INSIGHT
MEETING
OF
MINDS
Rather than tackling things alone, European and US operators need to get their heads together
and collaborate if they’re to seize the opportunities flowing from PASPA’s repeal. Joined-up thinking
(and working) is the future, writes Sarah Robertson
WITH CHANGE COMES OPPORTUNITY.
No maxim better defines the US sports-
betting market following the Supreme
Court’s repeal of PASPA in May this year.
PASPA’s fall has created an environment
in which excitement and analysis about
forthcoming state legislation and strategic
frameworks abound.
As with previous regulatory shifts,
stakeholders in US and European markets
can increase their potential for success
by working together on strategies and
solutions. The list of potential areas for
collaboration is extensive; here are several
of the most noteworthy.
Affiliate marketing
Affiliates have been important stakeholders
in the growth of regulated online casino
and poker in the US but sports betting is a
different prospect altogether. Fortunately,
the level of expertise in the European
market is seasoned and well placed to
provide strategic insights for both long
and short-term objectives. Making the most
of regulated sports betting will require
partnerships founded on shared knowledge
and a willingness to assume leadership
roles, guiding affiliates and positioning
them for enduring success.
As has been the case with casino and
poker, clarifying the terms under which
affiliates are able to operate within US
markets is demanding but achievable.
Having navigated evolving legislative
frameworks when the US reopened its
doors to igaming, affiliate marketing
has established a presence in the sector.
US sportsbooks and affiliates hoping to
leverage the channel for sports betting will
need to rely on similar resourcefulness and
expertise from overseas-based stakeholders.
According to analytics outfit iSpot.tv,
DraftKings and FanDuel spent more than
$300m between them on TV ads in 2015.
While daily fantasy sports (DFS) and sports
betting are distinct products, it is notable
that both brands significantly scaled back
their TV ad spend the following year,
cutting it by more than 90% between
2015 and 2016.
While new entrants to the US market
will spend millions advertising through
traditional media, they should also
consider digital tactics. It’s here that
affiliates can integrate as part of a broader
digital-marketing strategy, given their
potential for high acquisitions with smaller
upfront costs.
State-by-state marketing strategies
According to Standard Media Index,
NFL in-game advertising was down 1.2%
in 2017 but it still achieved $2.42bn of
revenue. This figure highlights the scope
of the advertising environment within
which new entrants to the US sports-betting
market will operate.
The impact of legislation on traditional
and digital-marketing strategies will
become clearer as each state passes its own
rules and regulations. Evercore ISI analyst
Anthony DiClemente takes an optimistic
outlook, estimating in a note to investors
that sports betting could result in “$7bn
incremental US ad spend in 2019”.
It will be interesting to monitor PPC
advertising policies, the cost of related
media buys and any surge in App Store
offerings despite tight restrictions on
interstate sports betting.
The autonomy enjoyed by individual
states should give local experts the
opportunity to offer support through their
knowledge of market trends and state
policy. This can be leveraged by European
stakeholders already equipped with
strategic resources if they are effectively
deployed through comprehensive planning.
This is one of several areas where the
existing sports-betting market in Nevada
will come into play. William Hill US,
arguably the most influential name in
Nevada sports betting, should inspire
prospective entrants. Their priorities
will presumably include mobile app
development, geo-targeting requirements
and creating a symbiotic relationship
between land-based and online properties.
The key lesson from William Hill’s
success is the importance of preparation.
It’s difficult to predict which states will
permit single-event wagering in casinos
and which will eventually accept online
wagers. But it is crucial to prepare strategies
in anticipation.
Preserving integrity
Many questions regarding post-PASPA
marketing strategies will also be relevant
to building a positive image. Adhering to
guidelines that will underpin US sports
betting must be a matter of policy from the
outset, regardless of when a state enters the
iGB Affiliate Issue 70 AUG/SEP 2018
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