By Dr. Ellen Zavian
(Editor’s Note: The following was published from My Legal Bookie, a Hackney Publications periodical that tracks the legal sports betting industry. To subscribe for free, visit https://mylegalbookie.com/)
We had to move quickly to keep up with PointsBet – the sportsbook for live betting and official sports betting partner of NBC Sports. Although founded in Australia, PointsBet is headquartered in Denver, CO, with an online sportsbook presence in NJ, IA, IN, IL, CO, MI, WV, VA, NY and PA, while also being live with online casino in MI, NJ, PA, and WV.
In June, PointsBet announced a $94.16 million ($65+ million US) strategic investment from SIG Sports, which will allow PB to continue its expansion in the North American sports betting market – an industry that generated $57.22 billion in handle and $4.29 billion in revenue in 2021.
Given the company’s ascension as a leader in the space, we sought out Jake Williams, US Chief Operating Officer at PointsBet, for some insights. Prior to Williams joining PointsBet in 2021, he was with Sportradar, starting as legal counsel, then as Director of Legal Affairs, and finally in 2018, as VP of Legal & Regulatory Affairs. His work focused on legal issues pertaining to sports data, sports integrity, international sports law, and gambling.
Question: The recent announcement of PointsBet securing an investment from Susquehanna International Group (SIG), a Pennsylvania-based financial trading firm, making SIG the largest shareholder in the sportsbook (exchanging a 13% stake in PointsBet for USD 65.5m), is being touted as a move to enhance the in-play betting experiencing while expanding the company’s North American footprint. How will your role be part of this strategy?
Answer: Having a legal background and experience working in the data and technology space, I’m looking forward to seeing firsthand how this investment and partnership will move the needle in the industry, particularly as the US market continues to evolve and mature.
Whilst the US market is diverse in its regulatory regimes, state-by-state operating models, and localized sporting preferences, what is clear is that product and price will play a key role in the continued evolution of customer loyalty. In addition to brand, technology, and marketing investment – among other pillars – price and product will be what sets market leaders apart from the competition.
As we explore the capabilities and depths that this area of the business can tap into, my focus will be on working with our quant, analytics, and trading teams to further innovate and expand the scope of our current capabilities.
Q: In a recent op-ed in the media bylined by PointsBet USA CEO Johnny Aitken, he states “At PointsBet, wagering on golf has grown over 10 times since our entrance into the U.S. market, but it still only accounts for about 5% of all bets—with NFL, NBA, college football and college basketball taking the top spots. The key to closing the golf wagering gap and elevating golf as a top betting sport is live, in-play betting and its potential to draw in a new generation of smartphone-wielding sports bettors. Historically in advanced markets such as Australia and Europe, data has shown the propensity to watch an event increasing up to five times if they’ve had a wager on it.” How is the move towards in-play betting impacting how fans and bettors consume live sports? Are there any concerns that in-play betting is taking away from the experience of watching sports live and in-person?
A: In-play betting is still a very new concept to the US sports fan and even in some cases to the sophisticated bettor. It is not unusual for some bettors who may be accustomed to the typical “Vegas” style betting, which is predominantly pre-game wagering, to not even fully realize the vast offerings that currently exist from an in-play perspective.
Having something riding on the outcome of a sporting event drives higher and more engaged viewership, whether that is a fantasy game, a March Madness bracket, a Superbowl square, an in-play bet, or simply watching your favorite sports team compete.
As we move toward more and more in-play wagering, including more micro betting markets – such as next touchdown scorer – the propensity for engagement with the broadcast will only increase.
A compelling in-play betting product with an accompanying live sports viewing experience will continue to be a staple for many sports fans as sports betting expands across the United States. Gone are the days of needing to get your bet in before kickoff or the first pitch. Now, you can enter the game or match at any time and engage from both a betting and viewership perspective.
Q: How will PointsBet differentiate itself from big spenders like DraftKings and FanDuel, when it comes to marketing dollars spent? And, as a follow-up, it can be a challenge at times to do things that set your brand apart, so why do you feel positioning the company as the “Home of In-Play Betting” is resonating with customers?
A: The marketing budget required to compete at the top level has shown itself to be a capital intensive and ongoing exercise, especially given new state rollouts continuing.
As more and more states outline and roll out frameworks to legalize online sports betting, some of our competitors are in a rush to capture market share as quickly as possible while the industry is still new. However, it is creating an unsustainable environment defined by outsized promos and ad spending as well as the consumer going from book to book in search of a promotional offer.
Rather than flooding the market with large national advertising spend, PointsBet is determined to spend money on channels which have outsized impact. One prime example of this is our ongoing broadcast integrations with our partner NBCUniversal. Our data shows a marked increase in activity every time our odds appear on an NBC Sports broadcast.
And whilst we can be strategic about how we spend and where we invest, there are certainly other areas of focus for us, in addition to the marketing components.
We have always been heavily invested in and focused on the product and technology side of our business. Having the ability to control these aspects allows us to respond to customers and their preferences in real time.
One area we have leaned into is around in-play and engaging our customers during the event. Sports fans have shown their appetite for in-play betting to be strong and to be a critical component of their betting and viewing experience. We want to be recognized as the place where sports fans know they will get a premium and reliable in-play betting experience – and through our partnership with SIG subsidiary Nellie Analytics we’re exploring ways to further enhance our in-play product offerings.
Q: The sports betting industry in the US is still fairly in its early stages but we continue to see concerns about the frequency of ads and promos to acquire new customers. There have been similar concerns in Australia and the UK. So much so, that now sportsbooks are not allowed to give away free bets or advertise in certain spaces. How much regulation could come to the US in terms of marketing and consumer habits?
A: One of the inherent difficulties with the US market is the patchwork nature of the rollout. Given each state has the ability to legalize and offer sports wagering under any construct it prefers, naturally there are different operating models and regulations. As a result, there can be disconnect between jurisdictions, which does not always allow for scaled consistency.
The impact from this is that the ability for the industry to move closer to a widespread best practice – and implementing that is sometimes curtailed. There is already some change that is taking place when it comes to promotions, free bets, and general marketing initiatives but there is also a sense that further regulation is inevitable.
As an example, lawmakers in New Jersey have recently raised concerns about an increase in problem gambling due to an excessive amount of sports betting ads and promotional marketing.
Why and how any changes are implemented are almost as important as what they are, given the ability (or inability) for scaled adoption. A great program or responsible gaming feature may be green lit in one jurisdiction but not in another that causes challenges for getting the best practices and tools to consumers quickly. There is no doubt that consumer protections and responsible gaming tools are an area of focus for those in the industry, which translates into sustainable engagement for customers and consumers.
Q: What are PointsBet’s goals heading into 2023 in terms of expansion efforts and technological innovation?
A: Without a doubt, we as a team are looking forward to the new state launches that are on the roadmap for the upcoming 12 months. Increasing the reach of our offering is always exciting and given the unique nature of every jurisdiction we enter, there is always something new, something to learn, and challenges awaiting the business.
Our focus on product, pricing, customer experience, and our in-play offering will be areas of deepened investment. Our dedicated tech team coupled with the recent SIG Sports investment, including the partnership with Nellie Analytics, have us well positioned to accelerate in this area and continue to strengthen our offerings.
