The mobile sports betting providers understand that gaining market share is both expensive and important.
But the Hard Rock brand has a different strategy to woo customers to its digital sports betting platform.
Ready, Set, Launch!
The battle to win customers in the digital sports betting realm is not for the faint of heart nor those without deep pockets.
Considering the average person signs up with only one sportsbook, it is a fierce race to get those early adopters because if you’re not first then you’re most likely last…along with everyone else.
And because of this fever-pitch intensity, oodles of money are being poured into advertising as well as outrageous sign-up bonuses and promotions being offered in what has become a case of keeping up with the Joneses.
Sportsbooks On Onerour Tax Agreements
It’s become so reckless that some sportsbook providers are beginning to ponder the wisdom of operating in states that have onerous tax agreements.
New York is the prime example, currently raking a whopping 51 percent of the net win leaving the bookies with little profit after spending outrageous sums trying to win customers to their books.
But the Empire State is considered fertile ground for getting huge numbers of new customers as it is currently the most heavily populated U.S. licensed sports betting market.
And the financial bloodbath many of the aggressive books are taking in New York will be replicated when California, Texas, and Florida get into the game.
Sportsbooks May Consider Their Strategy
Some sportsbooks may reconsider their strategy but most won’t because gaining a foothold in a brand-new market is paramount.
Morgan Stanley recently released a report stating that the top five sportsbooks in each state control a whopping 80 percent of the market share.
“Even in Michigan, where there are 14 OSB operators, the top 5 have 90% share.
Though there is a lot negative written about the levels of marketing and promotional spending, this has driven a very concentrated market that only players of scale can really compete in,” said Morgan Stanley equity analyst Thomas Allen.
Hard Rock Plays Different Tune
Some sportsbooks walk to the beat of their own drum. Case in point, Bally’s has yet to launch in New York, even though every other licensed sportsbook is currently active, and most launched the day it went live back in January.
However, Bally’s CEO Soo Kim has been content to lay back and let the other eight operators beat each other’s brains in while his Bally Bet app lays dormant until what is expected to be the end of the summer.
New York’s Battleground
Alan Woinski, a gambling industry analyst and consultant, spoke bluntly about the New York battleground, “It’s great for New York, it’s pretty damn good for the bettors, it’s an absolute disaster for the operators. It’s war. They’re killing each other.”
Another sportsbook executive is taking a similar approach to Bally’s and he happens to be Matt Primeaux, Executive Managing Director, President of Hard Rock Digital.
His betting platform is only available in Iowa, New Jersey, Arizona, and Virginia with Tennessee and Indiana on the docket.
Hard Rock Different Approach
“Hard Rock Sportsbook is taking a different approach than our major competitors. We are building a robust, sustainable business and aren’t interested in simply buying market share at an irrational price.
Rather, we’re investing in the foundation of the business for the long-term — in a product, marketing technologies, and cultivating an innovation-minded team.
“While some of our competition is looking at a three-year payback period on their marketing spend, we’re using the power of the Hard Rock brand, our in-house data science team, and executional know-how in our marketing division to scale into a 9- to 12-month payback period”, said Primeaux.
Calculators
