The German betting company JAXX AG has reason to be pleased with the performance of its relatively new Spanish lottery subsidiary DigiDis, which is out-performing predictions and could be delivering business worth $30 million by 2009.
JAXX, which owns 70 percent of DigiDis, released a statement at the end of October revealing that it is benefiting more than previously expected from the spread of online lottery activities in Spain. New partnerships and sales channels are proving to be a source of dynamic, profitable growth for DigiDis, says JAXX financial director Stefan Haenel, who had previously only expected the Spanish company to reach profitability but now anticipates a profit of half a million Euros.
Haenel revealed that DigiDis expects to see the volume of lottery agency business double to Euro 30 million in 2009, and profits are set to treble.
Shortly after tickets for the popular Christmas lottery ‘El Gordo' went on sale, DigiDis secured a partnership with the internet portal MSN, one of the biggest online services on the Iberian peninsula. This was preceded by the clinching of a venture involving Spain's largest publisher Prisa, which is the company behind the daily newspaper ‘El Pais'.
DigiDis' online network, which also includes partners such as Yahoo and Terra, is used for the marketing of all Spanish lotteries and of the pan-European ‘Euromillions'.
Sascha Badelt, Managing Director of Madrid-based DigiDis said: "This year we will be able to reach Spain's entire internet community with our lottery products. For the first time we will be using sales channels other than the internet for marketing Euromillions and the Spanish lotteries." To that end, DigiDis has enlisted the services of one of the largest call centres in Spain for telesales of lottery tickets.
New syndicate products for Euromillions and the Spanish lotteries have also been launched by DigiDis. These products, which are sold for example in partnership with the Spanish subsidiary of the Bertelsmann Book Club, are based on a concept that JAXX originally created for the German market.
"Our business success in Spain is emerging as a key strategic factor," says Haenel. "Whereas lottery agency business in Germany has been paralysed by the regulatory debate raging there, we are exporting our systems and business models profitably to other European markets. We expect that as early as next year, business in Spain will go a long way towards compensating for the expected sales downturn in Germany. And the higher margins earned there mean that our earnings will look even healthier."