Since the Supreme Court of the United States invalidated the Professional and Amateur Sports Protection Act in 2018, bookmakers have been left scrambling. They are trying to figure out how to scale their business and attract mainstream bettors.
Partnerships with media firms and celebrities, as well as mergers and acquisitions, are among the most effective methods for achieving this goal.
Penn Entertainment exercised its option to purchase for $325 million the remaining shares of Barstool Sports that it did not already control. It’s only the most recent high-profile partnership in recent years.
- In 2021, Sports Illustrated will open a sportsbook in Colorado in partnership with 888 Holdings.
- Former athlete and television figure Pat McAfee signed a multiyear contract with FanDuel’s owner Flutter Entertainment.
- FanDuel also unveiled a brand-new sports betting television show hosted by Kay Adams, a former NFL Network host.
- DraftKings has collaborated with Turner Sports and Bleacher Report to become their official daily fantasy sports and sportsbook provider.
- ESPN incorporated DraftKings, Caesar’s betting odds, and daily fantasy information into its mobile application.
- NBC Sports has invested in PointsBet, a provider of odds and betting statistics for all NBC networks beginning in 2020.
- William Hill and CBS Sports teamed to boost fan engagement through sports betting data and technology.
Why is everything occurring?
The Possibility
In the United States, legal sports betting is a nascent industry that will likely be one of the most significant in the next decade.
According to Statista, sports betting earnings in 2021 will reach $2.1 billion. Macquarie Research estimates the business to produce $30 billion in revenue from $400 billion in total wagers by 2030, with a tremendous compound annual growth rate of 35%.
With this outlook, everyone scrambles to secure their share of the pie before it’s too late.
Market Adoption
Under the sports betting market adoption bell curve, the sector is just beginning to cross the abyss (i.e., the void between early and mainstream adoption). The earliest and most devoted sports gamblers are already clients. It would help if you won over the late majorities, skeptics, and casual gamblers to achieve success.
Sports betting businesses want to learn what motivates these casual followers, how they connect and engage, and where they gather.
Media businesses and content suppliers have years of experience supplying sports information and analyzing data to improve the user experience; sportsbooks require this knowledge.
The Benefit
A company’s marketing performance can be measured using customer acquisition cost (CAC) and client lifetime value (LTV). If the expense to bring in the consumer is higher than the average monetary value they would eventually deliver to the company, it’s a terrible investment.
The appropriate LTV justifies the ostensibly expensive CAC faced by some sportsbooks due to high marketing expenses and a propensity to pay for valuable real estate inside top sports media content.
The Conclusion
In addition to the obvious attractiveness of getting a presence in a fast-expanding industry, media businesses benefit from entering the multibillion-dollar sports betting market by:
- Increasing fan engagement through various programming integrations (e.g., live betting odds, new content, data, statistics).
- Direct advertising and affiliate marketing will create additional revenue streams.
