Getting a Head Start: 4 Steps Casinos Can Take Today Towards Sports Betting

Sports betting in the USA is moving forward. It’s a rare day that passes without a new state announcing plans on it plans to deal with the future regulated sports betting market. Most operators in our industry agree that it’s simply a matter of when.

Of course, we also know that US sports betting is already happening, and it’s a $150B illegal market. The Supreme Court simply has an opportunity to right the ship towards a sensible, regulated and responsible market.

Since June, when the Supreme Court decided to hear New Jersey’s appeal to overturn PASPA, we’ve spoken to dozens of US casino operators. The common thread to nearly every conversation that we’ve had is the question: “How do I get a head start on sports betting?

Casino and track operators, of course, have countless options on how to address the potential opportunity. However, standing still is not an option, in our opinion, if you’re serious about sports betting as a long-term line of business for your property or group.

As operators look ahead and plan for 2018, we speak from experience about how casinos can cost-effectively approach sports betting.

Our Four Recommended Steps on How to Address Sports Betting Today

1. Understand the landscape and inform your strategy with free, top-tier resources.

As you do your homework: we regularly refer to these resources that will be helpful for any casino or track in the process of defining their path forward. Educate yourself as the Supreme Court case and state legislation unfolds.

In addition to the American Gaming Association’s free resources, we read:

2. Collect data and model the business opportunity.

"The ancillary revenue that’s generated off of the racebook and sportsbook is very significant, from hotel rooms and restaurants to shows, as well as from players’ propensity to gamble on other casino games."

Jay Rood
Vice President of Race and Sports, MGM Resorts International
Speaker Interviews - Sport Betting USA Conference

Fact: As a market matures, customer acquisition costs rise significantly. Today, sports betting customer acquisition costs in the US are as close to zero as they'll ever be.

In contrast (from a mature market): William Hill (UK) paid $162 per new customer acquisition in 2016. There is going to be a land grab for sports bettors over the next year or two. Follow the money...

Fact: Based on our experience, sports betting attracts younger customers than typical casino loyalty programs. When we integrated our sports book into Sun International, the average age on our sports book was 30% younger than the average loyalty program member. Read more about that here.

Where to start?

      1. Run a simple analysis of the 'sports betting value' of your existing loyalty programs and databases. You can contact us for some baseline assumptions. Also, know that there are high-quality researchers like Eilers & Krejcik Gaming that do this for a living.
      2. As you prioritize internal initiatives, how would you value your loyalty program databases if you had sports betting today? In 2020? In 2023?
      3. Assuming that sports betting is regulated in your state in , run a cost-benefit model of starting sports betting focused marketing today (and paying low customer acquisition costs) or waiting until sports betting is regulated.

5 Lessons Learned Integrating Sports Betting into a Casino

3. Start moving forward with simple, low-risk 'Sports Betting Lite' pilot programs.

One thing I learned well in the US Army: most days, no plan survives first contact. With that in mind, as soon as you find your comfort level, move forward with low-cost digital or on-property programs that will help you build a path forward as things evolve.

Start simply, and simply start. Engage your existing customer base with simple, fixed-odds mobile games and on-property interactions. Identify the sports bettors among them, and begin to personalize messaging by identifying their favorite teams, favorite betting events, etc.

Specifically:

      • Gearing up for the NFL or college football playoffs? Roll out a Free-to-Play mobile web Spread Pick'em game with live odds to build your new customer database.
      • Have an MMA or Big Fight watch party coming up? Use a Free-to-Play parlay card to generate interest, capture email addresses and sell tickets.
      • Hosting a Super Bowl Watch party on property? Use mobile-first Big Game Prop to amplify event promotion with casual fans.

For any sports-related live event, simple live-in-play mobile games will keep attendees engaged. More importantly, you'll capture contact information from 'unknown ticket holders' (as our friends in the ticketing industry call fans that don't actually purchase the tickets to an event).

Sports Betting Lite Boxing Game

4. Stay informed.

Invest in the conversation. Most active stakeholders fundamentally get that the arguments in support of PASPA are outdated. And most are interested in charting a path forward that involves firm regulatory controls, responsible gaming for customers and a sensible roll out of online.

Additional Ideas from Chalkline