Atlantic Lotto spent $2M to promote axed GeoSweep game

The Atlantic Lottery Corporation spent almost $2 million to advertise and promote theGeoSweeplottery before pulling the plug on the game,documents obtained by CBC News through an access-to-information request show.

GeoSweepwas launched in Atlantic Canada last year. Its introduction to the market was accompanied by a splashy promotional campaign, including TV ads, billboards, and buses covered by the logo.

When the lottery corporation announced its decision to remove the game from the Atlantic Canada market this summer, lotteryofficials wouldn't say how much all of that cost.

"Its not our practice to release internal business cases and projections," Atlantic Lotto chief financial officer PatrickDaigletold CBC News in late June.

At the time,Daiglealso wouldnt discuss how badGeoSweepssales were in Atlantic Canada.

"Im not at liberty to disclose specific financial data,"Daiglesaid.

While those sales figures remain a mystery, the access-to-information response sheds some light on the games ad budget.

Between January 2012 and July 2013, the lottery corporationsays it paid out $1,978,256 to external suppliers to promoteGeoSweep.

Production costs came in at more than $622,000, while media charges were nearly $1.3 million.

4 provinces offered game

Atlantic Lotto steered interview requests toDaigle, who was unavailable for comment.

In an e-mailed statement, the corporation defended the spending.

The marketing expenditure forGeoSweepwas in line with what is invested in any game launch, spokeswoman CourtneyPringle-Carverwrote.

The marketing expenditure forGeoSweepwas in line with what is invested in any game launch.-Courtney

As all four provinces offered the game;the amount was divided equally among each.

Those promotional costs are in addition to the $8.7 million Atlantic Lottofunneledinto the U.K.-based firm behindGeoSweep.

The New Brunswick and Prince Edward Island governments each put up $4 million for a stake in the company Geonomics, formerly known asRoboreus. Newfoundland and Labrador and NovaScotiaopted out.

That investment is in the parent company, Atlantic Lottery Corporation has stressed,not the GeoSweep game itself.

GeoSweep is a lottery game not unlike other corporation offerings, albeit with a digitaland geographicaltwist.

Instead of picking numbers, players could go online to pick a location on a map of Atlantic Canada their house, for example, or some other place of significance to them.

There were more than 2.3 million such locations, called Geos, up for grabs in the region. The cost to own a Geo was $7.50 for 30 days, or 25 cents daily.

There was one guaranteed daily prize of $1,000, which was selected from Geos that were actually owned. Neighbouring Geos were eligible to share another $500.

A big prize of $250,000 was also up for grabs every day. That draw, however, included all Geos, whether they were occupied or not.

GeoSweep never paid out that daily $250,000 grand prize in more than a year's worth of draws in Atlantic Canada mathematically, a near-certain indicator of poor sales.

1st and only investment to date

The investment in Geonomics, the company behind the GeoSweep game, is the first and, so far, only by Atlantic Lotto, as the corporation seeks to expand its reach beyond the region.

The corproation contends that flatlining growth and increased competition are forcing it to expand into international and digital realms.

The corporation has kicked the tires on lottery opportunities from Illinois to Albania, and pushed to offer online casino gaming.

Profits from Atlantic Lotto go back to the four provincial governments in Atlantic Canada.

When expenses rise and profits fall, there is less cash sent back to those governments.