The Super Bowl has been played. The Kansas City Chiefs defeated the Philadelphia Eagles in what might be called the Betting Bowl. It was the first time the Super Bowl had been played in a venue where betting on the game was legal. It was also the first time it was legal to bet on the game in a home state of both teams.
Bettors in Kansas reportedly wagered $24.7 million on Super Bowl LVII. The Chiefs won on the field and the fans won at the bookmakers. Retail outlets had a minus 77 percent hold and online operators reported a minus 56 percent. In Pennsylvania, $84 million was wagered on the game. The bookmakers kept $29.7 million. In Nevada, $153.2 million was wagered and the bookies kept only 3.5 percent. The reasons are simple: In Kansas and Pennsylvania, fans bet with their hearts, in Nevada as always, the gamblers bet with their heads. New York mirrored Nevada and operators booked $123.8 million on the game, keeping 5.6 percent.
The game marked the end of NFL season. It also marked a turning point in the annual cycle of sports betting. In 2022 between September and December, approximately $48 billion was wagered on sports. The numbers are not in yet for January or February, but they will likely add nearly another $20 billion. If the Super Bowl is the Betting Bowl, then football is the wagering season. Nothing generates more interest and betting than the National Football League. Only one other event comes close: the national collegiate basketball playoffs and championship, known as March Madness.
Professional baseball, hockey, and basketball and the minor sports of soccer, track and field, and tennis have their fans, for sure. Each also attracts betting, but nothing that compares with the NFL. Sports betting is seasonal. Casino gaming is also a seasonal industry; its revenues vary greatly from the busy to the slow months. That is one of the reasons that it makes no sense to compare revenue month over month. The only meaningful comparison is year over year. Sports betting is a seasonal industry on steroids.
This year is the second big year of sports betting. The industry has been growing and expanding since May 2018; by 2022, sports betting had hit full stride. Traditional sports journalism is new to the betting game and its coverage has been a bit behind the curve. It has covered sports betting as it does games, from one game to the next, or in this case, from one month to the next. From February through September, sports reporters insisted on comparing each month to the previous month, rather than the previous year. With 2022 as a guide, 2023 should be different. To see if the sports journalists have adjusted, we will have to wait until April. February had the Super Bowl and reporting on the amount of money bet on the game will obscure other narratives. March is unique; March Madness is huge for fan and bettor interest. April will be the first month that reporters realize there is no real story in the sports-betting numbers.
In 2022, the handle decreased every month from April until September. The handle in March was $9.2 billion and by August, it had dropped to about $5 billion. In September, the handle jumped 59 percent over August. In October, November, and December, the handle was double August’s. Starting in April, betting will be slower month after month, but annual growth is almost assured. There will be several states that are new to sports gambling. Ohio, Massachusetts, Nebraska, and Kansas are just beginning to accept bets. Arkansas and Maryland have added mobile wagering. These additions alone should make the handle in 2023 better than in 2022.
By way of comparison, New York initiated mobile wagering in January 2022. Previous to authorizing remote wagering, the retail handle in New York average between $10 and $20 million a month. The first month of mobile wagering the handle was $1.6 billion; only July and August were less than $1 billion. Tellingly, in January 2023, the handle was just shy of $1.8 billion. Arkansas, Kansas, Maryland, Massachusetts, and Ohio will be offering remote wagering in 2023. The numbers will be interesting.
There will be several sports betting narratives in 2023. The first will be the growth of the industry over 2022, fed by new jurisdictions and increased media attention. The second and arguably the most important narrative over the long run is remote wagering. The top five states for both handle and win every month are states with mobile wagering — New York, New Jersey, Pennsylvania, Michigan, and Illinois. Those states have the prerequisites for a successful sports betting industry, namely, large populations, and remote wagering.
After March Madness, we wait for the NFL to take the field again. Mobile betting is a story that can keep us awake, entertained, and informed on the true nature and health of the industry.