Lottery Business Practices
Despite their status as a public agency, state lotteries join casinos in using the most predatory business practices in America.
- Lotteries collect 80 percent of its profits from the financial losses of 10 percent of its users. Researchers Charles Clotfelter and Philip Cook reported to the National Gambling Impact Study Commission that the top 5% of players accounted for 54 % of total sales.
- State governments pay millions to probe the thoughts and habits of potential lottery players,analyzing what they buy at convenience stores, whether they rent videos, go to theme parks, even how they feel about owning things and belonging to a group. This fact also proves that government is actually working overtime to create new gamblers, directly contradicting the lottery’s claim that “citizens are already gambling.” These studies also show the lottery relies on the poorest and least educated.
- Lotteries seek to “reach people who have never played,” by proposing to sell tickets in more places, including online, in restaurants and in Walmart, and offering more intense games.
- The games are designed to override people’s common sense, especially people who don’t believe they have control over their lives. According to Anthony Miyazaki of Florida International University in Miami who has spent more than a decade researching lottery players: “If you feel control is on the outside, then you’re more likely to trust your life to fate or something else.”
- Lotteries are exempt from truth-in-advertising laws.
- The advertising content and practices of state lotteries target specific groups or economic classes of people. It’s racial-profiling, Lottery-style. The Illinois Lottery, for example, has a $1.6 million contract with an outside firm to market the lottery to African-Americans and another $1.6 million contract with a firm to market to Hispanics.
- State lotteries spend large sums to game creators and researchers to monitor players’ responses to new games and advertising. In states like Florida, for about $2.4 million a year, global market researcher Ipsos Reid regularly surveys thousands of Floridians. The researchers ask hundreds of questions about the lottery games people play — where, why and how much they spend on each one. They ask about the messages they perceive from lottery ads. And they ask about their attitudes toward life, fate and gambling. The consultant breaks out the answers by gender, race, age, income and education, devoting special attention to Hispanics, and then sorts people into six categories based on their lottery spending and attitudes. In addition to the Thrill Seeking Dreamers, there are Upscale Gamers, Conflicted Players, Indifferent Jackpot Dabblers, Concerned Followers and Prohibitionists.
- Those in the category ”Thrill Seeking Dreamers” are the lifeblood of the lottery. They make up 15 percent of the adult population, but they account for 50 percent of the lottery’s revenue. Most of them are women. Their income and education tend to be low or moderately low, though most have full-time jobs, and they “live for the moment,” said a 2006 Ipsos Reid marketing study.
Texas Lottery 2010 Study Shows the Lottery Squeezing More Money Out of a Smaller Amount of People
This 2010 Texas Lottery Commission report finds that the percentage of Texans using the state’s lottery has plunged to one-third, the lowest level ever measured. The decline in fiscal 2010 — from 41.7 percent of residents to 33.8 percent — represents the second-largest year-to-year decrease since the Texas Lottery started in 1993. Yet despite this massive drop, the total amount of money spent on Texas Lottery tickets has held steady, which means a smaller amount of people are spending a lot more on tickets.It explains why Texas sells a $50 scratch ticket.
Texas Lottery Demographics Report 2010
Try the “Get Rich Lottery Simulator”
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New York’s Latest Way of Enticing its Citizens to Lose Money
The latest ad campaign for the New York Lottery consists of the slogan: “Be Ready.” According the New York Times article below, the message of the campaign is that “anyone who plays the instant games…ought to be prepared to win immediately in a moment of instant gratification.”
It Only Takes an Instant, Lottery Ads Declare