Pandemic Boredom Gives Iowa Lottery Scratch Ticket Sales A Record Boost

Posted By Russ Mitchell on April 6, 2021

Iowa Lottery roots go back to 1985, but the folks in Clive haven’t seen a year like this one.

A global virus hurt retail sales, but canceled events and social distancing likely were boosted by a statewide case of cabin fever, according to Mary Neubauer, the vice president for external relations at the lottery.

Scratch ticket customers are on pace to set a record when the fiscal year closes on June 30.

Neubauer and Iowa Lottery CEO Matthew Strawn shared the latest information with Iowa Lottery Board on March 30.

Through February, Strawn told the board that Iowa Lottery customers bought more than $200 million in scratch tickets. The growth seen across all price points, and the total represents a 22.5% year-over-year increase to date in scratch ticket sales.

Neubauer added:

“I think I can speak accurately for us when when I say, in some ways, this was this was unexpected, because when the COVID-19 emergency hit here in Iowa back in March of 2020. In the initial weeks and couple months, lottery sales fell. I think the pandemic was just such a shock for everyone.”

Iowa Lottery customers scratched away pandemic boredom

Slumps for Powerball and Mega Millions contributed to an FY20 sales dip. Scratching, however, was a welcomed symptom for lottery proceeds in Iowa during the current fiscal year.

“As folks kept spending time at home — and, as we can all attest to, often a lot more time at home — they started looking for entertainment options to keep themselves entertained. You’ve seen (news) coverage with board game sales through the roof and puzzles through the roof. The latest I’ve seen, I think, is now houseplant sales are through the roof.

“And part of the safe entertainment options that they brought into their world were more lottery tickets — and largely lottery scratch tickets. So scratch ticket sales have set a record every year here in Iowa since Fiscal Year 2015. And that is definitely happening again this year.

“Lottery sales and proceeds to state causes are both well above budget and well above last year sales. So it’s it’s been an interesting year — and that’s an understatement.”

Audited figures through February 2021 suggests total lottery sales for the current fiscal year are $292.8 million, which Strawn said is:

  • 24.68% ahead of budgeted sales
  • 24.57% ahead of last year’s actual sales

The Iowa Lottery will raise an estimated $69.2 million for the state, according to Strawn. The CEO told board members the projections are:

  • 24.79% ahead of last year’s pace
  • 43.55% ahead of budgeted projections

January jackpots jolt sales

The Iowa Lottery was only two months into FY21 when the Mega Millions jackpot began to build. And build. And build.

The numbers aligned for a Michigan lottery club on Jan. 22, and its members claimed their $1.05 billion jackpot last month.

Two days before the Michigan win, Powerball’s $731.1 million jackpot was won in Lonaconing, MD. It was the fourth-largest Powerball jackpot of all time.

Strawn told the Iowa Lottery Board that Powerball sales are up 19.49% over last year, while Mega Millions sales are up over 50%.

Neubauer said:

“That was a huge lift for that category, but long term, there just remain challenges for the lotto category. And it’s something that not only the Iowa Lottery is talking about and working on, but other lotteries around the country also are working together, just to try to figure out what the long term strategy is going to be for games like Powerball and Mega Millions.”

Will Powerball and Mega Millions see changes?

Slow sales became “a bit of a self-fulfilling prophecy for several months” because the jackpots were low and had stayed low. Over time, the lottos finally reached what Neubauer called critical mass. Jackpots and sales started growing at the end of calendar year 2020.

It was a huge lift for Iowa Lottery administrators, but concerning trends remain:

“I think the pandemic has complicated the scenario for those products even further. There’s been some jackpot lag. … That category was really lagging until December when both Powerball and Mega Millions jackpots finally made it up into the stratosphere.”

Neubauer said stats and the major lotto operators may make adjustments to the games’ “matrix” — or game design — to boost sales. One option is more frequent drawings.

“There are many different concepts that are being discussed and I don’t think that any any specific idea has been hit upon yet. Obviously, if you’re going to make a change, you want to make sure that it’s the right one. But there are numerous different scenarios in play, because it’s about player interest and making sure that you’re offering something new and exciting.”

Iowa Lottery looks past the pandemic

Iowa Lottery budgeted conservatively for Fiscal Year 2021, knowing the pandemic impacted consumer habits in Iowa. Now, Neubauer said the state is almost at the opposite end of the spectrum.

“We do not anticipate that this is going to be a long-term trend, however. More folks are getting the vaccine, more folks are getting back to ‘their their normal lives,’ more businesses are fully opening. We anticipate that, long term, the lottery will return to modest growth but and not stay on the same pace that we are currently on.”

She said Iowa Lottery employees around the state will be going back to normal lives soon as well.

“We still are maintaining prize claims by appointment at our offices. Before COVID-19 hit, folks could just come in whenever they wanted to claim their prizes. We continue to ask folks to do that by appointment at this time. We’re just trying to limit folks’ exposure to each other, and allow us to make it through, hopefully, what is the end of this pandemic safely.

“Our sales representatives are back in stores full time. It’s been several months since that had been the case. We were running adjusted schedules there. But overall, these figures ultimately will be good for Iowa. This is going to mean a lot more proceeds going to the vital state causes that help us all.

“So we’re really proud of that and see that as something good that has come out of a really challenging year.

Russ Mitchell Avatar
Written by
Russ Mitchell

Russ Mitchell has been covering news and sports in northwest Iowa since 1997, including 11 years as managing editor for one of the most acclaimed community newspapers in the state. He looks forward to keeping readers up to date on the growing sportsbook industry in Iowa.

View all posts by Russ Mitchell