In the Why of Sports Betting – Part I, we focused on where sports betting fits into the casino industry. After establishing this as an expansion of the entertainment value experience of the casino, now we need to determine the best methods to maximize its profitability.
Let’s start with one of our key questions– how are you attracting guests to your property and engaging them with your product? If you remember in Part I, we talked about:
There have been billions of dollars spent on attracting these players, and probably the main concern of those companies is being profitable. As operators we need to find the best solution that fits your needs and then build on that, allowing all sides to be profitable.
The solution to start with is already in your possession, your database.
Your database is one of the prized possessions that, no matter who you decide to partner with, everyone will want access to. While this is not all bad, there should be certain precautions in place to protect how this data is shared.
Key considerations include:
- When and how often they can contact members
- What they can send with prior approval
- What you may be able to receive by having your members sign up with them
All of these can be mutually beneficial, but you should not blindly give this information away. Within your database, you possess valuable information, such as name, address, email address, activities they like to participate in, games they like to play, what they like to eat/drink, and the list is endless. A large part of the Retention and Reactivation that we mentioned earlier is dependent on this information to understand what guests will react to, and you already have it. You will also want to make sure that your casino management systems “talk”, or are compatible, with your partner’s system.
Profile of Sports Bettor
Understanding who a sports bettor is has a large impact on your ability to attract them to your property or your site.
Let’s look at some statistics:
- Over 60 million adults bet on sports, up 9.4 million from 2021
- 66 % Male, 34% Female
- 53% of new sign-ups are Female
- Mostly younger multicultural Males
- 1 in 3 Non-Whites
- 1 in 5 White
- Football is by far the most popular sport to bet on
- NBA Basketball is second
- Of those interested in soccer, 58% would bet on it (think World Cup)
- 24% of all bets are parlays
- 42% of parlays include more than one game
Use this information when building a structure for the type of wagering and markets that you offer. When you look at the profitability of sports betting, the general assumption is that there is about a five percent profit margin. If all games offered a 10 percent markup and half the people bet on one side and half on the other, that would be pretty close, but that’s not the case anymore.
When you look at all the different types of wagers, it’s not just about how many points one team is giving or getting and if they cover. You have the money line, props, parlays, half time, futures, in game, and the list is endless. All of these different wagers allow you to boost that profit margin from eight percent to nine percent. If you look back at the statistics, almost 24 percent of all bets are parlays. People like wagers that have big payouts, just like in a casino. This is where the difference between a good sports bettor and an average sports bettor looks for an edge, and they’re all looking for an edge.
Traits of a good sports bettor are:
- Processes information well
- Has financial and emotional intelligence
- Has excellent math skills
- Is willing to accept risk
- Takes a break when necessary
Traits of the average sports bettor are:
- Outgoing and opinionated
- Is an expert in every sport (in their mind)
- Is an action junkie, needs to have a bet working at all times
- Bets with emotion more than statistical backing
- Bets for the wagertainment aspect instead of the profitability
Whether the guest experience is retail, onsite in your casino, or online, ultimately it comes down to offering your guest a great time while leveraging whatever your state or jurisdiction allows.
If it is onsite, then you want to create options that benefit your casino.
- Cross-marketing sports bettors are typically table games players (blackjack, craps, poker)
- Don’t forget slot players; a gambler is a gambler.
- Play to the home team; use professional, college organizations to host events during their games. Leverage local personalities to host.
- Create reoccurring visits with contests or handicapping events
- Special events that include UFC/boxing, championship pools for basketball, and professional and college basketball championships etc.
Lastly, but certainly not least, let’s cover what your sports book should look like. That can vary from the Circa in downtown Las Vegas to a corner with a couple of kiosks in the back of your casino. Most importantly, it should fit in with what it takes with your property to become more profitable.
Profitability should be the focus once again for you and your partners’ long-term success. How do labor, hours of operation, and amenities impact what your design should be? Listed below are the top five things to make your operation successful, regardless of size:
- Programming: Bettors like to be able to watch the events that they have money on. Do you have the right networks or access to events that you want to feature?
- Channel Changing: Just as important, do you have team members who know how to change channels? Don’t assign the access to change the channels to IT, surveillance, or another department. If your ten-year-old at home can do it, then so can your sports book team members, bartenders, or pit team members, so train them how to use it.
- Convenience: Make it easy to bet. Staffing adequately so that you have team members at the windows or a combination of enough kiosks so that guests are not left waiting in line and it’s easy to cash in after hours.
- Variety of Wagers: Offer enough trading wagers that guests make that extra bet. Have plenty of betting sheets available so that guests don’t have to guess what the lines are.
- Comfort: Regardless of size, make your guests feel comfortable with seating, TV size and selection. Make sure to have drink and food selections nearby.
- Training: As in all areas, have team members who are trained to answer questions and solve problems. Nothing is more frustrating to a sports bettor than team members who respond with “I don’t know.”
- Be aware of upcoming changes in programming (e.g., Amazon).
There are many more other things to take into consideration, but most importantly, make sure that guests have fun and keep them coming back.
Good luck and happy wagering!