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Many states' lottery sales are rising in recession

Insider BuzzInsider Buzz: Many states' lottery sales are rising in recession

NASHVILLE, Tenn. — Even in these tough economic times, many people are feeling lucky.

More than half of all states with lotteries have reported rising sales over the past six months, and some researchers say financial insecurity might be driving people to risk more of their money than usual on $1 and $5 instant scratch-offs and other daily games in hopes of a big payoff.

"Someday somebody is going to win and I hope it is me," said Albert Atwood of Nashville, who spends $100 weekly playing the Pick 5 and Lotto Plus. "I imagine that I would be a heap better off if I saved this money, but everybody has dreams."

Driven by regulars like Atwood and a growing number of occasional players, 25 of 42 states with lotteries have experienced higher sales of scratch-off and daily lottery games since July, according to Scientific Games, a maker of scratch-offs.

  • In Washington, D.C., instant sales reached a record of $45 million in the 2008 fiscal year, representing an 11 percent year-over-year increase.
  • In Tennessee, sales of instant lottery games were up $8 million during the fiscal first quarter ending in October.
  • The Massachusetts lottery reached a record of $4.7 billion in sales during the last fiscal year, up from $4.4 billion in the previous year.

Nationwide, instant and daily lottery revenues have been on the rise since 2004, according to U.S. Census Bureau data.

States' revenues from multistate lotteries, such as Mega Millions and Powerball, have dropped. But industry officials say sales of those tickets tend to fluctuate as the value of their jackpots rise and fall. If there is no winner one week, the size of these jackpots increases the following week.

Some experts say economic hardships prompt people to justify small-stakes gambles even as they cut back on nonessential goods and services. Others pin the increased lottery activity on creative marketing by scratch-off makers and state governments, which cannot afford to lose this revenue stream at a time of extremely tight budgets.

Scientific Games CEO Lorne Weil said states are doing whatever they can to keep sales from falling. "They are consciously working with us to launch new programs, offer tickets at new price points and increase the number of retail outlets," he said.

By law, many states' lottery revenues are designated toward education, parks or recreation and cannot be put into the general fund to help meet budget shortfalls in other areas.

Two out of every five states with lotteries are experiencing falling sales, according to Scientific Games' research.

A Rockefeller Institute of Government study released in June says that revenue is at an all-time high but growth has slowed to about half of its long-term annual growth rate of 5.1 percent.

In Georgia, instant ticket sales increased by 7 percent from September to October of fiscal year 2008 but just 2 percent from September to October of fiscal year 2009.

"Scratch-offs are more addictive than other lottery games because they are inexpensive and purchased almost anywhere," said Gail Howard, author of Lottery Master Guide and New York Lottery News columnist. "People are playing because they hope to score so they can have something in their pockets."

The urge to wager on lotto does not extend to casinos with wavering gas prices and the prerequisite for vacation time contributing to a revenue decline at gambling destinations like Las Vegas.

Of course, many people do not realize that routine spending on lotteries can be just as costly as the occasional visit to a casino. "Small ticket purchases add up over time," said Emily Haisley, a postdoctoral associate at the Yale School of Management who published a research paper on lotteries in The Journal of Behavioral Decision Making in July.

The Rockefeller study found nationwide total lottery revenue has climbed steadily since 1992, rising to $17.4 billion in 2007, the most recent year for which data were available. Lottery revenue increased most rapidly over that 15-year period during the 2001 recession, according to the study.

Some researchers see a correlation between economic difficulties and the popularity of lotteries.

"When people feel like they are behind compared to where they were yesterday, they want to make up for that," Haisley said. "They become risk-seeking in order to catch up and the small hope of winning becomes more attractive."

John L. Mikesell, a professor at Indian University, published a study in 1994 illustrating lottery sales rise with unemployment rates. "When times are tough, the prospect of spending $1 on a remote chance to potentially change your life is appealing," Mikesell said.

Bill Cooper, a 60-year-old a from Chattanooga, Tenn., was still savoring his $500 win from a day earlier on a $1 Cash 3 pick that helped the disabled painter pay a groceries, a title loan, some IOUs.

Allen Nevils, a 58-year-old moving company supervisor, put himself on a budget, driving less and purchasing groceries in bulk, but he still allots $20 a week to play daily lottery games. "I really don't want to win that much," Nevils said. "I just want to be alright."

Lottery officials say creative marketing is a key factor in the rising popularity of their games.

Since 2004, New York has added 13,000 blinking, beeping video lottery terminals similar to slot machines at eight harness tracks, adding $875 million, or 13 percent annually, to sales, according to New York lottery spokesman John Charlson.

Maryland Lottery has partnered with Major League Baseball's Baltimore Orioles and the National Football League's Baltimore Ravens to promote bubble gum-scented scratch-offs, sell lottery tickets at games and give season tickets as prizes.

California's aging 30-minute lottery show is getting a $14 million makeover and changing its name to "Make Me A Millionaire," where players can win a spot on the weekly show through $1 scratch-offs.

Atwood, a 68-year-old telephone company retiree, said he has spent at least $75,000 on lottery tickets since the Tennessee lottery began selling tickets in 2004.

Playing recently at a Nashville convenience store that boasts it is home to two $1,000 scratch-off winners on neon colored advertisements, Atwood handed a winning scratch-off to a clerk. That got him a $5 scratch-off ticket and $1 discount toward another.

"I am absolutely not acting in my best economic interest," Atwood said. "But we always hope that we win big and that is what drives us."

AP

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9 comments. Last comment 6 years ago by charmed7.
Page 1 of 1
dpoly1's avatar - driver
PA
United States
Member #66141
October 16, 2008
1452 Posts
Offline
Posted: January 12, 2009, 12:57 pm - IP Logged

A lot of people are desperate right now. On December 22nd my life savings was $25.

Times are tough for a lot of us.

I usually spend $1 per play on the Powerball. My $2 a week hobby and only hobby that I spend money on.

A small wager could help someone with unfortunate circumstances.

    diamondpalace's avatar - Untitled 2.jpg
    Dallas, TX
    United States
    Member #60284
    April 12, 2008
    3856 Posts
    Offline
    Posted: January 12, 2009, 4:12 pm - IP Logged

    Spending $1 for a chance to win millions, or even some money is looking delicious right now in this economy status. There are people winning big. The winners are now able to have the funds to better their life and hopefully help out others around them. Expecting ticket sales to rise as we are approaching high school and college graduations.

      Tnplayer805's avatar - G 14_v78828750_Small.JPG
      North Dakota
      United States
      Member #13397
      April 5, 2005
      1623 Posts
      Offline
      Posted: January 13, 2009, 1:23 am - IP Logged

      Tennessee's instant ticket sales increased...  The payout percentage decreased...  Why does that not surprise me?  I'm so happy to live close to Florida now...  (Or Biloxi if I want a casino)

      How are you going to win if you don't play?

        psykomo's avatar - animal shark.jpg

        United States
        Member #4877
        May 30, 2004
        4641 Posts
        Offline
        Posted: January 13, 2009, 2:10 am - IP Logged

        A lot of people are desperate right now. On December 22nd my life savings was $25.

        Times are tough for a lot of us.

        I usually spend $1 per play on the Powerball. My $2 a week hobby and only hobby that I spend money on.

        A small wager could help someone with unfortunate circumstances.

        have no fear > o'bama will L@@K after U & me>>>>>>>>>>>>>>>>>!!!!

        I am wait'g 4 all D check's 2-B mailed OUT on 2-01-2009>>>>>>>>>>>!!!

        2 ALL D people who VOTED-4-O'BAMA>>>>>>>>>>>>>>>>>>>>>>>>!!!

        ????????????????????????DID-U-VOTE__________4-O'BAMA????????????

        TRANSLATION:

        IF U voteeeeeeeeeeedddddddddddddFOR>>>>>>>4-O'BAMA!!!!!!!!!!!!!!!!

        EXPECT>>>>>>>>>>>>>A>>>>>>>>BIG>>>>>>>4-O'BAMA>CHECK$$$

        otherwise:

        KEEP PLAY'in >>>>>>>>3-4-5-6>>>>& MB & PB & international LOTTO's!!

        ?????????????????????? "DO-U-HAVE-A-TICKET-2-D-swear-in-2009"????!!

        (SELL-IT-NOW$$$$$$$$)

        LOL

        PSYKOMO

          dpoly1's avatar - driver
          PA
          United States
          Member #66141
          October 16, 2008
          1452 Posts
          Offline
          Posted: January 13, 2009, 1:02 pm - IP Logged

          have no fear > o'bama will L@@K after U & me>>>>>>>>>>>>>>>>>!!!!

          I am wait'g 4 all D check's 2-B mailed OUT on 2-01-2009>>>>>>>>>>>!!!

          2 ALL D people who VOTED-4-O'BAMA>>>>>>>>>>>>>>>>>>>>>>>>!!!

          ????????????????????????DID-U-VOTE__________4-O'BAMA????????????

          TRANSLATION:

          IF U voteeeeeeeeeeedddddddddddddFOR>>>>>>>4-O'BAMA!!!!!!!!!!!!!!!!

          EXPECT>>>>>>>>>>>>>A>>>>>>>>BIG>>>>>>>4-O'BAMA>CHECK$$$

          otherwise:

          KEEP PLAY'in >>>>>>>>3-4-5-6>>>>& MB & PB & international LOTTO's!!

          ?????????????????????? "DO-U-HAVE-A-TICKET-2-D-swear-in-2009"????!!

          (SELL-IT-NOW$$$$$$$$)

          LOL

          PSYKOMO

          I guess that I have to wait for the Powerball.

          I am so sad.

          What?

            Avatar
            Marquette, MI
            United States
            Member #20541
            August 20, 2005
            495 Posts
            Offline
            Posted: January 14, 2009, 11:24 am - IP Logged

            I laughed when I read this.

            The "experts" dont know much except how to justify their salaries by making up reasons for why things are happening.

            I have cut back on lottery spending in 09 and I wont be playing the 6/47 here until at least mid May if not later.  Currently I don't plan on playing Mega Millions until at least mid February.
            I wont be playing the 3,4, Keno or scratchers either.  I might do fantasy 5 sometimes and I will probably do the raffles.

            Still, if Michigan changes the games I might start playing more often again.  If the 6/47 had the Florida option then I would be tempted to play every draw.

            If Mega had a second jackpot option and a 2nd and 3rd prize multiplier I would probably play almost every draw there.

              justxploring's avatar - villiarna
              Wandering Aimlessly
              United States
              Member #25360
              November 5, 2005
              4458 Posts
              Offline
              Posted: January 14, 2009, 11:39 am - IP Logged

              Allen Nevils, a 58-year-old moving company supervisor, put himself on a budget, driving less and purchasing groceries in bulk, but he still allots $20 a week to play daily lottery games. "I really don't want to win that much," Nevils said. "I just want to be alright."

               

              I know that an awful lot of posts talk about winning $100M or billion dollar jackpots, but I'm sure this sentiment represents most people.

                RJOh's avatar - chipmunk
                mid-Ohio
                United States
                Member #9
                March 24, 2001
                17948 Posts
                Offline
                Posted: January 14, 2009, 12:27 pm - IP Logged

                "Someday somebody is going to win and I hope it is me," said Albert Atwood of Nashville, who spends $100 weekly playing the Pick 5 and Lotto Plus.

                Sounds like there's still plenty of money in the market for lottery tickets which means it's there also for new and improved lottery software that have a different angle on winning. 

                * you don't need more tickets, just the right ticket * 
                * your best chance at winning a lottery jackpot is to buy a ticket * 
                     Wink 

                  charmed7's avatar - Lottery-013.jpg
                  MICHIGAN
                  United States
                  Member #65282
                  September 22, 2008
                  1867 Posts
                  Offline
                  Posted: January 18, 2009, 11:08 am - IP Logged

                  With all this people getting laid off from there jobs. And all of the other crap

                  going on in finance sector  why not.  Can't win if u don't play. Famous words

                  from "Hustle and Flow"   It's gettin haaaaaaaaard out here for a pimp" in

                  my case pimp-ette!!!