The way prize draws fit into the UK’s gambling framework has been up for debate lately, with the Lotteries Council arguing that there is a regulatory imbalance between how prize draws and lotteries are controlled and overseen.
In this op-ed, James Mieville, Executive Director at Raffle House, one of the UK’s two biggest prize draws alongside Omaze, argues that the product is catering to a player demand that isn’t being met by regulated gambling products.
The early months of this year have seen suggestions prize draws pose a threat to some parts of the regulated gambling market, with the implication other products could be suffering due to prize draws such as ours. Not only is there no evidence to support such suggestions, the debate is distracting attention away from the huge opportunity in this area.
In his speech at ICE, UK Gambling Commission (UKGC) CEO Andrew Rhodes said prize draws were now taking almost as much revenue as betting. He repeated this at the Betting and Gaming Council (BGC) AGM the following month, leading some igaming industry publications to run stories claiming he believed prize draws might be cannibalising regulated products.
It’s worth noting that’s not what he said in either speech. However, there was no ambiguity about the report put out on prize draws by the Lotteries Council last month, which repeatedly described prize draws as a “threat” to their operations.
Lotteries claim prize draws have an unfair advantage as they exist outside the regulated gambling space. In response to such claims, we have pointed out other parties are free to adapt their model so they are also able to run such draws.
Tapping into unmet demand
And while some have claimed there are lotteries considering doing so, so far we’ve not actually seen this happen. Putting the debate about the regulatory position aside, the bigger point here is that there is clearly demand from players for competitions that give away houses and this isn’t being met by regulated gambling verticals.
There’s something about the idea of winning a luxury home that appeals to people and that’s the player base we are targeting. We’re not aiming to attract those who play lottery or partake in betting – the idea one would choose to spend £10 on a house draw they otherwise would have put on their favourite football team is far-fetched. Prize draws and betting are totally different propositions aimed at very different audiences.
To some extent, the argument made by lotteries is more plausible, given both types of competition are ultimately offering the chance to win something life-changing.
But prize draws such as ours have been running for several years now – we’re about to launch our 20th Dream Home giveaway – and there’s still no evidence regulated lottery products are suffering as a result.
Indeed, Rhodes highlighted in the aforementioned speeches how well society lotteries were doing, noting sales had risen above £1 billion for the first time. The Lotteries Council report also conceded that, “evidence does not currently support the thesis that prize draws are yet supplanting charity lotteries”.
It’s true the last few years have seen National Lottery sales oscillate. However, any slight dips in some years are more likely to have been caused by the rise in society lottery sales or the first change in the National Lottery operator for 30 years than prize draws.
Data doesn’t lie
We also believe house draws attract a different type of player to lotteries. This is supported by the data we receive from Experian, which looks at how our players compare to the average Experian user.
This shows that a higher proportion of our players live in city centres, especially London and the South East, and many are at the more affluent end of flat dwellers. Fewer than average live in country areas or in detached houses. This suggests our players are attracted by the idea of the lifestyle change offered by the type of semi-rural stately homes typically on offer in our draws.
Admittedly, it’s difficult to compare the characteristics of our players with regulated betting products as the Gambling Commission data is not that granular. But there are some key differences we can see from what’s available. While GC figures show that lottery players are heavily skewed towards those in the over-45 age groups, our player base is more evenly spread between the ages of 26 and 70. And while betting and casino games are heavily male dominated, our player base shows a slight bias towards females.
The idea of winning a house taps into a dream of home ownership that is becoming increasingly difficult for many people to attain. It’s therefore no surprise house competitions are attracting many new players from broader demographics than traditional gambling products.
And while the regulatory position and models used may be different, examples from overseas suggest such draws have universal appeal. Zeal’s 2024 results reported that its first charity house raffle in Germany exceeded all expectations, selling 14 million tickets between August and October last year.
Last year all five properties from the 2024 season of Australian renovation reality TV show The Block were offered as a giveaway in an online prize competition. The competition was so popular that the live drawing of the winner had to be postponed after high volumes of traffic caused the website to crash.
It seems evident consumers love the idea they could win a house, but it’s not evident this comes at the expense of the revenues of lotteries, betting or gaming. Perhaps rather than worrying such competitions might affect their businesses, more people in the industry should take note of their potential.