Lottery Sales Drop as the Novelty Wears Off

Ticket sales for the California Lottery have dropped steadily as the novelty of its so-called “instant games” has worn off, lottery officials said Friday.

But, they added, the decline was expected and overall sales remain higher than predicted, and the California Lottery still ranks as the most successful public lottery in the world. Sales in the first six months of the lottery were $1.4 billion--the amount originally predicted for the first full year.

Lottery Director Mark Michalko, conceding that the sales decline is expected to continue through the summer and into the fall, said the state is counterattacking with “second-chance” drawings that will give losers another shot at big prizes.

Looking at figures made available this week, Michalko noted that, as in other states, the instant games introduced here last Oct. 3 got off to a booming start, with sales in the first 10 days totaling $128 million.

As in other states, sales declined gradually during the first five weeks, rebounding during the sixth with the introduction of a new instant game. This cycle has been repeated with the introduction of each new game every five to six weeks, but each time, sales during the rebound and subsequent decline have tended to be a little lower than before.

Interest Rekindled

Michalko said that during the first few months, player interest was rekindled somewhat when each each new game featured a prize structure offering a higher maximum payoff. While the top grand prize in Game 1 was $2 million, it climbed to $3 million in Game 2 and to progressive prizes thereafter that reached $6.38 million during Game 4.

But the instant-game-prize structure will remain pretty much the same from now on, and that means that the top instant-game payoffs probably won’t rise much, either.

“The tough part is coming up now,” Michalko said.

With the introduction of computerized multimillion-dollar “lotto” games still months away, the California Lottery people are basically stuck with marketing the same product for a while, so they’ve come up with a gimmick.

The gimmick is the second-chance drawings, which Michalko says will begin “in another four weeks or so,” when Game 6 is scheduled to begin.

Some losers will get a second chance to win by mailing in selected non-winning tickets.

“Each week there’ll be a drawing (from among the non-winners),” Michalko said. “Forty-nine tickets drawn will win $2,500 apiece. The 50th will get on the Big Spin show for a chance to win $3 million and up.”

Lotto ‘Complicated’

Then, in the fall, the California Lottery will introduce computerized lotto games--legal versions of the illicit “numbers games” that have flourished on the streets for years. As in other states, lotto is expected to be even more successful than the instant games.

But Michalko said that when lotto begins here--probably in September--it probably won’t do too well for a while.

With instant games, all the player has to do is scratch a film off a ticket to see if he has a winner. With lotto, the player has to select his own combination of numbers, wait for them to be punched into a machine, collect a receipt and wait for a drawing to see if he has a winner.

“Lotto’s complicated,” Michalko said. “People will have to learn how it’s played. . . . Eventually, it will be our best game. But it won’t start out with a bang.”

So Michalko’s still hedging his bets--still predicting, despite sales of $1.4 billion in the first six months, that sales for the first year will be “only” in the $2-billion range.

No other state has ever sold more than $1.3 billion worth of lottery tickets in a year.