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Online Lottery Sales Target Web Generation

Illinois aims for 1 million new players with online Lotto and Mega Millions play.

by / March 23, 2012

Nearly 13 million residents of Illinois will have a new way to play the lottery starting Sunday, March 25. Hoping to capitalize on the coveted 18- to 34-year-old demographic, the state has taken two of its popular games — Lotto and Mega Millions — online.

The state is hopeful that the online option will cater to customers who have a Web-first buying mentality. “The Illinois Lottery seeks to broaden its existing player base and appeal to modern consumer buying habits,” explained Michael Jones, Illinois Lottery superintendent, in an email to Government Technology.  “Many non- and infrequent players would be apt to purchase lottery products if they were offered on the Internet,” Jones added, referencing extensive research the state conducted in advance of the online launch.  

The Illinois General Assembly has approved a multiyear pilot program for online lottery play. The program was made possible by a 2011 decision by the U.S. Department of Justice (DOJ), which softened certain restrictions on online gaming. A December 2011 New York Times article discussed the DOJ decision and its potential as a revenue generator for states.

Indeed, Illinois officials expect to gain between 600,000 and 1 million new lottery users because of the new online capability. And those new users could represent a significant new revenue stream — estimates hover near $100 million in new sales for Illinois. The lottery’s website indicates that 30 percent of lottery sales — $690 million in fiscal 2011 — fund K-12 education and other designated projects. The majority of lottery earnings, 59 percent, are paid out to lottery winners.

The lottery’s website requires players to register with a valid Social Security number, and prove their in-state residency. A multivendor software system draws on the best practices of many European countries that have several years of experience in Web-based lottery sales.

Image: The Illinois Lottery is debuting its new website for online gaming on Sunday, March. 25.

In Finland, Italy and the UK, the introduction of online lottery play actually increased lottery sales in retail locations too. “Examples from European models with similar game offerings and retailer trade styles prove that overall sales and commissions increase when an Internet channel is launched,” Jones explained.

Illinois expects a similar retail boost from a larger player base. Some games, including instant scratch-off tickets, will continue to be offered exclusively in brick-and-mortar stores.

Critics express concern that state-sanctioned lottery sales equate to public support for online gambling, a serious addiction affecting millions in the U.S. Officials argue, however, that they can more easily monitor lottery customers online than patrons buying tickets at physical locations. In Illinois, each person will be limited to $100 per day in online lottery purchases.


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Noelle Knell Editor

Government Technology editor Noelle Knell has more than 15 years of writing and editing experience, covering public projects, transportation, business and technology. A California native, she has worked in both state and local government, and is a graduate of the University of California, Davis, with majors in political science and American history. She can be reached via email and on Twitter.

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