Without any fanfare, the Kentucky Lottery Monday began selling tickets online to try and attract more young adults.
The initial offerings are limited to several lottery games, including Powerball, Mega Millions, Kentucky Cash Ball, and five instant games.
Kentucky is the fourth state to sell lottery tickets on the Internet, joining Georgia, Illinois, and Michigan. Minnesota tried it for a while before the state's legislature decided to ban the practice.
The Kentucky Lottery has worked with both the Kentucky Council on Problem Gambling and the National Council on Problem Gambling to limit potential harm to players. Lottery officials said they have set what they view as conservative limits on online play — $200 daily, $500 a week and $1,000 a month.
Lottery spokesman Chip Polston said that "our customers are aging." He said that about 25 percent of Kentucky residents between 18 to 35 have purchased at least one lottery ticket in the last year.
Although U.S. Internet lottery ticket sales have been limited, such tickets have been sold in European countries online for years, with a large portion of those sales going to the 18- to 35-year-old sector.
To sustain lottery revenue, "we need to attract the younger" audience, which tends to be mobile and has extensive access to technology and personal devices, Polston said.
To help boost a flagging state treasury, the lottery board of directors in spring 2013 directed the staff to pursue two new sources of revenue - Keno and online ticket sales.
Keno sales began in November 2013, but it has taken three years to develop the complex online ticketing system, including the mechanism to set up accounts and security considerations. The lottery has been working with the longtime Kentucky Lottery vendor, IGT, formerly GTech, to develop the system, Polston said.
"It was a big undertaking to make it (online sales) happen," Polston said.
"To maintain our business, we need to be more attractive to a younger demographic who are accustomed to conducting a majority of their retail purchases online," Arch Gleason, president and CEO of the Kentucky Lottery, said in a release.
Gleason said the move to Internet sales should not be interpreted as competition to the Kentucky Lottery's 3,200 retailers.
"Brick and mortar retailers are and will continue to be the most important part of our business," he said.
Polston said the lottery doesn't believe the online sales will reduce sales at the outlets across the state.
To help retailers, the online system allows players to fund their online account for play at stores that sell lottery tickets. Retailers will receive their standard 5 percent commission for the sale of those products.
For at least the first six months, players who add funds to their accounts by purchasing at least $20 in account funding on a single transaction at retailers will receive an extra $5 in "bonus bucks" in their online account.
The Kentucky Lottery forecasts that online sales in the new fiscal year beginning July 1 will total about $7 million. Overall lottery sales, in comparison, for the current fiscal year ending June 30 are projected to be $994 million.
How to play online
Before tickets can be purchased online, players also must set up an account and disclose the last four numbers of their Social Security number and their date of birth. A security vendor will check databases to make sure the players are who they claim to be. The person can then put money into the account by purchases through a retailer, or online with a credit card.
Money can be withdrawn from the account to play, but deposits left in an account cannot be returned to a player because of money-laundering laws. Winnings can be added to the account or withdrawn.
Mentions Chip Polston, he's an LP member called ChipP2
Long time posters should remember him.
I guess you have to be a Kentucky resident to buy online?
I wish all states would adopt this rule.
That way, innocent people aren't marked as targets
just because they want to go the store every week to get tickets.
Chip said on LP a couple of years ago the KY Lottery would sell tickets Online. They are still considering offering their 5 minute Keno game Online.
Presently all the state lotteries that offer Online wagering limit it to residences and/or wagering while physically in the state. Interstate Online wagering on horse racing is still legal in the U.S., but a bi-partisan bill was purposed in the House last year to make it illegal.
It still baffles me why the powers to be want to treat us like children by pretending they know "what is us".
The New York Lottery also has an online service, not for tickets, but for subscriptions. Online sales are a great way for lotteries to raise additional revenue.
Many people forget to buy tickets, or are away on vacation, if they can conveniently buy a subscription online, they are in all draws for a year.
Lotteries also don't pay commissions to agents on online sales or winning tickets. With subscriptions, lotteries get payments in advance.
Online sales are a win-win for state lotteries!
The only way they can attract the younger audience is by giving cigarettes, beer, $200 Nike shoes and iphones as prizes.
Hey there Artist77 - this is Chip Polston in KY. Yes, you do have to be a KY resident in order to play. Also, we use a geolocation service to make sure you're within the borders of the state when playing.
Thanks for posting this Todd. Will never know if my suggestion as a news story was the reason for posting this informative article.
One fine day I'll be going to Kentucky Lottery Headquarters on Main St to get the big one. Not too far from where I work @ the PICU a few miles away--a very sad job.
I remember years ago going there to buy tickets and the security guard there said they don't sell tickets. Wish they did, Massachusetts does, not that I've ever visited their headquarters (yet).
Now I see a five dollar bonus is even more incentive to give this a try.
And yes, of course you must be a KY resident to play on line, thanks to that old antiquated 1961 federal law I keep harping on.
Jeffrey
True enough, but remember my post about Federal law prohibiting this from 1961. PERHAPS Alabama will get their own lottery, but now that the hoopla over giant jackpots is over with I won't hold my breath waiting. Same for Mississippi!!
Hi Chip
Thanks for the update.
Will 5 minute Keno be offered online?
Yes, we do. Used to be Chip P Some people here don't believe lottery officials belong to LP. Well, here's your proof.
Now, have you ever wondered why the numbers or systems that you've used successfully for a long time, and then decided to share, suddenly stop working completely within a week or two?
Guess what?
and 
and there goes your winnings... 
Hey there Jeffrey! Great to hear you work so close to our HQ here in Louisville. I'm sorry we don't sell tickets in our lobby, but (as I'm sure you well know) there are lots of retailers downtown here that carry our games. Enjoy that $5 bonus and give the website a try - we'd love to know what you think about it. And we'll look forward to your visit to our HQ someday, hopefully on the right end of a four-foot-long check with your name on it!
No plans for it at this time - thanks for asking though!
Hey there - this is Chip. Don't let anyone tell you lottery officials aren't on Lottery Post. This site is one of the best around in terms of taking the pulse of engaged players, and we absolutely want to hear what you're saying. In fact, Todd (the site's founder) came to a meeting of lottery PR folks last year to pitch everyone on the site. I've been telling my colleagues for years how Lottery Post is a great venue to gauge what players are saying. I'm a believer!
Thank you, that really brightened my day. I will give it a try, nothing ventured, nothing gained as the old saying goes. i'd love to be holding one of those four foot long checks, and you could put it on LP/FB!
I tried with two different credit cards and it would not accept either one of them. Entered each carefully twice and the site did not work. Please have your IT dept fix this!!
Thanks,
Jeffrey
Found out today that five minute Keno tickets are now sold in all the stores selling lottery tickets.
Jeffrey:
Sorry I'm just now seeing your post. Give our customer service folks a call at 877-789-4532 and hopefully they can help. According to our IT staff, credit cards can be linked - however there are requirements about being able to validate that the card being linked is owned by the account holder. Billing information must match the account holder's address. Please give them a call to see if they can help. Also - don't forget you can also buy vouchers at your local retailer to play online, and when you spend $20 we'll give you an extra $5 in credit!
It's the other way around; the Federal wire act prohibits online state lottery sales outside their state borders. There is also Federal laws prohibiting mailing lottery tickets. The LP member who talks about the Massachusetts subscriptions list Australia as residence so it's probably a different process when U.S. players purchase tickets.
If the state lotteries that are now offering Online sales could legally sell outside their borders, they would.