As lotto sales dipped early in the year crafty marketing and eye on the bottom line keep projected revenue steady

05/11/2017 06:15 PM

Year-to-date lottery sales in the state dipped in February, due in part to a record-breaking $1.6 billion dollar jackpot last year. The state lottery came up $21 million short from what was budgeted for the beginning of the year, but has managed to keep budgeted revenue to the state on track.

In addition to record breaking sales the year before, scratch-off ticket sales were down by almost $16 million dollars from last year, and $22 million down from where lottery officials were estimating sales to be this year.

As Chip Polston the Vice President of Communications for the Kentucky Lottery explained sales are bouncing back — thanks in part to some crafty marketing.

March sales were $95.7 million, the second highest sales month in the Kentucky Lottery’s history. The driving force behind the sales was the lottery’s “Big Money” scratch-off ticket.

“We’ve never had a scratch off ticket this large before, and it really captured player’s imaginations,” Polston said, adding the marketing team for the lottery aggressively plugged the ticket during March madness basketball games on television.

Polston said lottery officials thought the 15 second advertisement would peak player interest, but they had no idea what was coming.

“On the Monday the ticket launched we started getting calls from retailers that players were waiting when they opened to try to get the ticket, and they were watching UPS trucks in the area who were delivering it that day to see who actually had it,” he said.

The lottery thought they had enough of the tickets for a 210 day supply, but within three days they’d sold a third of their supply — two weeks later all the tickets were sold out. Since that time the lottery has reorder more tickets, and are planning on rolling out a second large format scratch off ticket later this year.

Even though sales dropped and then rebounded, the lottery is on track to deliver an estimated $236 million dollars expected by the state. Part of the reason for that has been tracking bottom line figures like operating expenses and lower than budgeted prize payouts.

The Kentucky Lottery is turning 28 years old. The lotto began in April of 1989 after 60 percent of voters ratified the idea. A large pitch for the lottery came from former Gov. Wallace Wilkinson with the promise of funding education.

Polston said lottery revenues have not always gone straight to funding education. He credits current Governor Matt Bevin for re-directing lottery revenue from the General Fund back to education scholarship programs.

“I give a tremendous amount of credit to the Bevin administration, because actually going back several administrations there’s been ‘not withstanding’ language in that state budget every year that would pull sometimes 10 to 15 percent of our proceeds back over into the General Fund to try to fill up some gaps that were in there,” Polston said.

The lottery used to primarily funds three programs: KEES, the Kentucky Education Excellence Scholarship, and two needs-based programs — the Kentucky Tuition Grant and the CAP or College Access Program.

“Those three programs are where a lot of the dollars went for a long time,” Polston said. “Gov. Bevin with reallocating a little bit of that, and putting that new money back in has really been able to really expand the focus of those.”

The lottery is now funding everything from teacher scholarships, to providing scholarships for National Guard members and providing funding for coal severance counties, and dual credit programs in high school, Polston said.

“The umbrella has broadened tremendously under this administration.”

Polston says the impact of scholarship money provided by the Kentucky lottery reaches far beyond helping kids pay for college. He says it is helping keep Kentuckians in the state after they graduate.

More than 650,000 students across Kentucky have received a lottery-funded college scholarship or grant since Fiscal Year 1999.

Watch the full interview with Polston in the video below.


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