Scientific Games’ SCiQ Systems Help Lotteries Find New Scratch Revenue

Marketing and analytics are important aspects of any business.

In the lottery industry, Scientific Games has worked to make that process easier for its retailers.

The SCiQ ecosystem has been expanding into multiple lotteries around the US since 2018.

These machines help take a lot of the marketing work and extra labor out of the retailers’ hands.

While operating for just scratch and instant games, and not lottery draw games for now, SCiQ is a tool many states hope can keep scratch sales growing in the years ahead.

What is SCiQ from Scientific Games?

The SCiQ ecosystems were introduced by Scientific Games even before the COVID-19 pandemic. However, they have seen a growth in value in the years post-pandemic for their labor-friendly abilities.

SCiQ is a dispensing lottery vendor that also keeps track of sales trends and data.

As stores make sales on retail tickets, the games are dispensed for the retailer. While that takes place, SCiQ tracks every unit of product sold in real time.

It allows for accurate and easy data that retailers won’t have to spend time doing themselves. The machines also provide easy inventory alerts when games are running low. That gives retailers the ability to stay ahead when it comes to restocking. It also saves time to avoid checking inventory frequently.

Since first introducing SCiQ, Scientific Games expanded the product to self-service lottery terminals called “PlayCentral, Powered by SCiQ.

These machines offer the same services and insights while allowing customers to purchase the tickets on their own without a face-to-face interaction.

Michael Martin, VP of Retail Solutions for Scientific Games, told La Fleur’s that SCiQ takes a lot of the workload and pressure off retailers:

“From the retailer’s perspective, the lottery category is challenging. On one hand, scratch game tickets generate foot traffic and, as analytics have proven, higher overall basket value in stores. On the other hand, shift reporting, shrink and inventory control for the products can be time-consuming and difficult for store managers.”

Currently, 13 different states are utilizing SCiQ.

Martin told La Fleur’s that his company was able to identify nearly $200 million in additional revenue that could be captured by proactive sales representatives and retailers over a one-year period.

Texas Lottery jumps on board with SCiQ

In the summer of 2023, the Texas Lottery developed a partnership with Scientific Games for SCiQ.

The machines began rolling out at select stores such as Circle K, Global Partners-Timewise, and YesWay, as well as some independent operators.

The products allowed retailers to be more engaged in the lottery process. They can now manage out-of-stock games more effectively and stay on top of what the market research says about the best game options for their territory.

Because of that, retailers have been more receptive to taking on higher price points, like $50 and $100 tickets. That’s something United Express Business Manager Tandy Arrant told La Fleurs:

“We were very excited to incorporate SCiQ into our everyday business. With all the stiff competition in the C-store arena these days, we felt this new system would be a point of differentiation that would draw guests to our stores.

“Not only has it accomplished that, but it has also given United Express a very detailed look at our accounting processes for scratch game tickets down to a single ticket sale. We did not have this insight before. We were able to expand our ticket selection in most locations and our sales have improved substantially. We are very pleased with the results.”

In fiscal year 2023, scratch tickets produced $6.7 billion in sales for Texas. Through 38 weeks of FY24, Texas was reporting $4.8 billion in scratch sales. That is 2.2% behind last year’s pace. However, sales are up for $30, $50, and $100 price points.

In addition to Texas, the Illinois Lottery placed a SCiQ system in about 10% of its retailers during FY24. Early sales results showed 3-6% growth over non-SCiQ locations.

Illinois plans on furthering the system expansion in FY25, moving up to about 33% of retail spots.

 

Photo by Charles Rex Arbogast / AP

About the Author

Drew Ellis

Drew Ellis

Lead Writer
A member of Catena Media since 2020, Drew Ellis is the Lead Writer at PlayiLottery, where he handles coverage of the online and retail lottery industry in the US. He previously spearheaded news content at PlayMichigan, where he covered one of the most prominent online lottery industries in the US — among the many other aspects of Michigan's sprawling iGaming market. You can email him at [email protected].
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