If you‘re one of the millions of Americans who enjoy playing the lottery, you might be wondering if you can pick up a Mega Millions ticket along with your weekly Target grocery haul. The answer is yes… probably. While Target does sell lottery games in the vast majority of its U.S. stores, there are a few key details and exceptions you should know about before making an extra stop at the Customer Service desk.
In this ultimate guide, we‘ll give you the complete lowdown on Target‘s lottery ticket business, from the specific games sold to the potential impact on the company‘s bottom line. We‘ll also provide expert tips and insights to help you make the most of your Target lottery purchase. Let‘s dive in!
The Basics of Lottery Tickets
First, a quick primer on lotteries for the uninitiated. A lottery is a form of gambling that involves drawing numbers at random for a prize. Players purchase tickets printed with a set of numbers. If the numbers on the ticket match some or all of the numbers drawn, the player wins a prize. The more numbers matched, the larger the prize.
In the U.S., lotteries are run by state governments. Each state decides which games to offer, the price of the tickets, and how the revenue is used. The most common state lotteries are "pick" games like pick-3 and pick-4 that pay out fixed prizes, and "draw" games like Powerball and Mega Millions that have jackpots that grow with each drawing until someone wins.
Speaking of Powerball and Mega Millions, these two multi-state games are the behemoths of the lottery world. Tickets cost $2 each and drawings are held twice a week. The jackpots start at $20 million and $40 million respectively and grow by tens of millions each time the jackpot rolls over. In recent years, both games have produced record-breaking jackpots of over $1.5 billion.
Of course, the odds of claiming one of those 10-figure checks are infinitesimal. The odds of winning the Powerball jackpot are 1 in 292.2 million. For Mega Millions, it‘s 1 in 302.6 million. To put that in perspective, you‘re about 250 times more likely to be struck by lightning than to win either jackpot. Still, millions of people play each week, hoping against all odds that their numbers will hit.
Target‘s Lottery Ticket Sales
One of the most convenient places for many people to take a chance on a lottery ticket is at their local Target store. The retail giant sells lottery games at its Customer Service desks in 44 states and the District of Columbia. Only six states are excluded:
- Alabama
- Alaska
- Hawaii
- Mississippi
- Nevada
- Utah
The reason for the exclusion is simple. Those six states do not currently operate state lotteries, so there are no lottery tickets to sell there, by Target or anyone else. Most of these states have laws on the books prohibiting lotteries. Religious objections, concerns about gambling addiction, and competition with other forms of gaming like casinos are often cited by state legislators as reasons for the bans.
But in the 44 states where Target does sell lottery tickets, you can walk right in and have access to most of the same games you‘d find at your local convenience store or gas station. Every Target location offers Mega Millions tickets, which are sold in 45 states in total. Powerball tickets are likely available at Target as well, along with state-specific draw games and instant scratch-offs.
So how much lottery action is actually happening at Target‘s Customer Service desks? It‘s hard to say for sure, as Target does not break out lottery ticket sales in its financial reports. But we can make some educated guesses based on the overall performance of state lotteries.
According to the North American Association of State and Provincial Lotteries, U.S. lottery sales totaled over $91 billion in fiscal year 2019. Powerball and Mega Millions sales combined accounted for about $7.7 billion of that haul. With around 1800 Target stores selling tickets in lottery states, even a tiny sliver of those sales could mean big bucks for the bullseye.
Let‘s also consider a key metric for retailers: commissions and incentives. In most states, retailers earn a base commission of 5-6% on each lottery ticket sold. So on a $2 Mega Millions ticket, Target is likely pocketing around 10 to 12 cents. That may not sound like much, but it can quickly add up given the high volume of tickets sold during big jackpot runs.
Plus, in some states, retailers can earn bonus commissions for selling jackpot-winning tickets. These incentives can range from a few thousand dollars to a cool million. In January 2021, a Kroger store in Michigan earned a $50,000 bonus commission for selling a $1 billion Mega Millions jackpot winner. Talk about a nice boost to the bottom line!
Of course, those big retailer payouts only happen when lightning strikes. In the 18 years since Mega Millions began, only 15 jackpot-winning tickets have been sold at retail locations. The odds of it happening at any given Target store are slim. But still, the potential is there, and it adds an extra element of excitement to the customer experience.
The Strategy Behind the Sales
So why does Target bother with lottery tickets at all? After all, the revenue from ticket sales is probably just a drop in the bucket compared to the company‘s overall sales, which topped $78 billion in 2020. Surely the hassle of dealing with lottery regulations and gambling-addicted customers isn‘t worth it for such a small piece of the pie, right?
Not so fast. While lottery tickets may not be a major money-maker for Target, they do serve a few important purposes in the company‘s retail strategy. First and foremost, having lottery tickets available adds to Target‘s reputation as a one-stop shop for all your household needs. If customers know they can grab a Powerball ticket while they‘re picking up diapers and dog food, they may be more likely to choose Target over a competitor that doesn‘t offer that convenience.
"Lottery tickets are an impulse purchase," says c-store industry consultant Casey McKenzie. "And impulse purchases are the bread and butter of retail. If a customer is already in the store buying necessities, and they see that big jackpot sign at the service desk, they might just decide to toss in a ticket or two. Those little add-on purchases can really add up."
McKenzie also notes that lottery ticket buyers often fall into a desirable demographic for retailers. "Studies have shown that the average lottery player is a middle-aged, middle-income individual," he says. "That‘s the sweet spot for a store like Target. Lottery tickets can be a way to get those shoppers in the door and keep them coming back."
Target may also be using lottery tickets as a way to drive traffic to its service desks, which have become increasingly important in the era of online shopping. With more and more customers buying their everyday essentials with just a few clicks, brick-and-mortar stores need to give shoppers a reason to come in and interact with employees. Lottery tickets provide an opportunity for that face-to-face interaction and a chance to upsell customers on other services like gift card purchases or Target Circle account sign-ups.
Finally, selling lottery tickets allows Target to project an image of being a fun, lucky place to shop. Retail is as much about emotion as it is about utility. By aligning itself with the thrill and excitement of the lottery, Target can create a more positive, engaging shopping experience that keeps customers coming back even if they never hit the jackpot.
Scratching the Surface
Of course, not everything about the lottery retail business is as shiny as a freshly minted quarter. Retailers like Target do have to jump through some hoops to offer lottery tickets to their customers. Each state has its own set of regulations and licensing requirements for lottery retailers, which can create a lot of red tape and compliance headaches.
For example, in California, retailers must pay a $100 application fee and undergo a criminal background check to obtain a lottery license. In Florida, retailers must be approved by the state‘s Division of Alcoholic Beverages and Tobacco and may have to post a bond of up to $10,000. And in Texas, retailers must have a dedicated lottery terminal and separate bank account for lottery transactions.
On top of the regulatory hurdles, there are also some potential drawbacks to selling lottery tickets that retailers like Target have to weigh. One concern is that the presence of lottery games might attract problem gamblers who tie up service desk lines and create a negative atmosphere for other shoppers. Retailers must walk a fine line between encouraging responsible play and not coming across as predatory or enabling harmful behavior.
To that end, Target does have some safeguards in place. Employees are trained to spot signs of problem gambling and provide resources for help. Stores also post warnings about the odds of winning and the potential risks of excessive gambling. And of course, all lottery ticket sales are age-restricted, with ID checks required for anyone who looks under 30.
Another potential issue is the impact of big jackpot winners on store operations. When a retailer sells a winning ticket, especially for a monster jackpot, it can create a major disruption. Media attention, increased foot traffic from curious onlookers, and even security concerns can all come into play. For a high-volume retailer like Target, even a small disturbance can have a ripple effect on the entire store.
But for the most part, the benefits of selling lottery tickets seem to outweigh the drawbacks for Target. The company has been partnering with state lotteries for decades, and shows no signs of pulling back. In fact, Target has even gotten in on the lottery action itself a few times over the years.
In 2015, Target teamed up with the Minnesota State Lottery to create a special scratch-off game featuring the Target bullseye logo. Players could win up to $10,000 instantly or a $25 Target gift card. The game was a hit, selling out its initial print run of 1.2 million tickets in just six weeks.
More recently, in 2020, Target offered a special Mega Millions promotion in Indiana. Players who purchased a Mega Millions ticket at a participating Indiana Target store received a coupon for $5 off a $50 purchase. The promotion was a way for Target to drive traffic and sales during the busy holiday shopping season while also generating some lottery excitement.
Taking a Chance on Retail
At the end of the day, selling lottery tickets is just one small way that Target aims to serve its customers and stay ahead in the competitive world of retail. It‘s not a make-or-break proposition, but it is a smart strategy that aligns with the company‘s goals and values.
For shoppers, the takeaway is that yes, you can probably buy your Powerball and Mega Millions tickets at Target, as long as you live in a state that offers those games. Just remember to bring your ID, set a budget, and don‘t get too carried away dreaming of that billion-dollar payday.
And who knows? Maybe the next time you‘re in Target picking up paper towels and peanut butter, you‘ll throw in a lottery ticket just for fun. And maybe, just maybe, that ticket will turn out to be the lucky one that changes your life forever. Stranger things have happened under those big red bullseye logos.
In the end, whether you‘re a daily lottery player or just an occasional dreamer, Target is happy to be your one-stop shop for all your odds-beating needs. Just remember, as the old saying goes, you‘ve gotta be in it to win it. But you also gotta be responsible and realistic. That‘s the real winning strategy, in love, life, and yes, even the lottery.
