SBC Summit: As gaming evolves, sports betting and igaming become increasingly convergent

July 14, 2022 4:54 PM
  • Rege Behe, CDC Gaming Reports
July 14, 2022 4:54 PM

Sports betting is the poster child of emerging gaming models, promoted by star ambassadors, ubiquitous on televised sporting events, totally permeating the culture of sports.

Online gaming has a decidedly quieter presence. Yes, there are commercials for icasinos, but they tend to lack the sizzle of promotions featuring Jamie Foxx or the Manning family.

But as sports betting and igaming evolve, increasing evidence shows that they are inextricably linked.

“You see a lot of gamification mechanics translate across channels or news,” said Delaware North Vice President of Marketing, Gaming Luisa Woods Wednesday at the SBC Summit North America at the Meadowlands Exposition Center in New Jersey. “So while the business and activity of sports betting are quite different than casino gaming, the engagement opportunities are places where it crosses over very easily between the two.”

Woods spoke at the panel “SBC Leaders — Converging Worlds of Igaming and Sports,” moderated by Playtech Vice President, US Business Development Jonathan Doubilet.

Online gaming is less prominent because of its small footprint. Unlike sports betting, which is live in 30 states and the District of Columbia and legal but not operational in five states, igaming is only available in six states: New Jersey, Delaware, Pennsylvania, West Virginia, Michigan, and Connecticut. There are signs, however, that gaming operators increasingly see the value of online gaming.

Rob Picard, Rush Street Interactive vice president of business development, noted the “savvy acquisition” of Golden Nugget Online Gaming by DraftKings in May 2022 as an example.

“I think there’s a number of opportunities,” Picard said. “We’ll definitely see consolidation, mainly because the online casino operators, the technology that goes into gamification that Luisa (Woods) mentioned, the engagement with the customer and from the sports betting side, it’s kind of a transactional second screen; you’re watching the game.

“But from an online casino perspective, you have to engage and entertain customers while you have them captive on the iPhone. I don’t think a strategy of simply putting up third-party content on an iPhone is enough to retain those players. You have to have a gamification layer.”

Rob Lekites, GAN Sports VP of North American Sportsbook Sales & Operations, suggested that it’s essential that operators deploy a single platform, enabling operators to “cross sell.”

“Putting out a free spin and a sports-bet slip is really important to help them convert players,” Lekites said. “I think technology is the key. I agree consolidation is happening. But working ahead of time, because igaming is in its infancy stage, to be prepared to be prepared to convert those sports players to igaming players at the flip of a switch, is incredible.”

Doubilet suggested that the lack of a “historical nationwide sports-betting industry” in the U.S., where gaming has traditionally been driven by brick-and-mortar casinos, has hindered the development of mobile sports betting and, consequently, igaming.

Wondr Nation President and CEO Anika Howard noted that the United Kingdom’s online gaming developed from a culture of sports-betting shops. Sports betting, Howard said, is ingrained in that culture, unlike in the U.S. where it’s become legally available outside of Nevada only since the repeal the Professional and Amateur Sports Protection Act in 2018.

“Many markets are getting sports betting, both retail and online, at the same time,” Howard said.

DraftKings and FanDuel, however, have been successful, because they were able to cultivate their active fantasy sports players into becoming sports bettors.

“(DraftKings and FanDuel) were able to come into the market very early on and capitalize on that. They did create that culture of sports betting and social engagement,” Howard said. “What we’re seeing now is a lot of acquisitions, like between Caesars and William Hill and Penn and Barstool (Sports),   a lot of this consolidation. There’s a need to say that you want to control that whole ecosystem. And one of the things we’re seeing is that sports-betting customers translate very well into icasino players. Building that relationship, having that platform that allows you to seamlessly integrate, is really important.”

Rege Behe is lead contributor to CDC Gaming Reports and can be reached at rbehe@cdcgaming.com. Please follow @RegeBehe_exPTR on Twitter.

Rege Behe is lead contributor to CDC Gaming Reports. He can be reached at rbehe@cdcgaming.com. Please follow @RegeBehe_exPTR on Twitter.