The Truth Behind FOOLottery: April Fool's!
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FOOLottery!®
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By Dear Fellow Fools, The beginning of spring always delights us at Fool Headquarters.
The chill winds ease, our nation's capital is alive with cherry
blossoms, the country gears up for baseball (relatively
steroid-free, this year)... and we get to devise a Foolish
prank to loose upon the world on the first day of April. We hope you enjoyed this year's lottery stunt. Happy April
Fool's Day! As you might imagine, we at The Motley Fool believe April 1 is
our national holiday (unclaimed as it is). It's a day when
we try to fulfill our mission of educating, amusing, and enriching
you, but with a triple helping of amusement! We don't run our jokes
to embarrass people. (Well, that's certainly not the
primary aim.) Instead, we hope to teach key concepts about
personal finance, investing, and life -- wrapping the medicine of
learning in the sugary flavor of a playful hoax. The lottery, roasted Lottery ads are, sadly, targeted most aggressively at people
lacking the financial education to know how many daily tickets are
too many. Less than one-quarter of the population buys nearly
three-quarters of all the tickets. It says something that when
curbs or halts have been placed on lottery advertising, ticket
sales have dropped off dramatically. For us at The Motley Fool, an organization with a mission of
helping everyone make better financial decisions, one lottery
ticket a day is too many. Therefore, the 25 tickets that some of
our fellow citizens are buying each day is, we think, a high-order
financial catastrophe. Players get hammered by a 50% loss of
capital on every ticket, every day of the year. The net result for
99.99% of the players is mounting losses, which can demolish hopes
of a comfortable financial life. For context, here's some simple
math: A 50% payback rate will turn $20 million wagered daily in the
state lottery into fewer than two cents within 30
days. If you're interested in this subject, we highly recommend the
excellent book
Selling Hope: State Lotteries in America, by Charles
Clotfelter and Philip Cook. FOOLottery! unplugged FOOLottery! was a worldwide, multihundred-million-dollar game
organized to compete with state-run lotteries in the United States.
Rather than a 50% ratio, our members would be treated to a
110% payout ratio, on average earning them rewards on each
wager. As people went to get their online tickets, enthusiastic
about the rules of our (1) Play Now, Pay Later" program,
(2) money-back guarantee, and (3) free-ticket plan for referrals
(the "BUDDIBonus"), our opportunities for operational profit
evaporated. The threat of heavy losses for The Motley Fool began to
mount. A supposed FBI investigation ensued, followed by pointed
criticism from two semi-fictional lottery proponents -- the
Union of State Lottery Workers & Homeroom Educators, and the
State Lottery Council lobbying group. These events made our task
more difficult. But the real trouble started around 3 p.m., when
your two founders began pleading with members to stop buying
tickets. We were already down somewhere between $5 million to $25
million, so we turned to the only people who could help us.
You. We asked you to please, stop playing. You kept playing. The theory goes that you don't really test a person's integrity
until you test his or her ability to deal with failure. Our April
Fool's Day "failure" tested our mettle, and the result was evidence
of serious character flaws. We Gardner brothers jury-rigged a 4
p.m. drawing, manufacturing a controversial final ball. ("It's an
O; no, it's a zero; I don't know which!") A harsh, but fair,
journalist of our own creation at the nonexistent Washington
Gazette lit us up for running an unprofessional, unethical,
and likely illegal lottery. Then our joke concluded with no one
winning the lottery and a grainy black-and-white photo of the two
of us high-fiving each other on the way out. We -- The House -- had hornswoggled the planet, taking
home $125 million. Would anyone fall for this nonsense? As we and our production team (led here at Fool HQ by Dayana
Yochim, David Forrest, and Jeb Bishop, with great last-minute help
from humorist Todd Etter -- thanks, Fools!) put the finishing
touches on our joke in the final days of March, we gave it even
odds. We were trying to make our prank believable, yet so
preposterously flawed that it might just fool a few of
you. FOOLottery was launched at 3 a.m. on April 1, and within the
first few minutes, it looked like we might fail. We opened an email
from a veteran Fool member, who wrote simply: Are people actually falling for this? I mean, c'mon! It is April
FOOL's Day! Some of those rules and conditions are pretty
funny! Not long afterwards, this note from another member
came through: Oh, please! You guys have been playing these April Fool gags
over the last five years now. Do you honestly think that we're this
naive? What followed throughout the day, though, as the final 4 p.m.
drawing approached, warmed our hearts. The emails flooded in, 600
in all. And almost half were written by people who'd fallen for our
joke. It looked like we'd successfully played on the human tendency
to crave short-term gain and then agonize when the opportunity
dries up. For the first of many bits of evidence supporting our claims of
success, we submit this note sent to us, colorfully titled "Watch
Sesame Street for the Episode on the Letter 'O'." It
read: Dear FOOLS! And I do mean that literally, if what I just read was true. I
somehow missed everything to do with the FOOLottery except for the
news of your great stupidity. How can I ever trust you to give me
ANY advice about anything ever again? Even preschoolers know the
difference between a zero and the letter O. How you could fail
to recognize the outrageously glaring ambiguity when you were
writing on the balls and not make them different in some way is
unfathomable! Morons! At The Motley Fool, we are not practitioners of the timelessly
cruel art of schadenfreude (taking pleasure in the pain of others);
therefore, you won't read the full name of anyone who penned us a
note complaining about our FOOLottery! game. However, as far as the
messages, we do have some doozies to share, as well as notes from
members who picked up on our intent right away. They who fell for the prank What follows is a collection of actual letters we received from
people around the world. Indeed, we probably should say it once again: This was all a
joke! Let's check in with the Fools who caught us in the act of a
prank. The lessons we've learned What is gained are some great lessons, and we're not always the
ones teaching, either. For instance, what great lessons in human
nature, good and bad, were taught in the notes cited above! Below
are a few others. From us: Lesson No. 1: Lotteries suck. Lesson No. 2: We're a bunch of Fools. Lesson No. 3: The stock market gives you 10% --
there's your 110%. Lesson No. 4: OK, it's April 1, OK? Remember? Lesson No. 5: The two-thirds majority. *
* * In closing, we are quite sure we will remember for years and
years the joke of 2005, the year we created a fictional
lottery (we, a lottery?!) that: And what egg on our faces we had when we couldn't tell whether
that Ping-Pong ball we drew showed an "oh" or a zero! And we grin once again as we put the finishing touches on this
article of reflection, and that short list above, and as we think
once more on this joke, now concluded, and its effects, which
probably never will totally conclude. It is hoped that all of the above brings a smile once again to
many a Foolish face, whether fooled or not. For that is the
spirit. Fool on! The Gardners Miss our April Fool's prank? Or do you want to enjoy all our
funny Foolish pictures and prose again? Start here, with our
concluding piece on
the aftermath of FOOLottery. You can also share your
thoughts on our FOOLottery discussion
board.
This year, we trained our sights on the lottery system run
by 40 state governments. We don't mind saying that we find the
system absurd. Every day of the year, the loudest message you'll
hear from your elected state officials goes something like this:
"You can't win if you don't play."
But April 1 isn't about soapbox preaching. Our goal is to
have some fun by climbing atop apple crates and idly telling the
people of Internetville about our latest creation. This year, we
had our fun by rolling out a game we called FOOLottery! (A reminder
again, folks: Everything we're writing about in the next few
paragraphs is completely fictional!)
Fair question.
Throughout the day, we were inundated with notes from
players trying to print up their numbers and letters and an animal,
trying to claim their BUDDIBonus tickets, trying to figure out just
how Play Now, Pay Later" worked, and trying to decipher how much
they'd have to pay per ticket.
I thought your aim was to become wealthy as
you "educate, enrich, and amuse" the rest of us. What lesson are
you trying to teach us here? That "greed conquers all"? Or is it
that "gambling is good"? This whole episode conflicts with
everything else we've been learning from you -- and smacks of pure,
mercenary greed.
(This is what followed half an hour later.)
Oh, man! April Fool's? I walked right into
that one. Boy, do I feel stupid now. I guess I should look at a
calendar now and then. Good one. I take back everything I said. My
respect has now gone up. (A fickle thing, aren't I?) Well, now, I'd
better buy those newsletters right away.
Very interesting concept, but I found there to be
too little information on your website. For example, I was unable
to find out the price of the tickets. What are the methods
available to pay? How is this legal? I thought only states
were allowed to run lotteries. Is this run offshore? The
laws of what country govern this drawing? Your terms were
cute, what with reference to the "king of the lottery," but they
lack some basic info...
They who got the joke
I am a 17-year-old college-bound student who
was extremely excited, two days ago, when I heard I could
participate in your FOOLottery (being under 21, I am not otherwise
allowed to gamble). I was even more enthused when I discovered that
I would not have to purchase my tickets! An online message board
posted free vouchers available to participants who had bought in
bulk, and 20 free tickets were made available to me.
When the final balls were selected by the Fools, I waited with
bated breath. My animal-alphanumeric matched! I had the donkey on
one of my free digi-tickets. But I still didn't think I had a hope
of taking the victory. Next came the 1. I had it! Followed by P, 5,
A, and, eventually, R. I couldn't believe that I had come so far,
and on my first time playing! I was afraid to breathe -- in fact,
afraid to even move. I realized at that moment that my life could
be changed forever. Would I buy a boat? Too cliche. A house? A
mansion? A dozen mansions? My mind was racing. But my chances of
winning were still 1 in 50 (26 letters, 10 numbers and 14
animal-alphanumerics). The world slowed down around me, I heard
each beat of my heart, loud and distinct and subtle, each heave of
each ragged intake of breath racked through my entire body. And
then the last number was selected. It was mine! The prize! I had
the last zero! And then the brothers looked confused, picked it up,
and examined it. It was unclear whether it was a zero or an "oh,"
they claimed.
At first I was shocked, then angry. But now I'd like to thank the
Fool brothers. They've saved my life. With all of that money, I
wouldn't have gone to college. I'd have bought a lot of nice
things, sure, and a lot of friends, but none of it would have been
real. I'd never get a true feeling of accomplishment ever again in
my life, as it would have all been about luck.
I've refused all the class action lawyers who have called me. Don't
worry: I will emphatically NOT be pressing charges. I'd like to
thank you for giving me my life back!
A good April Fool's Day here at Fool.com should be like a
fine, flaky chocolate mousse cake: rich and many-layered. We go
all out, and we have for 12 years straight. We spend hours
dreaming the project up, put hours more into designing it, writing
it, software-coding it, laying it out on the Web, and on and on. As
you've seen above, we even lose customers as a result of
doing our joke. Some people get fooled, and outraged, and cancel
their business with us... and even though we write up and in some
cases mail out this explanation, they never actually figure out it
was a joke! Years later, some still believe we really did
try to IPO a company called eMeringue, or that we really
intended to launch a personals service called love.fool.com... yet that, too, is
part of the many layers and the richness. We put in these hours,
even lose that business, because what is gained is far more
valuable than what is lost.
Pardon our French, but that's the most obvious lesson from
our April Fool's Day joke of 2005. The impetus of this year's joke
was our long-held and extreme disdain for this wonderful
"investment," brought to you by most of the state governments
across our fair land. State lotteries are a racket, and they're
really quite an embarrassment for those who run them. They work
really hard through expensive advertising every day to entice large
numbers of ignorant and, in some cases, desperate people to fork
over some of their savings to a racket that skims 50% off the top.
That old ironic saw about how "we're from the government and we're
here to help you" comes to mind. Here to help, eh? What it comes
down to is this: Lots of us out there are having our tax burden
borne on the shoulders of some relatively destitute people ahead of
us in line at the 7-Eleven. "Gotta play to win," huh? Proud of
that?
Before you take us for imperious judges sitting in
condemnation of our fellow Americans, we hasten right away to
remind you that we are merely Fools. We are not judges. We have
opinions, of course. But we will generally make our points with
jokes. Fools have been advisors to the court for a thousand years.
They have no aspirations to power. They just offer truthful counsel
with a friendly face and are quick to make a joke, hoping to
brighten your day. Yes, we've testified before Congress numerous
times in the past on topics of interest to the individual investor.
Invite us back for the lottery -- we'd love to talk lotto! But
remember that in the end we're only testifying to the power of
Fools, and we know it.
We had a lot of fun conceiving of this lottery to end all
lotteries, one that "would give 110 percent!" As we think all our
Fools know by now, the reality is that lotteries pay only 50% back
out. It's a bear market every day for state lottery players -- a
market crash, actually. A 50% decline in the value of your
assets is horrendous, especially on a daily basis. By contrast, it
is the stock market that gives you 110%. The historical
annual return of the stock market is PLUS-10 percent, annually.
Some years it loses money, of course, so there are no annual
guarantees. But average it out over time, and there's your annual
110%. So, instead of lottery tickets, buy shares in good public
companies that give you ownership in something less fanciful than a
fleeting one-in-a-million dream. Wanna make a million? Really? Have
more slow fun (slow fun is always more fun) doing it our way.
The Motley Fool does April Fool's jokes on April Fool's
Day. Every year. Without fail. We know this lesson may be obvious,
but the reality is that if thousands of people didn't forget this
every year, our joke wouldn't work.
We've been able to look over the inflow of thousands and
thousands of customer notes reacting to our April Fool's jokes for
more than a decade now. And so we can now authoritatively say that
every year, about two-thirds of you get it, and one-third is
fooled. This is generally good news, by the way, for our
republic. No wonder we've kept this democratic-like experiment
going for 229 years. If the ratios were reversed... eeesh.
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