1. Internet Initiatives Presented by Jenny Canfield Director for Operations

2. INTERNET INITIATIVES Why Should We Care? *Decline in Lottery Participation*  Only 38% of 18-24 year olds have bought a lottery ticket in the last year in MN – in 1998 the participation rate was 73%  Only 56% of 25-34 year olds have bought a lottery ticket in the last year - in 1998 the participation rate was 70%  The overall lottery participation rate was only at 75% Source – St. Cloud State University Survey

3. INTERNET INITIATIVES Why Should We Care? *E-Commerce Trends* US Retail E-Commerce Sales, 2002-2014 (billions and % change)

4. INTERNET INITIATIVES Why Should We Care? *It’s where our players are*  Over half the adult internet population is between 18 and 44 years old  Social networking use among internet users over the age of 50 has nearly doubled  Facebook  Over 500 Million Active Users  53% of Active Users Player Games Online  56 Million Users Play Daily  290 Million Users Play Monthly  US Consumers play Internet/Online Games more often than any other type of video games Source – Pew Internet Research Facebook.com

5. Likeliness to Spend Real Money Playing the Following Games on the Internet January 2010 If legally permitted and regulated by government Lottery tickets Poker Sports Betting Horse Racing Fantasy sports pools Blackjack Bingo Internet casinos Skill games Source - IPSOS – REID Survey INTERNET INITIATIVES Why Should We Care?

6. WHAT CAN YOU DO NOW Be PROACTIVE VS. REACTIVE  Determine long-term goals and objectives  Establish short-term strategies to lead you to long-term goals and objectives  Build Player/Loyalty Club Base  Established a strategy to slowly introduce Interactive internet games Interactive internet games  Subscription Packages  Social Media  Mobile Services

7. MINNESOTA LOTTERY’S PLAYER’S CLUB  Started in May, 2006  Launched over 30 promotions last year

8. MINNESOTA STATE LOTTERY’S ONLINE INTERACTIVE GAMES  Free interactive game play  Interactive game play tied to non- winning tickets winning tickets  Online 2 nd Chance Promotions  Add new levels of interactive games

9. Simple Interactive Games Games that are provide interaction and are extended play and are extended play Simple Reveal Games Simple Reveal Games

10. Internet game appeal  Almost 402,213 games started in the first 4 months  48,434 times a player played more than one game per day  Average of nearly five games played per person daily More Advanced Interactive Games Hold’em

11. TEXAS HOLD’EM INTERACTIVE GAME Multiple Game Options

12. TEXAS HOLD’EM INTERACTIVE GAME  Virtual games played- 27,608  Live games played- 402

13. What’s next for Interactive Games

14. Digital Strategy Continue Research and Analysis Continue Research and Analysis Incorporating more social media components Incorporating more social media components Develop a cohesive Lottery experience across all digital platforms Develop a cohesive Lottery experience across all digital platforms Implement a scalable architecture that allows for growth and expansion Implement a scalable architecture that allows for growth and expansion Create deeper engagement and loyalty with our Members Create deeper engagement and loyalty with our Members

15. THANK YOU!