It’s been more than 60 years since the first modern-day lottery launched in the United States. Retailers—particularly convenience store operators—have played a vital role in the success of state and multistate lottery operations.
Some 220,000 retailers across the country sell traditional lottery games. In Iowa, for example, 63% of all Powerball retail licensees are c-stores, accounting for 74% of total lottery sales volume, Matt Strawn, Powerball’s former product group chair and Iowa Lottery CEO, reported. In total, retailers earned nearly $6.3 billion in lottery sales commissions last year, according to Strawn.
While licensing regulations mean that a c-store’s share varies by state, it can be significant.
According to NACS State of the Industry Report® of 2025 Data, lottery commissions contributed $2,407 to “other” operating income in 2025 on a per store, per month basis, down from $2,425 in 2024 and $2,583 in 2023.
Hitting the Jackpot
In 2025, Powerball jackpots reached close to $2 billion twice while Mega Millions reached $983 million in November (the largest Mega Millions jackpot ever—$1.6 billion—was reached in 2023). Those jackpots created a boom for c-store traffic as well as other lottery sales, according to retailers and state lottery officials.
“We have higher ticket sales when the jackpots are big,” said Shital Patel, owner of Commissary Food Market in Philadelphia. The store has sold several winning tickets in recent years, and that reputation has made it a destination for many players.
Chris Kerber, owner of CD’s Quik Mart in Hopkins, Michigan, noted that while overall lottery ticket sales are up at his store, “It sometimes seems that the only time people buy lottery tickets is when the jackpot is big.” Still, ticket purchases during those large jackpots often result in add-on sales of other merchandise, such as CD’s fresh pizzas, he said.
Lottery officials concur that in addition to generating consumer interest and demand, large jackpots also create a halo effect that benefits other lottery products. Pointing to the $1.8 billion Powerball jackpot won on Christmas Eve in 2025, Strawn said that while it was no surprise Powerball sales skyrocketed in Iowa during the run up to the drawing, month-over-month scratch ticket sales increased nearly 12% as players added instant tickets to their baskets while making a Powerball purchase.
“Rising tides raise all boats,” said Brian Rockey, president of the North American Association of State and Provincial Lotteries (NASPL) and director of the Nebraska Lottery. While in Nebraska about a third of the population waits until a jackpot reaches a certain level before purchasing a ticket, once it hits that threshold, instant ticket sales also increase, Rockey said.
Overall, David Gale, NASPL executive director, said that “the biggest advantage of large jackpots for retailers is that they increase foot traffic.”
Mega Millions, Mega Sticker Shock
In addition to the huge jackpots, 2025 also saw an increase in Mega Millions ticket prices. Single ticket prices increased from $2 to $5 in April of last year, a move expected to result in more frequent large jackpots and improved chances of winning.
Rockey explained that without a significant increase in draw lottery players, one of the few ways to build the big Mega Millions jackpots that appeal to so many consumers is to “adjust the price and the matrix. For consumers, that provides a balance in the value proposition—the risk and the reward.”
Several months after the Mega Millions ticket price hike, c-store operators reported pushback from customers.
“A lot of people won’t buy them anymore,” said Kerber. While in the past, some customers would buy five $2 tickets at a time, “now, they’ll just buy one when the jackpot gets close to a billion dollars,” he noted.
That’s also the case in Philadelphia, where Patel said, “customers don’t like to spend the $5.” As a result, $2 Powerball tickets are outperforming those of Mega Millions at Commissary Food Market, she said.
Powerball Expands Partnerships
Powerball is sold in 45 states and the District of Columbia. While data varies state by state, Strawn said that through the first six months of the Iowa Lottery’s current fiscal year, Powerball comprised approximately 20% of all lottery sales.
In recent years, Powerball has made significant investments in national partnerships, such as the season-long NASCAR program that culminates in a live $1 million Powerball drawing on NBC before the NASCAR Cup Series Championship Race in the fall.
In 2026, Powerball has expanded its national partnership footprint to include emerging and fast-growing professional sports like disc golf and pickleball, Strawn revealed, as well as the forthcoming Powerball Xs & Os, a lottery game collaboration between Powerball and the National Football League (NFL).
In other news, the Multi-State Lottery Association (MUSL) launched the new daily draw game Millionaire for Life in February, replacing the previous Cash4Life and Lucky for Life games. At $5 a ticket, Millionaire for Life offers top-prize winners $1 million per year.
While draw games have received their share of headlines in the last year, instant or scratch-off games remain very relevant. Rockey noted that the price tier component of many scratch tickets has been a big differentiator versus traditional draw games and lotteries have started to diversify the draw portfolio based on price point.
At CD’s Quik Mart, sales of instant tickets are robust. Pointing to some tickets that cost $50 a piece, Kerber said, “It’s crazy how many of them I sell.”
Future Stakes
Now a mature business, lotteries are working to stay relevant for consumers and the changing face of retail. Consumer demographics are a concern as lottery agencies grapple with attracting younger players to replace aging core lottery customers.
Unsurprisingly, the lotto industry is placing bets on technology. “We’re always looking at the latest technology that streamlines the process for retailers, whether it’s to allocate tickets, cash tickets, or returns,” said NASPL’s Gale. In fact, he noted that the organization is working on a project that would feature a bar code on instant products, thus “streamlining the process of validation.”
In-store kiosks, which are legal in most states, can save c-stores on labor, Rockey said. But the self-serve machines also provide a space challenge.
“Lotteries are getting squeezed for counter space at the same time store footprint often limits the potential for lottery self-service machines,” said Strawn, adding, “That’s unfortunate because current trend data indicate retailers with lottery available at both the checkout counter and self-service kiosks see significant sales growth without cannibalization.”
According to lottery company Scientific Games, sales of “fast play” games—like scratch-offs but played at a terminal—grew 1.9% from 2024 to 2025, increasing by $28 million. That growth was supported by “new price points, enhanced prize structures, omnichannel strategies, progressive jackpots, and games with simple play mechanics that continue to attract players.”
Retailers and lottery officials acknowledge the benefits lottery provides c-store operations. While base commissions might be modest—ranging from 5% to 8% in Powerball jurisdictions, according to Strawn—awards for selling winning draw tickets can be generous. Bonuses can range from $10,000 up to $1 million for a retailer that sells a grand prize Powerball jackpot, or lotteries may apply a bonus as a percentage of the jackpot, typically capped at a specific dollar amount.
Other monetary gains come in the form of increased foot traffic, attracting new customers and boosting incremental sales. “The margins aren’t great [on lottery] but they get people in the door, especially during big drawings,” said Kerber.
