Year-end tally: retailers earn $119 million from lottery
by Acting Commissioner Jim Kipp

Michigan Lottery ticket sales approached $1.69 billion in fiscal year 2002, roughly 4 percent ahead of last year. Lottery retailers continue to play an integral role in the Lottery’s success, earning more than $119 million in commissions this past fiscal year.

Retailers weren’t the only ones who benefited from strong Lottery sales. According to unaudited figures, lucky Lottery players took home $918 million in prizes this past year. But the proudest accomplishment for the Lottery concerns another very important group of people in Michigan: public school children.

Although the final numbers aren’t in, I am pleased to announce the Lottery’s annual contribution to the state School Aid Fund is expected to be over $605 million—a more than 3 percent increase over last year.

Much of the ticket-sale increases the Lottery has seen this past year are due to the phenomenal success of Mega Millions (formerly The Big Game), the Daily 3 and 4 games, and instant tickets. On April 16, The Big Game jackpot reached a whopping $331 million—just short of the all-time North American jackpot record of $363 million.

The excitement generated by that jackpot alone boosted Big Game ticket sales all across the state. While the lucky winner of that jackpot wasn’t from Michigan, 12 Michigan Lottery players won $150,000 Big Game prizes in the April 16 drawing.

The giant jackpot wasn’t the only big news for The Big Game in FY 2002. On May 17, the New York and Ohio lotteries joined the Big Game group to form a new multi-state game called Mega Millions. The Mega Millions group got even larger on September 4, when Washington joined Mega Millions—bringing the grand total of participating states to 10.

The Lottery’s Daily games maintained a strong foothold in the Lottery market, this year comprising nearly 42 percent of the Lottery’s total lineup while posting a collective 3.2 percent gain over last year’s sales. The continued success of these long-running games is partially due to the debut of the new Daily 3 & 4 EXTRA on May 16.

This game allows Daily 3 & 4 players to spend an extra dollar for a chance to win $500 instantly at the Lottery terminal. This new game brought in an additional $12.7 million in sales for the Daily 3 & 4 games in FY 2002.

Instant game tickets continue to be a rapidly growing segment of the Lottery’s lineup. With 62 instant ticket games introduced this past year, Lottery players have seen the resurgence of some old favorites, as well as some extremely popular new games.

In May the Lottery introduced its first-ever double-sided instant game ticket called “Double Feature.” This ticket offered a $500,000 top prize and was a popular new concept with players. Additionally, the Lottery offered a couple of different promotions attached to the instant games in FY 2002.

In February the Lottery distributed coupons that offered players one free $2 instant game ticket with the purchase of a $5 instant game ticket. The promotion was so popular the Lottery brought it back in April and September.

The Lottery also teamed up with McDonald’s restaurants to offer customers a coupon for a free $1 Michigan Lottery instant ticket or $1 off any higher-priced instant ticket with the purchase of a Bacon Ranch Crispy Chicken Sandwich Extra Value Meal. This promotion was also very popular with Lottery players statewide.

In FY 2002 a National Association of Convenience Store (NACS) study conducted by Ernst and Young further supports the position that Lottery products are an integral part of each and every retailer’s product line. The study showed that Lottery is the second-highest product sales category, which clearly demonstrates the value of Lottery products to your business as a whole.

With that in mind, as the Lottery begins to look ahead to fiscal year 2003, we are focused on keeping our game lineup fresh and exciting for your customers. With the introduction of the new Change Play game in October and the upcoming changes we expect to make to the Michigan Millions game in early 2003, your customers will have even more reasons to visit your stores to purchase Lottery products.

Low Sales Fees
According to the Michigan Administrative Code, the Lottery is authorized to assess low sales fees. During the 2002 calendar year, the Lottery will monitor the sales activity of all online Lottery retailers to evaluate the cost-effectiveness of the terminal installation and to assure that Lottery resources are allocated to generate the maximum revenue for the state School Aid Fund.

A minimum of $1,000 weekly total Lottery sales average (online plus instant games) throughout the year is needed to avoid a low sales fee assessment at the end of December 2002. When you initially receive a terminal, the first 13 weeks of operation with the terminal are exempt from the low sales fee.

‘Tis the Season
They’re back . . . those ever-popular holiday-themed instant game tickets. As you know, instant tickets make great stocking stuffers, and by offering an appealing array of these games, you will be able to maximize your commissions.

This year’s holiday lineup includes six games to choose from. “Wintertime Wishes,” the Lottery’s newest $10 instant game offering a top prize of $500,000, will hit ticket counters on November 7.

The $2 “Stocking Stuffer” boasts a top prize of $25,000 and will be available on November 14 for your players to stuff in all of their friends’ and family members’ stockings. Also on November 14, players will look forward to taking a shot at winning the $5,000 top prize on the $1 “Reindeer Games” instant ticket.

Winning cash will be sweeter than ever when the new $5 game, “Candy Cane Cash,” also debuts at ticket counters on November 14 offering a $250,000 top prize.

On November 21, even though the snow will likely be flying, your customers will be seeing green—green dollar bills that is—with the new $1 “Seeing Green” instant game, which offers a $5,000 top prize.

Finally, on November 27, those cold winter days will seem much warmer when your customers try their luck at winning the $15,000 top prize in the $2 “Winner Weather” instant game.

This attractive lineup will definitely put your customers in good cheer. I encourage you to prominently display the colorful point-of-sale materials the Lottery has provided for promoting the instant games this holiday season. Be sure to ask for the sale and remind your Lottery players that instant games make the perfect gift year-round.

The Lottery will also be airing a heavy schedule of radio and television advertisements that will surely bring holiday shoppers into your stores. Those advertisements will begin airing on November 28 and run through December 24.

Return to November Michigan Retailer Page one • MRA home