Legal sports betting in New Jersey and the US is moving fast. In the last two weeks, casinos and sportsbook have partnered with sports leagues and sports teams at a rapid pace.
The strong early returns in newly legalized markets like NJ sports betting and prospects of more expansion in 2019 is all the gaming industry is talking about.
Unfortunately, all of that buzz is leading to some hurried decisions and sometimes less-than-perfect legislation. Even though we’re only a few months into this brave new legal sports betting world, there are already valuable lessons to be learned.
In this five-part series, PlayNJ will explore five such lessons:
- Customers prefer legal markets.
- The black market thrives on the legal market’s mistakes.
- Online sports betting isn’t the future, it’s the present.
- Sports betting is going to be a high variance market.
- Don’t discount the power of a sports-associated brand.
Next up, the importance of online betting.
Online sports betting is big business
The data is clear: Sports betting is tailor-made for online and mobile wagering.
Sports betting is somewhere in the 10-15 percent range of all gaming revenue around the globe.
But according to a G2E presentation by David Henwood, the director of H2 Gambling Capital, sports betting punches way above its weight class online. As Henwood explained, sports betting accounts for more than half of all online and more than 66 percent of all mobile wagering worldwide.
Henwood also said that online sports betting is growing at 10-times the rate of retail sports betting.
If you don’t offer online betting, you’re doing it wrong
Similar evidence is already showing up in the US market.
New Jersey’s nascent sports betting industry generated $184 million in handle in September. More than $100 million of that was generated online. And that was accomplished with only a handful of newly launched NJ online sports betting sites and apps.
The percentage of sports betting that takes place online and through mobile apps is only going to increase as more sports betting sites come online and consumer awareness grows.
Even in Nevada, where online accounts can only be registered in-person at one of the state’s casinos, online and mobile wagering is nearly 50 percent of all sports betting revenue. Multiple casino operators, however, are looking to eliminate that requirement.
The other benefits of online and mobile wagering
Beyond revenue, online and mobile sports betting have several other benefits.
Online and mobile wagering:
- Is the only way to make inroads against the offshore black market sports betting operators. Online sports betting is a delivery method that black market customers are accustomed to, and in most cases prefer.
- Is the perfect delivery system for the increasingly popular in-play betting, that often requires instant actions. It’s far more convenient to click a button on your phone to lock-in a line then head to a betting window and hope you can place the bet before the line changes or the outcome is final.
- Provides game integrity, consumer protections, and fraud detection. By tracking each and every bet, and each and every deposit back to a verified person, online wagering does a better job of sniffing out everything from money laundering to problem gambling.
- Allows sports betting operators to reach customers in remote areas that might be hours away from a brick and mortar sportsbook, as well as customers from neighboring non-sports-betting-states that live near the border.
Bottom line: If a state is trying to maximize revenue, online and mobile wagering isn’t a luxury, it’s a necessity.