Gulf’s first weekly lottery eyes expansion as revenues rise

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• Mahzooz sales have risen since game format was tweaked last year
• Change came after users said it should be easier to win the jackpot
• Players enter by buying bottles of water, which are given to the needy

Sales for Mahzooz, the Gulf’s first weekly lottery, have surged since the game’s format was tweaked to make it easier to win, its operator has told AGBI.

The change last November was prompted by the players themselves, according to Farid Samji, co-CEO of Ewings, the Dubai-based company that runs the game.

“The feedback we got, after doing a proper survey, was: ‘Can you make it easier to win?’,” he told AGBI. “How do you make the game easier? You change the probabilities, you change the chances, you make it easier, which is what we did.”

To win the top prize of AED10 million ($2.7 million), players now have to match five winning numbers from a pool of 49 – rather than six from 49.

Samji declined to reveal Mahzooz’s precise sales, but said: “We have had tremendous growth. Every month our revenues have grown double digits.”

This increase in revenue has helped Ewings achieve profitability, he added, and the company is now in talks to expand to other Gulf markets and beyond.

Since gambling is forbidden in Islam, people who want to play Mahzooz – Arabic for “lucky” – buy a bottle of water for AED35. The water is distributed to workers in UAE labour camps and each bottle purchased gives the player one entry in the Raffle Draw, which offers three weekly prizes of AED100,000, and one line of numbers for the Grand Draw.

As well as the jackpot of AED10m, the Grand Draw offers prizes of AED1m for players who match four numbers and AED350 for three numbers.

As of the 90th draw on August 21, Mahzooz has paid out more than AED260m in prize money to around 185,000 winners.

A market that’s growing fast

The global lottery market is valued at $228.4bn and is forecast to grow by 9.24 percent per annum over the next four years, according to Researchandmarkets.com.

Mahzooz, which was launched as Emirates Loto in March 2020, achieved breakeven point early on, according to Samji.

“At the end of first year, we did generate profit,” he said. “There are prelaunch costs, there’s branding, there’s marketing, there’s advertising, there’s staff, there’s offices… To produce a profit and absorb this cost [in the first year] is remarkable.”

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Mahzooz players reflect the make-up of the UAE population, with Indians the biggest participants, followed by Pakistanis, Filipinos and Britons. Indian nationals have won over AED90m so far, while British players have scooped more than AED14m.

People who aren’t resident in the UAE can play via the website. They make up around 12 percent of customers each week, Samji said.

As a result, Ewings is looking to expand its operations in the MENA region and further afield.

“We’re not too far off from having similar opportunities in other markets, including Saudi Arabia and Egypt,” he said, adding that there was also interest from markets in sub-Saharan Africa and Asia.

The company is working on new concepts and products that will be launched in the next six to 12 months, he said.

“We are working with several partners. We are being approached on a weekly basis and people are saying, ‘We’d like to either franchise or we would like to do a bespoke offering.’”

Corporate social responsibility is a core component of the Mahzooz model. In the first version of Emirates Loto, players would enter the draw by buying a collectible card. These cards had images of UAE landmarks such as the Burj Khalifa on them.

Now, as well as asking players to buy water for people in need, the company supports local charities including the Dubai Centre for Special Needs, the Al Jalila Foundation, the Friends of Cancer Patients and the Rashid Centre for People of Determination.

Chasing a dream

Camelot, the company that runs the UK’s National Lottery, has reported a 3.4 percent drop in sales to £8.1 billion ($9.58 billion) for the year to March 31. The operator blamed the fall on customers tightening their belts as the cost of living rises.

The International Monetary Fund is forecasting inflation of 7.4 percent for the UK this year. Its 2022 prediction for the UAE is just 3.7 percent. As a result, Mahzooz has not suffered the same fate as the UK’s lottery, Samji said.

“It’s become a way of life for people… People have seen Mahzooz to be an avenue whereby dreams are realised,” he said. “That is one of the reasons why we actually launched this when the pandemic started.”

The trouble with winning the lottery

Mahzooz gives out more than 1,000 prizes each week, with its biggest single winner scooping AED50m in June 2020.

However, becoming an instant millionaire doesn’t guarantee happiness. According to marketing blogger Brandon Gaille, studies of lottery winners from around the world show:

• Lottery winners are twice as likely to file for bankruptcy each year as members of the general population
• More than half of winners said they were happier before they won, though nearly 60 percent said their families were happier afterwards because they were able to support them
• 44 percent of winners had spent all their winnings within five years
• 40 percent gave money to charity
• A quarter of winners bought land or a property in a foreign country
• About 3 percent of winners switched their children from public schools to private education.