ILottery sales in Pennsylvania hit the $1 billion mark just before its second anniversary. The milestone represents the most commercially successful iLottery launch in North America. PA iLottery sales easily surpassed any previous iLottery launch in history.
As a result of Pennsylvania’s gambling expansion bill in 2017, the PA iLottery debuted in late May 2018. Today, the Pennsylvania Lottery has the highest performing combined retail and digital instant lottery program in North America.
Other notable figures from current weeks compared to pre-coronavirus weeks for the PA iLottery include:
- 80% jump in iLottery revenues
- 200% increase in first-time players
- $4.2 million online/mobile sales set a single-day record
- $3 million per day, average iLottery sales
The Pennsylvania iLottery program is powered by Scientific Games‘ Open Gaming System (OGS). In a press release, Scientific Games says the PA iLottery is on track to reach $1 billion in sales annually.
iLottery convenient for PA residents
Of the 46 US lotteries, 13 permit lottery games to be purchased online. However, only seven states, including Pennsylvania, offer e-instant games.
The PA iLottery features these popular games:
- Powerball
- Mega Millions
- Pennsylvania Keystone Cash
- Potion Payout
- James Bond 007
- Pennsylvania Payout
Drew Svitko, the executive director of the Pennsylvania Lottery, commented:
“Our goal in offering our players the option for online/mobile play in May 2018 was simply to meet players where they are, which is online, and it has been exceptionally well-received. During this unprecedented time, we are reminding lottery players that they have the option to take advantage of playing PA Lottery online games at pailottery.com. This is the only place where PA Lottery players can buy their Powerball and Mega Millions tickets without having to leave their homes. This is also another way people can support older Pennsylvanians during this challenging time.”
The only thing more synonymous to a Pennsylvania Lottery commercial than Gus the Groundhog is their tagline, “benefits older Pennsylvanians.”
PA lottery proceeds benefit older residents
The PA iLottery program helps protect funding for state programs. The PA Lottery is the only state lottery where all the proceeds go to older residents.
In the last year, the Pennsylvania Lottery generated more than $1 billion in PA Lottery benefits for various programs such as:
- Senior centers and meals
- Low-cost prescription assistance
- Free and reduced-fare transportation
- Care services
- Property tax and rent rebates
In an April interview with PlayPennsylvania, Pennsylvania Lottery Press Secretary Ewa Dworakowski said:
“These life-sustaining programs that seniors depend on will be needed more than ever once the pandemic is over.”
Scientific Games
OpenPlatform, Scientific Games’ content aggregation platform, provides a full suite of player account management and an affiliate program for PA Lottery’s retailers. The lottery currently has partnerships with 500 of its 9,800 retailers through the affiliate program.
During the iLottery’s first fiscal year, PA’s traditional lottery sales at brick-and-mortar retailers increased 7.2% over the previous fiscal year. Sales of scratch-offs jumped 5.9%.
Scientific Games introduced the first secure retail instant game to the world in 1974. The first digital instant game in the United States was courtesy of Scientific Games in 2014.
Scientific Games is the longtime systems technology and retail instant game provider of the Pennsylvania Lottery. Also, SG provides PA Lottery with:
- Retail and digital game portfolio management
- Consumer research
- Player acquisition and retention programs
- An omni-channel iLottery platform
- Marketing
COVID-19 hits the lottery
Even the lottery isn’t immune to the coronavirus. It forced the closure of about 30% of the 9,800 Pennsylvania Lottery retailers across the state. Traditional game sales dropped 25% since the closures of nonessential businesses in mid-March.
Pennsylvania is only one of six states with an online lottery. It’s served as a valuable asset for the PA Lottery and a safe choice for players. Online lottery play increased by 30% in March compared to earlier weeks.
Pat McHugh, the group chief executive of the lottery for Scientific Games, said:
“What’s encouraging to states looking to launch online/mobile lottery sales is that when the COVID crisis happened, Pennsylvania had a partnership and program in place to protect vital funding, including effective management of the combined retail and digital game portfolio, an iLottery platform and services to attract and retain players, integrated to support retailers while continuing the strategic management of traditional lottery products sold in stores.
“Many states will look to Pennsylvania’s program to modernize lottery products online and at retail,” said McHugh. “Pennsylvania has effectively managed high-performing retail and digital instant games creating benefits for players, retailers and the Commonwealth’s programs supporting older Pennsylvanians.”
Virtual conference talks iLottery
At last week’s ICE North America Digital online conference, the “Taking Lotteries Online & The Imperative of Omni-Channel” panel explored how the iLottery continues to evolve and how many states view iLottery as a game-changer. But it’s not without a bit of controversy.
“In Pennsylvania, iLottery is somewhat at odds with the gaming industry. The gaming industry views the iLottery as a threat to iGaming,” said David Isaacson, vice president of Spectrum Gaming Capital.
Gordon Medenica, the director of Maryland Lottery and Gaming, said the opposition to online lotteries is primarily political and the biggest resistance comes from retail partners.
“Of course, retail is very important to the lottery and there is nothing we want to do to alienate our retailers. It’s been a bit of a balancing act for us.”
He noted that in Europe, the data shows iLottery does not hurt brick-and-mortar sales. Examples in the US demonstrate the same. The demographics of lottery players are almost always the same as the state’s demographics.
Medenica, who managed lotteries in New York and New Jersey before Maryland said:
“It is a myth that lottery players are low-income. There are very few products that have the mainstream appeal as the lottery…and it relates to how we advertise and market because we aren’t targeting players since it is such a massive field.”
Payout levels of iLottery products
Medenica said typical lottery draw games pay out 50%. Paper instant tickets pay out 60-80%.
“Lotteries have found with e-instant tickets, you almost need to push the payout to casino-typical payout levels, perhaps 90%. It’s at that point the controversy erupts. Perhaps legal structures haven’t caught up to the dynamics of the game. The jurisdictions that have had success with internet based products – like Pennsylvania and Michigan – that generate double-digit percentages of their revenue have done so through the e-instants in a high-payout product.”
