Published: April 23, 2020

May Scheve Reardon, Executive Director, Missouri Lottery

How will the world be different when we come out of this crisis - and how will the lottery industry, retailing, consumer shopping and recreational behavior be different?
Consumer “confidence” will be slow to recover from the COVID-19 pandemic. Even when states attempt to reopen and relax social distancing, many consumers will lack the “confidence” to resume their previous patterns of travel, recreation and purchase. Complicating this timeline is the threat of a reoccurrence later this fall as the weather changes and with the possibility of additional cycles in the future.

Until there is a significant drop in positive cases and deaths, successful treatments, a vaccine and sufficient time has passed, many consumers will still limit trips to retail and use other distribution channels such as the internet, BOPIS (buy online and pick up in store) and courier for many items.
Many in public health have said for years that it is not “if,” but “when” a pandemic is going to happen. We have just experienced the severity of such an event and many have called for a more national approach to more successfully manage these kinds of crises vs. leaving it up to individual states that all respond differently. That is not an easy task given our country’s comfort and history with “states rights” in handling things like emergency responses.
During the COVID-19 Crisis, NASPL gathered insights from many Lotteries on how they were responding to the crisis including: how are you handling retailer billing, new ticket launches and ticket returns; how are you paying prizes over $600; are your offices open; have your drawing procedures changed; how are you social distancing and protecting your sales force in the field?
Many states managed things differently, and maybe that will never change.  One thing is certain, what one of us does in the Lottery industry impacts all of us from an integrity standpoint. This could be an opportunity for NASPL and member lotteries to look back at what worked and what didn’t, and develop a national response (best practices) for future events like COVID-19. COVID-19 forced NASPL to cancel its professional development seminar scheduled for July in Denver and the World Lottery Summit 2020 in Vancouver, BC, in October. Lottery industry conferences are essential to sharing best practices and continuing education credits for Lottery employees in certain disciplines. This pandemic event has forced many schools and organizations to conduct classes and training using video streaming. This might be a good opportunity for NASPL to consider the possibility of organizing and streaming educational opportunities as teleconferences in the future.

What might lottery operators be doing to position ourselves for success in the post-corona virus world?
The COVID-19 Pandemic has created havoc on state budgets. Lotteries are key contributors to those budgets. Lotteries are a natural for seamless omni-channel distribution. More states will consider adding the digital channel to preserve and grow profits for their good causes.  During the COVID-19 crisis, many other brands stepped up efforts to distribute their products using BOPIS (buy at home and pick up in store) and  home delivery. Look for Lotteries to follow this lead, as it will be part of the new normal.

Lottery has performed better than other sectors in past economic recessions.  How severely will the economic repercussions of corona virus impact Lottery?
Lotteries have traditionally weathered economic recessions because our games provide affordable entertainment and hope during tough times, and that has not changed. But COVID-19 is different in that it seriously impacted the entire world and everyone in it. Most lotteries depend on their retail partners to sell their products. When large sections of their retail network such as bars, restaurants and self-service are closed by government order, it reduces access to lottery products. Lotteries who have a large number of grocery and c-store partners faired better, as those retailers were deemed “essential” and could continue to sell Lottery. Lotteries and other brands that offer consumers products through the digital channel faired even better during this event.

The  two most profitable U.S. jackpot games (Powerball and Mega Millions) usually dictate what kind of year a Lottery will have, as other games benefit from large jackpot runs. During this COVID-19 crisis, player participation dwindled to a point that both games were forced to make game changes in the middle of jackpot runs. The impact those changes will have on the games’ future is unknown for now. Both multi-state groups will need to collaborate on strategies to stabilize and jump start those game once things begin to open up.

What opportunities will emerge in the post-corona virus world?  For instance, won't people be traveling less, and if so, might that be an opportunity to appeal to locally grown forms of recreation like Lottery and casino gaming?  For instance, in spite of months of social distancing, can't we expect that humans will quickly return to our natural state as highly social animals?

Some consumers, especially those in more rural areas that were not as severely impacted by the virus, will attempt to return to normal but there will be a large portion of the population - especially in more densely populated areas - that will continue to live the new normal - practicing social distancing and limiting trips to retail and other public areas. Players still want to play, but their behavior will be modified as we recover from this crisis. Lotteries must adapt and help meet the new normal. The digital channel is an obvious solution for states that can make that happen, but there are other strategies Lotteries can implement to help players feel more comfortable with our existing products. Lottery mobile apps permit players to check their tickets and produce play slips that can be scanned at retail to avoid social contact. We can encourage draw games players to use advance play. We can encourage more retailers to accept debit and credit cards for lottery purchases, as cards are perceived to be more easily disinfected than cash.

How might we reinforce and build upon the symbiotic relationship that Lottery has always had with its retail partners?
Relationships have always been a driving force with Lottery retailers. Many lotteries have taken steps during this crisis to protect retailers’ profits including suspending billing and communication fees, offering more liberal billing terms for Scratchers ticket returns. Most lotteries depend entirely on their retail partners for product sales. Lotteries that make relationship selling a priority fare better during uncertain times like COVID-19.
Many or those “essential” retail employees made sacrifices during COVID-19 to keep important products and services available to their customers.  We all owe these employees much respect and gratitude and should make special attempts to recognize their sacrifice. The Iowa Lottery created a television spot recognizing retail clerks and emergency workers for their hard work and sacrifice during COVID-19.   
Many of our retail partners have struggled mightily to hang on during this crisis. Now, more than ever, we must collaborate with our retail partners to improve our products and processes to respond to the new normal and positively impact their bottom line.

Legislators and regulators will have a lot on their plate over the coming months.  Even so, what can we do to push harder than ever to get approval to make Lottery products available online, i.e. iLottery?  And to push for authorization to invest in new games categories, and new technologies like in-lane sales and cashless transactions? 
Many lotteries have already been moving toward diversifying how we reach players, and COVID-19 will definitely speed up that path for some. Budget shortfalls will create the perfect storm for some states who have been considering expanding Lottery in the areas of iLottery, BOPIS, In lane, Video Lottery, etc. While additional lottery revenues may be helpful, lottery will not be the most immediate or top priority for most states in the upcoming months, as there are many more pressing issues that will take precedence including passing state budgets that include dollars to help struggling businesses and citizens recover from the economic downturn.

The Pennsylvania Lottery has provided a good example for state legislators of how the internet channel can help stabilize lottery profits during crisis. Pennsylvania experienced a 30% increase in their iLottery sales during this time and a significant increase in new player registrations. Players are staying home and playing online and Powerball and Mega Millions sales increased from 2% to 10% online during this crisis. It is not enough to make up that state’s overall sales loss, but it has helped.

What are some of the new challenges and obstacles that we will need to adjust to?
Continuing to ensure our employees are safe is still goal #1 for most lotteries. We will need to make sure we have enough masks, gloves, and hand sanitizer for all who meet the public on a regular basis, and we will “stock pile” these items for future events. We will also need to invest in more laptops, as we may have more employees working remotely from home in the future. I am amazed at how resilient our team is and has come together to address this issue. We have been conducting “all employee” skype meetings to help keep our employees connected and up-to-date on COVID-19 directives and responses to our players and retailers. This practice has proven very productive and will continue on some level for the future.


Lotteries must document our responses to the various issues that developed during this crisis and make a list of the processes that worked and those that didn’t. The COVID-19 crisis was an opportunity for lotteries to put their Disaster Recovery Plans into action in real time. We will be adding the pandemic scenario to our Disaster Recovery Plan and practicing it in preparation for the next event.

Lotteries have had to be careful about pushing out marketing messages that might be perceived as proactively encouraging players to leave home to purchase Lottery during a time when everyone is under strict government orders to stay at home. Lottery broadcast advertising that includes calls to action during this pandemic continues to be risky, and some Lotteries have pulled their broadcast advertising for the immediate future.
Lotteries need to continue to be responsive and available to players. Some are continuing to place broadcast beneficiary messages, while others have converted broadcast advertising into digital advertising. We need to continue to preserve our brand by stepping up our communications directly with our players through social media and our loyalty programs. We need to continue to reinforce that the Lottery and our retail partners are doing everything possible to make Lottery products and equipment safe for players.

All Lotteries are challenged with developing COVID-19 recovery plans to get their employees back to work and drive players back to retailers. As many leaders have said, it will not be like turning on a light switch. There is new information every day that will help set that course. Now more than ever, we need to collaborate with our vendor and retail partners to be more customer-focused in our approach to the new normal balancing social responsibility with our mission for funding good causes.