Massachusetts state Senator Jen Flanagan is urging that the Bay State legislature study expanding the lottery online in order to attract more millennials, who play the scratchers less than other demographic groups.
She wrote last week: “Young people have the lowest participation rates, and these continue to decline. Simply put, millennials don’t play the lottery.” She told the Boston Globe, “We have a responsibility to look at every possible source of new revenue, and this is one of them.”
Currently the Bay State’s lottery is considered the nation’s most successful, with $5 billion sold last year. Per capita sales average $740, which compares to the national average of $230.
But it might not stay that way if the millennials don’t start to ante up.
The senator attributes this disinterest by that cohort to the lack of an online lottery and points out that members of that generation do everything online and on their mobile platforms. She has sponsored Senate Bill 2351, which would allow the lottery to do what its Lottery Commission and the state treasurer have been urging for some time now, to allow anyone to buy lottery tickets for Megabucks and other games without having to step into a brick and mortar establishment such as a convenience store or gas station.
Her bill has passed muster by the Legislature’s Joint Committee on Consumer Protection, and was referred to the Senate Ways and Means Committee.
The Lottery Commission stands ready to implement the bill. Last year it put out a request for proposal for “digital versions of existing and new lottery games, including but not limited to social gaming and daily fantasy sports options.” It received responses from 20 companies, including IGT, Intralot, and Star Fantasy Leagues.
Recently Lottery Executive Director Michael Sweeney warned lawmakers that without the bill that the lottery would “quickly end up in the scrap heap of history.” He added, “simply put, millennials don’t play the lottery.”
State Treasurer Deb Goldberg told the Boston Globe, “The only way to reach the younger market is via online lottery games. It’s the future and we need to face it.”
Critics of the online option point out that the lottery, without being online, has grown by $250 million in the last four years.
The Massachusetts Council on Compulsive Gambling argues that college students are more vulnerable to problem gambling than other age groups by about 10 percent. This is especially true of student athletes, says the Council, citing several peer-reviewed studies.
Keith Whyte, executive director of the National Council on Problem Gambling in Washington, D.C. commented last week, “We think there are definite risk factors, like the speed of play, 24-hour access, the use of credit cards, and social isolation.” She added, “The advent of online lottery games means you can go home when you’re done at the casino and continue gambling all night long.”
Lottery officials are studying methods that would allow compulsive gamblers to self-limit their purchases after they reach a certain level. Players wouldn’t be allowed to raise those limits until after a cooling off period elapses.
The Bay State government has a direct stake in keeping lottery revenues up, and so do its cities and towns who last year divided $945 million among them.
If Massachusetts does adopt the bill it will join about a half dozen states that offer the games online. Two years ago Michigan joined that group. Since it made the games available 350,000 people have registered to play. The online games increased lottery revenues by $60 million. Contrary to worries of brick and mortar retailers that their own revenues would fall, commissions paid to them are at record levels.
Joanne Mendes, executive director of the New England Convenience Store and Energy Marketers Association, is not convinced. She told the Boston Globe, “Online lottery games would mean a tremendous loss of business for our members. We need foot traffic to survive and thrive.”
Goldberg supports linking the sales of gift cards that could be purchased at physical vendors and link them to online games, including the use of free play. Another would require that winnings be claimed in person at a lottery retailer, bringing more patrons into the store.
“It used to be lottery tickets sold themselves,” said the state treasurer. “Now we will go out and market them.”
