The 15% Opportunity – iGaming Business
Retail may only make up about 15% of regulated omnichannel betting markets in the United States, but well-positioned operators are already aware of its potential, writes Scott Longley.
The relief with which the reopening of betting shops was greeted in the UK showed how much the UK sector is currently on the defensive, having to prove itself in a past pandemic environment and still with all the negativity surrounding the betting machines. under and the £ 2 wagering limit which weighs heavily on sentiment.
In contrast, the craze for retail betting in the United States is palpable and could just as easily occur in a parallel universe.
This includes Caesars Entertainment’s press release in early May announcing its partnership with MLB’s Arizona Diamondbacks. In part, this was just another sponsorship deal that comes in the wake of the Arizona legislature’s recent passage of sports betting regulations.
But at the heart of the deal is the building of a physical “sportsbook and bar concept” across from the Diamondbacks home at Chase Field. State of the art is a phrase rarely – or should never be used – when it comes to retail betting in the UK and Europe. Yet that’s exactly how this combination of sportsbook, sports bar and broadcast studio is described by the partners involved in the Phoenix business.
What emerges clearly from the Caesars and Diamondbacks tie-up is the importance that Caesars, like other gaming majors in the United States, with its sports betting and online gaming capabilities newly augmented by William Hill , sees the potential of omni-channel to stimulate customer acquisition.
As described in the press release, Caesars is hoping that once sports betting becomes available, fans with the mobile app can earn credits and tier status to unlock Caesars Rewards loyalty points which can then be redeemed. via the Chase Field point of sale.
This is not a photo in the dark. In Penn National Gaming’s recent first quarter earnings call, Jay Snowden, Managing Director, said Barstool’s promotion of Penn National sports betting has “generated significant brand awareness and footfall for our land properties.
“This is especially true for establishments that have introduced Barstool-branded sports betting and we plan to open six more by the end of this year,” he told analysts. “In addition, progress continues in the development of several Barstool brand standalone sports bar locations. We are really excited about these projects. “
The positivity around what retail sports betting traffic can do for Penn National’s casino demographics is probably foreign to European ears. Not only are Barstool branded outlets increasing the retail sports betting market share, but it means Penn National is gaining market share in casinos as well.
“By attracting all of these young clients, we’re really excited about what we’re seeing there,” Snowden said. “It’s the good thing to have this omnichannel approach where you control and own 100% of it, because we just want to bring people into the ecosystem.”
Let’s go to the ball game
What Penn has exploited with Barstool is the inherent ability of sports betting to monetize sports opinion, says David Sargeant, consultant for the sports betting industry. And in that regard, there is no greater concentration of these people than among the fans who attend on match days.
“Tapping into this fan market can be a lucrative way to build brand loyalty and ultimately generate revenue,” he suggests. “In the hyper-competitive US market, having real human touchpoints definitely boosts brand confidence. This is important for new entrants with low visibility, but can also be used by larger brands as a differentiator. “
In Illinois, the current debate is all about the disadvantage of mandatory in-person registration. But that obscures the very real benefits that retail offers when it comes to negating the downsides of mobile check-in, such as digital KYC procedures, geolocation issues, and digital payment barriers. “For many consumers, money is still king and it shows in many retail establishments, even when the digital connection is available,” says Sargeant.
But the value of retailing isn’t limited to its appeal to a segment of the public that is happier dealing with cash. Sargeant suggests that retail adds value to any brand because of what it brings in terms of phases of the betting journey, from education to acquisition and registration, deposit and placement. bets.
Perhaps due to the resounding success of online sports betting in the United States, much of these attractive features are either forgotten or ignored. But Sargeant says the negativity around retail seems to fundamentally misunderstand its place in the ecosystem. “I’m still intrigued by the scornful speech because the internet represents over 85% of omnichannel markets in the United States,” he says.
“Keep in mind that this 15% retail market share is not coming from European-style mass retailing; these numbers are generated from a handful of sites. Using retail to add a few percentage points to market share could be the factor that makes some traders profitable. I think rejecting the power of retail is a hugely missed opportunity. “
Based on recent statements from Caesars and Penn National, this is an opportunity some are already aware of.
Scott Longley has been a journalist since the early 2000s, covering personal finance, sports and gambling. He has worked for a number of publications including Investment Week, Bloomberg Money, Football First, eGaming Review, and Gambling Compliance..