State Lotteries Nationwide in a Slump

So-called ‘jackpot fatigue’ and lack of interest from younger generation lead to slowing sales.

May 27, 2015

TRENTON, N.J. — States throughout the country are facing lower sales of lottery tickets, thanks in part to jackpot fatigue, meaning that states need increasingly bigger jackpots to lure in casual players who buy lottery tickets only when a prize is huge.

People once impressed with a $100 million payout shrug until it reaches $300 million. But with fewer people playing, it takes longer to get to those sky-high jackpots, placing state lotteries in an increasingly downward cycle.

An article in USA Today cites New Jersey as an example, as the state saw sales of Mega Millions and Powerball multistate games down 30% through the end of March. At that pace, says USA Today, sales of those games — which make up about 15% of all lottery sales in the state — would drop by $130 million this fiscal year. And New Jersey is not alone.

Total lottery sales in 18 states and the District of Columbia decreased in fiscal 2014 compared with fiscal 2013, according to the North American Association of State and Provincial Lotteries, a trade group that represents 52 lotteries across the United States and Canada. Texas led the pack with more than 15% decline in sales.  Lower sales also mean fewer funds going into state coffers.

At the same time, New Jersey is banking on sales of in-state games, such as scratch-off tickets (which are up 10%), the new CASH4LIFE game that New Jersey and New York launched that expanded this spring to Pennsylvania and Virginia, and plans for a new instant draw game to launch in August. However, that may not be enough to convince a new generation of lottery players.

"There's a generation that went to the local convenience store, picked up their newspaper, picked up their cup of coffee and picked up their lottery tickets and went off to work," N.J. State Sen. Paul Sarlo told the news source: "The younger generations don't do that anymore.”

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