Finding a sustainable solution for the fate of lottery peddlers in a changing market

The lottery market in Vietnam has witnessed a whirlwind of changes in recent years, starting with the introduction of computerized lotteries and resulting in the uncertain fate of traditional lottery peddlers. To understand the role of peddlers in the lottery distribution, this paper focuses on examining key determinants of lottery purchase intention, including gambling tendencies, sympathetic altruism, and perceived behavioral control. The findings serve as an instrument to validate the contribution of lottery peddlers and to predict their future in the industry, from which appropriate recommendations are put forward regarding the sustainable development of the lottery industry as well as the long-term solution for the fate of lottery peddlers.

FINDING A SUSTAINABLE SOLUTION FOR THE FATE OF LOTTERY PEDDLERS IN A CHANGING MARKET

Ngan T H Nguyen

nthngan.0912@gmail.com

Viet D Trinh

viet.trinh@gmail.com School of Business, International University - Vietnam

National University - Ho Chi Minh City

Abstract

The lottery market in Vietnam has witnessed a whirlwind of changes in recent years, starting with the introduction of computerized lotteries and resulting in the uncertain fate of traditional lottery peddlers To understand the role of peddlers in the lottery distribution, this paper focuses on examining key determinants of lottery purchase intention, including gambling tendencies, sympathetic altruism, and perceived behavioral control The findings serve as an instrument to validate the contribution of lottery peddlers and to predict their future in the industry, from which appropriate recommendations are put forward regarding the sustainable development of the lottery industry as well as the long-term solution for the fate of lottery peddlers

Keywords: Lottery, Computerized lottery, Peddlers, Gambling, Altruism,

Sustainable development

1 Iintroduction

Research background

Traditionally, all lottery companies in Vietnam operate in the same non-digital way: players would buy tickets that have random numbers printed on, out of which the host company would then draw the winning number Prior to the entrance of computerized lotteries, traditional lotteries used to dominate the Vietnamese market

Since its introduction of self-selection jackpot lotteries in 2015 to the Vietnamese market, Vietlott has caused a great disruption in the industry Unlike the traditional lotteries, the self-selected games allow the players to choose their own set of numbers and have these numbers printed onto their tickets immediately Moreover, the prizes of these jackpot games are much higher: while traditional lotteries offer the highest price at

2 billion VND, the special prize of Power 6/55 starts at 30 billion VND and accumulates throughout the drawings, often amounting to 300 billion Furthermore, to assist players in staying updated and well-informed about the games, Vietlott launches an official mobile app, in which all the game instructions, trial games, news, and drawing results are available with one tap

Rationally, gamblers are easily incentivized to switch to computerized jackpots, since the potential rewards are so much greater while the ticket price is only 10,000 VND, just the same as that of traditional lotteries

Since the introduction of self-selected lotteries, traditional lottery companies constantly reported slowdown, claiming computerized lotteries have taken away their shares For example, in Ho Chi Minh City, the region accounting for a mammoth share of total revenue of Vietlott, the Lottery Company for the Construction of Ho Chi Minh City reported the lowest profit in 5 years in 2017 Another example is the Lottery Company for the Construction of Tien Giang Province, whose earnings before tax drops so sharply that it had

to adjust 2017 target growth rate to only 0.02% (vnexpress.net) Meanwhile, the year-on-year growth rates in revenue of Vietlott in the same period was 237.5% (danviet.vn)

Amid the whirlwind of changes in the industry and the redistribution of the lottery market, surprisingly, little focus has been made on the peddlers although they are collectively a unique attribute of the lottery industry in Vietnam Easily found on every street and in every alley, at least 1,300 peddlers currently operate in Ho Chi Minh city (bnews.vn) Every day, they would travel approximately from 20 to 30km, striving to sell out at least 100 tickets to earn 100,000 - 120,000 per day, making a total of only 3,000,000

- 3,600,000 VND per month Peddlers are typically the disabled, the elderly and young children, thus, they have little capabilities to perform any kind of jobs other than travelling and asking passers-by to buy some luck from the tickets

Now they are even more vulnerable than ever, since traditional lotteries are vastly endangered, facing tough competition from the computerized jackpots Peddlers cannot benefit from computerized lotteries either because the involvement of peddlers in reselling the computerized lotteries thus far is deemed illegal by the local authorities To switch to opening a stationary vendor to distribute computerized lotteries is also highly improbable:

a minimum investment of 95 million VND and a fixed place, as required by Vietlott, are completely out of reach for most peddlers

The prospects of these peddlers, therefore, is dependent on their role in the lottery industry: whether the purchase of lottery tickets is encouraged by the presence of the peddlers in any way, or they are virtually dispensable in the distributing system To answer these questions, this paper studies what make(s) people want to purchase lotteries

The research aims to answer these following questions:

(1) What factors influence lottery purchase intention among lottery buyers in Vietnam? (2) Of the confirmed determinants, which one(s) have the greatest effect?

(3) How do the peddlers affect the lottery distribution system in Ho Chi Minh city?

2 Literature review

2.1 Previous studies on lotteries

2.1.1 Lotteries as a commodity

Lotteries purchasing is as much a consumption as an investment (Gerchak & Gupta, 1987) As a consuming good, the demand for lotteries is determined by economic factors

(such as prices, income levels of buyers) and demographic factors (age, gender, education level, occupation) (Clotfelter and Cook, 1990) Regarding these factors, there are some universally proven correlations between certain demographic features and the frequency of lottery purchase For instance, many studies pointed out that lower socio-economic classes would participate more frequently in lottery play (Rogers, 1998; Brown, Kaldenberg & Browne, 1992; P Thong & L Huy, 2013) Seeking explanations for this phenomenon, Walker (1992) suggested that it may be due to their poor understanding of the low odds they are engaging with, while Brenner (1986) and Herring & Bledsoe (1994) discovered that frequent players saw lotteries as an escape from poverty

As an investment, lotteries are considered risky financial assets which offer a chance of a great economic reward (Clotfelter & Cook, 1990) Even with the poor chance

of winning, people still participate in lotteries simply because the reward is much greater than the amount invested Among the determinants of lottery expenditures studied by P Thong & L Huy (2013), the ―hope to win‖ variable is found to have a great effect: the greater hope a player had, the more money they would spend on lotteries

2.1.2 Lotteries to promote the public good and help others

In addition to a commodity, lotteries are also perceived as a way to promote public services and support the government‘s earning However, this factor, according to most studies in other countries, is not a primary reason why people purchase lottery (Clotfelter

& Cook, 1990; Miyazaki, Langenderfer & Sprott, 1999)

However, the study on lotteries expenditures by P Thong and L Huy (2013) suggested the opposite Accordingly, people with a higher sense of altruism were likely to spend more heavily on constructive lotteries This is supported by the strong correlation between the variable ―Helping the peddlers‖ and the actual expenditures of Can Tho residents

This gap of understanding might have to do with the peddlers - a unique force in the lottery industry of Vietnam As P Thong and Huy (2013) suggested, the advantage of the peddlers is twofold: their mobility greatly enhances the convenience to the lottery customers; while their presence triggers altruistic motivation, thus, compelling passers-by

to buy lotteries

2.1.3 Factors of lottery purchase intention

With respect to all of the studies above, the factors that motivate people in Vietnam

to purchase lotteries can be generalized as three main sources: (1) people buy lotteries for gambling purpose in hope of economic gains, (2) people buy lotteries out of empathy for the peddlers, and (3) people buy lotteries because the presence of the peddlers make it easy

to do so This paper aims to investigate these factors in their relations with the buying intention, rather than the actual purchasing behavior

2.2 Lottery purchase intention

One of the most well-known and heavily studied consumer theories in predicting consumer buying intention is Theory of Planned Behavior (TPB) (Ajzen, 1985, 1991)

TPB maintains that the behavior of a customer is determined by his or her behavioral

intention to perform that act The determinants of this intention are the attitude and the subjective norms (Fishbein & Ajzen, 1975), and perceived behavioral control (Ajxen,

1985, 1991), as illustrated in Figure 1 In this model, while the attitude and the perceived

behavioral control reflect the consumer‘s personal beliefs, the latter is under influence of

social normative beliefs (Hansen et al., 2004) - rather than his or her own Therefore, the outcome is a result of both internal and external factors

Figure 2: Theory of Planned Behavior

The model has proven to have strong capabilities of explaining and predicting customer buying intention in many studies across multiple industries, such as online grocery buying intention (Hansen et al., 2004), intentions to purchase organic food (Arvola

et al., 2008), condom use (Albarracín et al., 2001), and lottery play in Canada (Walker, Courneya & Deng, 2017) Such results lay a solid foundation for following propositions

Firstly, the attitude towards purchasing will predict the purchase intention Secondly, to clarify what leads to this attitude, it is necessary to determine behavioral

beliefs of a person‘s evaluation of lottery purchase action In this research, gambling and empathy towards peddlers are expected to function that attitude towards lotteries purchasing Hence, it is hypothesized that:

H1: Attitude towards lottery purchase behavior positively relates to lottery purchase intention

Thirdly, the perceived behavioral control towards lottery purchase will predict the

purchase intention Perceived behavior control over lottery purchase, defined as the ease to

perform that behavior (self-efficacy) and the possible obstacles along the way (controllability) (Ajzen, 2002; Hansen et al., 2004), is expected to correlate with the

presence with the peddlers This discussion gives:

H2: Perceived behavior control towards lottery purchase positively relates to lottery purchase intention

Attitude

Perceived Behavioral Control

Subjective Norms

Behavioral Intention

Behavioral

Beliefs

Control Beliefs

Normative

2.3 Gambling tendencies

Lottery play is associated with gambling in most studies Rogers (1998), Griffiths and Wood (1999), and Ariyabuddhiphongs (2011) all regarded lottery play as ―lottery gambling‖ Clearly, there is a close relationship between lottery play and gambling

Gambling is often defined as an act of risking (or wagering) money or valuables on the outcome of a game, a contest, or any other event in the hope of winning additional money or material goods (Meyer, Hayer & Griffiths, 2009) It is characterized by beliefs

an individual upholds about the results coming from gambling (Cummings & Corney, 1987) Essentially, such reviews on the concept of gambling matched with the description

of behavioral beliefs in the TPB model by Ajzen (1985, 1991) Thus:

H3: Gambling positively relates to the attitude towards lottery purchase

2.4 Sympathetic altruism

As discussed, the study of P Thong and L Huy (2013) on lotteries expenditures discovered that ―helping the peddlers‖ factor played an important role in determining a person‘s spending on lotteries Since the vast majority of the peddlers are children, the elderly and the disabled, who look shabby and unkempt, it can be deduced that their presence has triggered some emotional response from the buyer either sympathy or empathy and compelled them to take action by purchasing the lotteries In other words, the feeling of sympathy/empathy results in altruism This aligns with the study results by Eisenberg et al., (1989), Batson (1987) and many others, in which the sense of sympathy/empathy was positively related to altruistic behavior Since altruism is the belief

in or the practice of disinterested and selfless concern for the well-being of others, this must be among the factors that drive one‘s behavioral beliefs, matching well with the description of the TPB Therefore:

H4: Sympathetic altruism positively relates to the attitude towards lottery purchase

Figure 3 Proposed conceptual framework

H2

H1

Perceived Behavioral Control

Lottery purchase intention

Attitude towards purchasing lotteries Gambling

Sympathetic altruism

H3

H4

3 Methodology

3.1 Data collection

Aiming to examine the determinants of lottery purchase intention in Vietnam, this study gathers data from 248 observes via a standardized questionnaire To yield the most representative sample, the target respondents are Ho Chi Minh City residents of all backgrounds, who have purchased lottery previously Moreover, the survey is conducted offline via convenience sampling method Finally, only those of 18 years of age or above with complete mental functionalities are valid respondents, since they are legitimately responsible for their behaviors The process of data collection is completed within two weeks to minimize the effect of other uncontrollable variations

3.2 Variable measurements

The questionnaire consists of two parts:

 Demographic information: This part concerns some background information of the respondents to determine whether they are suitable subjects, who can provide a valid answer as a lottery purchaser Furthermore, the information given in this part also demonstrate some demographic characteristics of the respondents

 Survey questionnaire: The scale consists of 23 measurement items of five

factors, using 5-point Likert scale: Lottery purchase intention (4-item scale adapted from

Lu, 2014), Attitude towards purchasing lotteries (5-item scaled adapted from George, 2004), Perceived behavioral control (5-item scale adapted from George, 2004, Hansen et al., 2004), Gambling (6-item scale adapted from Rosseau et al., 2002), and Sympathetic

altruism (4-item scale adapted from Davis, 1980)

4 Data analysis

4.1 Descriptive analysis

Table 1 illustrates the consumption trends in terms of lottery types and channels of

distribution The figures indicate two things Firstly, traditional lotteries still remain popular

in Ho Chi Minh city, accounting for 79% Secondly, the peddlers do have significant contributions to the distribution of lotteries as 51% of the respondents purchased lotteries from them However, the participation of peddlers only reflected heavily in the purchase of tradition lotteries (77%), as opposed to little impact on computerized lotteries (21%), indicating the role of the peddlers is only active in the traditional types

Table 1 Types of lottery and Channels of distribution

Distr Channel

Types of Lottery

4.2 Statistical analysis

The data analysis procedure includes reliability test, exploratory factor analysis (EFA), confirmatory factor analysis (CFA), and structural equation modelling (SEM) Internal consistency of the data is confirmed by reliability test with all Cronbach‘s alpha value above 0.7, indicating that the items are well-designed and correlate to one another (George and Mallery, 2003) The EFA, on the other hand, confirmed the independence of

the variables from one another as shown in Table 2

Table 2 Factor loading

variables

Factor loading

Cronbach Alpha

GAM2 GAM3 GAM4 GAM5 GAM6

.759 .732 .765 .696 .707 .742

.854

SYM2 SYM3 SYM4

.821 .817 .835 .856

.869

PBC2 PBC3 PBC4 PBC5

.780 .855 .835 .647 .833

.862

Attitude towards purchasing

lotteries

ATT1 ATT2 ATT3 ATT4 ATT5

.753 .662 .754 .733 .730

.613

INT2 INT3 INT4

.842 .797 .817 .757

.726

After the reliability test and the EFA, the CFA was performed to examine the fit between the proposed theoretical framework and the data set according to indicators of

goodness-of-fit Table 3 summarizes the values of model fit measurements as proposed by

Joreskog (1969), Bentler and Bonett (1980), McIver and Carmines (1981), Chin and Todd

(1995), MacCallum et al (1996); Wheaton et al (1997); Hair et al (1998), and Tabachnick and Fidell (2007) Overall, the values indicated good model fit for the research

Table 3 Model fit measurements

Finally, SEM was used to validate the relationships in the proposed framework As

the path estimates indicated, three out of four hypotheses were supported (see Table 4)

Attitude towards purchasing lotteries was found to have a positive influence on the intention to purchase lotteries

Table 4 Hypotheses testing results

H1 Attitude towards lottery purchase behavior

H2 Perceived behavior control towards lottery

purchase positively relates to lottery purchase

intention

supported

H3 Gambling positively relates to the attitude

H4 Sympathetic altruism positively relates to

Additionally, both gambling and sympathetic altruism helped shaping the positive attitude towards lottery purchase, however, gambling stood out as the more critical determinant Meanwhile, no clear effect from perceived behavioral control on the attitude was detected

As statistical analyses revealed, the total effect equation of the two exogenous latent variables (GAMBLING and SYMPATHETICALTRUISM) towards endogenous latent variable (INTENTION) through the mediator (ATTITUDE) was:

PURCHASEINTENTION = (0.074 * GAMBLING) + (0.059 *

SYMPATHETICALTRUISM) 4.3 Group variable evaluation

The sample represented all groups of age, occupation, and income level However, the sig from Levene‘s Test of Equality of Error Variances was 204 (greater than 05), indicating no significant difference in variance between group variables (age, occupation,

personal income) The tests of between-subjects effects also suggested that there were no integrated effects between occupations, age, and personal income levels towards purchase intention It is also indicated that there was no effect of group variables towards purchase

intention (Table 5)

Table 5 Tests of between-subjects effects

Mean

Partial Eta Square

Occupation *

Occupation * Age *

5 Discussions and conclusions

This research proposed three factors as determinants of lottery purchase intention: gambling, sympathetic altruism, and perceived behavioral control Statistical analyses of a sample of 248 respondents revealed that gambling and sympathetic altruism can predict the purchase intention of lotteries It was found that there was no difference among demographic groups

The study also confirmed the relationship between the attitude towards lottery purchase and the purchase intention, as Theory of Planned Behavior has put forward However, the variance was only a little higher than average, implying that there might be other factors apart from attitude

Gambling was found to have an influence on the attitude of the lottery player This revelation correlates to the previous findings of gambling and lottery play

Moreover, the study confirmed the positive effects of sympathetic altruism on the attitude of customers, aligning with the suggestions made by P Thong & L Huy (2013) This relationship, however, has not been addressed anywhere else in the world, as the peddlers are collectively a unique feature of Vietnam

As the descriptive analysis pointed out, a large proportion of lottery purchases are attributable to the presence of peddlers in the case of traditional lotteries but not of computerized lotteries With the gambling‘s effect being more significant than that of sympathetic altruism, the rise of Vietlott may tilt the interests of lottery players more heavily to gambling motivation, thus, putting the well-being of the peddlers at risks

Perceived behavioral control was found to have no influence on the intention of buying lotteries, which is inconsistent with the Theory of Planned Behavior A possible explanation could lie in the way how people perceive their ability to control the behavior:

A good part of PBC deals with how conveniently and readily the lotteries are for customers

to purchase, and the current distribution of lotteries are not convenient enough, the PBC virtually has no impact on their purchase intention Perhaps when the lotteries are officially open for sales through online channels, thus, giving customers more control over the purchases, the effects of PBC will apply

From a social standpoint, this research produced some insightful understanding of how the lucrative lottery business has been affecting people‘s lives Firstly, it revealed that

a large number of lottery purchases were made out of sympathetic altruism In other words, the role of the peddlers in the lottery distribution is affirmative, in which they have solid contributions to the business while trying to make their ends meet Secondly, gambling, too, is a popular motivation of lottery purchase, and it is more so than altruism is This raises a question of whether gambling tendencies will eventually overwhelm the effects of altruism, as Vietlott is escalating the games and offering bigger and bigger rewards If it does, it will take down thousands of the poor, the incapable of labor

Although Vietlott can hardly be blamed for the potential unemployment of those peddlers, it is its corporate social responsibility to counterbalance the impacts it has made while conducting business As a financially successful and socially responsible firm, Vietlott possesses the power to make a difference One possible short-term solution is to have a charitable fund or make a donation to the peddlers Regarding the long-term scenario, it would be best to create jobs for the peddlers, such as offering them an allowance to open small trade businesses, or sell handicraft products, or educate some to become tour-guides These jobs require similar skills to selling lotteries selling and presentation and little direct labor efforts, which can be executed by the peddlers The last solution might take initial investments in terms of organizing and educating, but its returns is two-fold: not only does it solve the peddlers‘ unemployment issues in the long run, but it can also raise Vietlott‘s profile as a cause-centric business, staying true to what

it has been positioning ―Chance to better‖ bettering the lives of the players, and bettering the lives of the peddlers

However, due to resource limitations, this paper can only provide such suggestions regarding the peddlers‘ potential unemployment issue, thus, encouraging further research

to validate these solutions and explore other options