Published: June 21, 2020

Teresa Immel, Senior Director Sales & Marketing, Schafer Systems

Teresa Immel, Senior Director Sales & Marketing, Schafer Systems

Lottery industry vendors have seen an immediate impact as a result of COVID-19, through lost sales requiring furloughs, pay cuts, etc.  The industry as a whole will be impacted long term as the pressure to deliver more revenue to the state will mount as tax receipts are down.  This will create opportunities for lotteries and their vendor partners to expand offerings, look for new ways to sell (iLottery, vending, in-lane, etc), and reevaluate current retail service models. 

Many consumers have taken advantage of shopping online with delivery or curbside pickup.  We anticipate this method of shopping will continue and possibly expand as people become more accustomed to staying at home.  Fuel stations will remain critical as people begin to emerge from isolation; therefore, finding ways to make our products highly visible and easily accessible at those locations will be critical to increase lottery sales. A primary challenge we’ll face with this newer model of shopping is how, as an industry, we can ensure our lottery products, which are often impulse purchases, remain available, relevant, and easy to purchase.

Brick-and-mortar retailers, our partners in this industry, will be looking for opportunities to ensure not only their employees remain healthy, but their finances remain healthy as well.  We need to continue to service these accounts in the best ways possible, which may look somewhat different than it did before. We may need to adapt some of the ways we operate; from how we deliver product, to retail set up, even means of payment may be different.

It’s hard to determine the long-term impact of the coronavirus.  As a vendor to the lottery industry, we felt the impact immediately with slowing orders and the inability for products to be shipped and/or installed at retail, due to state lottery warehouse closures resulting in their inability to accept shipments.  We’ve had to take serious measures to ensure the long-term health of our business.  But as the world starts to open back up, it’s logical to anticipate increasing pressure for lotteries to produce revenue as funding through taxes will have been dramatically reduced.  This may provide opportunities for lotteries to expand their offerings in a variety of ways. 

Travel will likely remain slow for a while as we have embraced “virtual” meetings through various platforms.  Although this format is sometimes challenging, it allows business to continue to operate and ensures we continue to engage with clients.  Our country has always had a large amount of freedom and we will be highly social again, it may just be in a different way, where contact isn’t as abundant. There is a feeling of increased pressure for lottery revenue which will allow the lotteries to potentially expand gaming options and distribution methods. How this will look for each lottery will be different, but it does allow for some potential growth through innovation.  Once the states are back open and running there will be a large push for them to deliver games and related products quickly to regain lost revenues.  Innovation is always a large part of growth but in these times, it will play a more significant role

There isn’t a clear answer here to what those specific challenges and obstacles are going to be, but it is clear, as a vendor that there will be a need to deliver innovative, solution-driven products to help restore revenue quickly.      

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