The Texas Lottery Commission recognizes its responsibility in generating revenue for the state of Texas and emphasizes fiscal accountability for expenditures. The Commission requires our advertising agency to obtain three bids for all television productions. Production for the new $200 Million Cash Spectacular game was competitively bid and the lowest bid was selected. The television production costs for $200 Million Cash Spectacular are consistent with the production costs for other lottery television commercials. The Commission makes considerable efforts to appropriately and effectively allocate its advertising dollars to reach the public and optimize revenue.
The Commission’s advertising budget has decreased from $40 million in 1993 to $32 million in 2011. With the effects of inflation, this decrease is even more dramatic; a $40 million budget in 1993 would equate to $59.1 million in 2010. A reduced budget, combined with the Commission’s vastly expanded game portfolio, requires the us to pursue an extremely efficient advertising strategy. Working at the request of the Commission, the University of Texas conducted an analysis several years ago of the potential return on investment for the agency’s lottery advertising dollars and determined that for each additional dollar spent on lottery advertising, an additional $5 to $25 in lottery sales could be anticipated.
The $200 Million Cash Spectacular game has been a very successful product for the Commission, generating a total of $77.9 million in sales and contributing $12.5 million in revenue to the Foundation School Fund of Texas during its first 16 weeks in the market. In fiscal year 2011, the Texas Lottery generated a record $3.8 billion in ticket sales and is on track to produce a new sales record in fiscal year 2012.
Lottery ticket sales the last few fiscal years are:
FY 2012 (through 5/31/12) $3,177,258,483
FY 2011 $3,811,270,135
FY 2010 $3,738,369,487
FY 2009 $3,720,113,711