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Ohio Lottery rides record-setting sales growth

Jul 19, 2006, 12:09 pm

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Ohio Lottery

Instant tickets continue to drive the highest sales growth in the history of the Ohio Lottery.  Successful marketing and an increasing number of players have pushed sales up $55 million, a 4.6-percent increase, in 2006.

Patty Vasil, Ohio Lottery deputy director of product development, said $10 and $20 instant games, and games tied to name brand merchandise prizes, may account for the rise in instant game popularity.

"They attract a player who may not purchase lottery tickets, but likes the merchandise part of the game," Vasil said.

Merchandise games include prizes such as motorcycles and cars, in addition to cash. These games have helped fuel the lottery's record-setting sales growth from January through June. Instant games now account for 57.3 percent of lottery tickets sold, compared to approximately 51 percent three years ago.

Mardele Cohen, Ohio Lottery communications director, said a player could choose an instant ticket on something as simple as color, but merchandise tickets award prizes that consumers may not otherwise buy. She said the lottery tries to use popular products for merchandise games and for promotions in general.

The Texas Hold 'Em instant tickets represented a successful tie-in to popular culture.

"The first time we did Texas Hold 'Em, about two years ago, within a matter of a month we knew the game was flying off the shelves," Cohen said. "We re-ordered, and we order in millions. It's like any other business; we want to keep our products fresh and we want to be current. Bridge is not the big thing right now... that's why we have Texas Hold 'Em."

Individual state lotteries work with larger game manufacturers when considering marketing and sales. In Ohio, the lottery often buys from Scientific Games, a company that handles licensing with companies such as Harley Davidson, NASCAR, Ford and Chevrolet.

Vasil said the NASCAR promotion sold fewer tickets than expected to the Ohio consumer base.

Addiction risk

With increasing popularity comes a concern of increased gambling addiction, an issue the lottery addresses through its marketing and Web site.

Patricia Bellner, a dual diagnosis counselor of Substance Abuse Services Inc. in Toledo, said gambling addiction is understated.

"People have not been coming forth with this in the past," she said.

Bellner received her training through the Ohio Lottery. She focuses on cross addictions, which could occur with gambling.

"We see lottery become a big problem with people recovering from substance addiction and it becomes an issue of cross-addiction," Bellner said.

Bellner said counselors from other states have voiced envy over the funds provided to counselors by the Ohio Lottery.

"The lottery commission is aware some people are struggling with the thing they provide," she said.

Keith Whyte, executive director of the National Council on Problem Gambling, compared gambling addiction to alcoholism.

"Gamblers prefer certain types and get started on certain types, but when addicted, they might try anything," Whyte said.

Whyte said speed of play factors into gambling addiction, and instant tickets, like slot machines, offer a quick play.

Betty Scribner, 79, of Toledo, said lottery is her only vice.

"I don't smoke and I don't drink," Scribner said.

Her granddaughter, Natalie McCormack, 25, said Scribner finds any family member she can to give her a ride to buy lottery tickets at a local Pharm.

"It's the only thing I spend my money on," Scribner said.

Whyte said the Ohio Lottery has had a good reputation for dealing with gambling addiction.

"We try and work with [the lottery], there is a lot the industry has to contribute in this," he said.

Gambling awareness groups have worked with lotteries to raise awareness. The Ohio Lottery Web site links to counseling services. The Ohio site also provides problem gambling facts, stating that 3 percent of adults may have a gambling problem. Whyte said the Minnesota Lottery recently funded a marketing campaign to raise addiction awareness.

Whyte and Bellner agree the lottery is not automatically harmful, but can be for vulnerable players.

"Not everyone who plays the lottery is an addict, it's just certain people are vulnerable, and that's where I come in," Bellner said.

Whyte also identified underage gambling as a developing concern. According to a 1999 Harvard Medical School survey, 30 percent of teens under 18 reported playing the lottery in the past year. Whyte agrees with the Ohio Lottery Web site statement that the earlier someone begins gambling, the more likely a problem develops.

Whyte called it "utterly irresponsible" for instant tickets to be provided through unsupervised vending machines, which could occur in Ohio stores. Unlike the disappearance of cigarette vending machines, lottery ticket machines persist.

"It's not just, 'oh gee, these kids are gambling,' " Whyte said. "Gambling can lead to other very serious consequences."

Player input

Cathy Sharrar buys lottery tickets daily at the BS Mart on Summit Street. Sharrar spends at least $4 per day on tickets and once won $50.

"I like something that makes me think and keeps me out of trouble," she said.

Scientific Games researches popular trends before offering games to state lotteries. Cohen said, for example, Ohio chose not to sell a "King Kong" themed game from the company.

"What does that mean to us? It's just another movie," Cohen said. "For New York state, with the Empire State Building, that's a huge ticket for them. But Texas Hold 'Em, or Harley — from one end of the country to the other."

Besides the research by Scientific Games, the Ohio Lottery meets with retailers and lottery players for input. Vasil said the lottery tries to hold focus groups with players every quarter.

Sharrar keeps track of cards and complained about the readability of some new designs. She also said the lottery should supply smaller plastic pieces to scratch the tickets, as they previously did. Sharrar carries a small scratcher she has saved.

Retailers offer input on a monthly basis, and speak for thousands of players. Vasil said a lot can happen to a ticket in the four months between its proposal and sale. Retailers see upcoming games and suggest changes in graphics, price, name or color.

"This has been beneficial because it realigns our partnership with retailers," Vasil said.

A.J. Abdo, of BS Mart, recognizes popular tickets. He said most players scratch tickets before they leave the door.

He has seen a $400 winning ticket in the store.

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