those at the box office,
lottery tickets sales exceeded movie ticket purchases sevenfold,
according to a 2015 CNN report. With Netflix, members pay a monthly
fee and can watch as few or as many movies, TV shows, documentaries
and Netflix originals as they want. This same model is applied by
LottoGopher; in fact, the model is so comparable that even the
monthly subscription rates are similar – at around $8 to $12 per
month. In Q2 2017, membership for the streaming service grew from
99 million to 104 million, while revenue grew 29.6 percent
year-over-year.
Netflix offers an array of additional features that keep its
subscribers on deck. The streaming service lets users play, pause,
rewind and resume watching, and there are no commercials. Also,
content can be downloaded to computers, tablets, and mobile
devices. The company also offers other bonuses to customers, such
as a one month free trial for new members.
Amazon.com, Inc. (AMZN) also offers a
successful, recognizable subscription service. Launched in the U.S.
in 2005, its Amazon Prime service offered perks such as free
shipping. Since then, Amazon has added video and music streaming
services, access to books, audio content, games, and photo storage
under the Prime brand. Members also receive rewards bonuses by
using Amazon Reward or Prime Store cards, and even paying with
debit through the Amazon Prime Reload program. According to
Statista (http://nnw.fm/5hgHw), subscribership for Amazon Prime
reached about 85 million in July 2017, compared to 41 million in
March 2015. Consumer Intelligence Research Partners has also
discovered that subscription members spend more than non-members
(about $1,300 compared to $700 per year). On average, Prime members
are privier to spending and tend to be more loyal customers.
Adobe Systems, Inc. (ADBE), a leader in
cloud-based design software, reported approximately $1.77 billion
in revenue for its best second quarter in its history, while
subscription revenue increased 37 percent for the quarter to $1.48
billion. Roughly four years ago, Adobe distanced itself from the
traditional sales model and, in a move that initially generated
considerable consumer backlash, instead offered its solutions in a
variety of packages ranging from $20-$50 a month. As noted in a
recent Motley Fool article, the decision to keep course on the
subscription-based business model has positioned Adobe for
continued success (http://nnw.fm/fq59A).
Salesforce.com, Inc. (CRM) is a leader in
enterprise and CRM software, in the second quarter of fiscal 2018,
becoming the first enterprise software company to break $10 billion
in revenues. Focused on subscription cloud services that perform
the same functions as traditional, costly in-house systems, the
company realized a 26 percent annual increase in subscription and
support revenues. Revenues for that segment were $2.37 billion,
accounting for the majority of total second-quarter revenues of
$2.56 billion. Salesforce has demonstrated how
software-as-a-service and pay-as-you-go models can yield impressive
numbers, and expects full-year fiscal 2018 revenue to increase
between 23-24 percent to $10.3 billion to $10.4 billion.
The above leaders are prime examples of how subscription sales
can generate income over the long term and in a variety of consumer
applications. As LottoGopher continues to evolve its offerings to
meet consumer demands, the company can look to the success stories
of industry behemoths such as Netflix, Amazon, Adobe and Salesforce
to carve its own unique spot in the subscription-based space via
the $70 billion lottery market.
For more information on LottoGopher, please visit:
(LottoGopher
Holdings)
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