Coronavirus Could Push More State Lotteries Online, as Retailers Remain Closed and Revenues Tumble
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The COVID-19 pandemic is causing lottery sales across the country to plummet, as millions of Americans are being laid off and many brick-and-mortar retail lottery agents remain closed.
Lottery sales are hurting because of the coronavirus. (Image: Pat Greenhouse/The Boston Globe)
The inaugural SBC Digital Summit running this week through Friday held a lottery conversation titled “State of Play – US Lotteries During the Coronavirus.” Gordon Medenica, CEO of the Maryland Lottery and director of the Mega Millions Consortium, was one of the participants on the remote call.
We were very much focused on the casino closures, and then we found that two days after the casinos were closed the bars and restaurants were closed – and they represent about 15 percent of our retailers,” Medenica said regarding the Maryland Lottery. “We saw an immediate hit.”
Medenica says revenue declines escalated quickly. Maryland saw sales drop 20 percent in the first week of all nonessential businesses being closed, 25 percent the following week, and 30 percent in week three. “We didn’t know where the bottom was at that point,” he explained.
Lotteries Deemed Essential
Currently, only eight states allow their lotteries to offer online games. They are Georgia, Illinois, Kentucky, Michigan, New Hampshire, North Carolina, Pennsylvania, and Virginia.
With state lotteries all reporting a drop in sales and subsequent revenue, the programs they assist will suffer in terms of lost aid. No lottery has been suspended on a governor’s order, as the games are considered essential because of their charitable missions.
In the 37 other states that have a lottery, plus the District of Columbia, Puerto Rico, and US Virgin Islands, those interested in purchasing a lottery ticket must do so in person. Critics say that requirement has resulted in unnecessary social distancing failures, as lottery players flock to convenience stores to test their luck.
Medenica says the Maryland Lottery has advised retailers to force lottery players to exit the store after making their purchase. He’s also encouraged players to seek out self-service lottery machines.
“We went through a whole retailer education process that seems to be working. People are going in the stores for their essential items, and they pick up a lottery ticket,” Medenica added.
Online Solution
Another panelist in the lottery discussion was Barry Pack, CEO of the Oregon Lottery. He opined that the coronavirus should be a wake-up call for lottery officials.
All of us as lottery directors need to spend some serious time thinking about what a post-COVID 19 world will look like and how you fit into it,” Pack stated. “Think creatively about our customer journey and figure out what their expectations are going to be. We’re all going to be wearing masks for some time now, and we’re going to have to figure out what that means for lotteries moving forward.”
The coronavirus has already modified how the two most popular lottery games in the US are played. Mega Millions and Powerball have both done away with guaranteed starting jackpots and minimum jackpot increases.
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