The second and final day of Sports Betting USA Digital began with Monumental Sports & Entertainment founder and chief executive Ted Leonsis, and also featured speakers from a host of leading US teams and some NBA legends.
Read iGB North America’s round-up of the first day’s debate and discussion here.
Experiences from a pioneer of sports, and sports betting
Friday’s first keynote sessions saw Ted Leonsis, founder, chairman, principal partner and CEO of Monumental Sports & Entertainment, interviewed by David Purdum, sports betting writer for ESPN.
Monumental Sports & Entertainment is the owner of the Washington Wizards of the NBA, Washington Capitals of the NHL and Washington Mystics of the WNBA, all of which play at Capital One Arena in Washington, D.C., home of the first sportsbook to take bets at a major US sports venue.
The discussion set its sights on the future of sports betting, considering questions such as technological advances to drive the sports industry forward, the future of esports, in-play betting and the changing face of stadium management.
Leonsis highlighted 5G technology as a key driver of innovation in the sports industry. Traditional television will have to innovate to keep up, he said, as the current latency in broadcasting sports will not provide an appropriate environment for esports and in-play betting.
Esports is emerging as a key investment for Leonsis, who is an investor in Team Liquid, and owns current NBA 2K League champions Wizards District Gaming. This, he explained, is not a passing fad; soon more young people would be playing NBA 2K than watching NBA games, he predicted.
That’s not to say there isn’t an audience for traditional sports and betting, as evidenced by the William Hill sportsbook at Monumental’s flagship Capital One Arena. Even as a pop-up venue, it is processing more than $10m in bets per month, and Leonsis was particularly pleased with how it helped retain visitors.
The previous business model was to open for a matter of hours and “hustle the customers out” after games ended. No other business, he said, would bring in 20,000 customers and then chase them away.
He predicted that the nature of stadiums will change, to longer opening hours where customers can enter and place bets in the sportsbook, stream sporting events from around the world and enjoy hospitality such as restaurants.
Navigating the unique gambling sponsorship challenges
This session was moderated by Ryan Knuppel, who was joined by representatives from two Major League Baseball (MLB) teams, Jason Sondag, vice president strategy and development for Chicago Cubs and Brian Glynn, director, corporate partnership sales for the New York Mets. Completing the panel was Adam Davis, chief commercial officer for Harris Blitzer Sports & Entertainment, owner of the Philadelphia 76ers and New Jersey Devils.
The discussion followed key topics in the area of sports sponsorship by gaming operators. In particular, the panellists discussed how to measure success in a sponsorship deal, the challenges faced in negotiating agreements, the future potential of sports betting, and the effects of legal sports betting upon sports integrity.
The speakers agreed that there is no one-size-fits-all approach to a successful partnership, and the key considerations are the operator’s objectives, and local state legislation.
For example, Davis pointed out, on entering the New Jersey market, William Hill had a brand recognition of under 1%. The main focus of their partnership with New Jersey Devils and the Prudential Center was therefore to generate greater brand awareness among sports fans.
For Caesars, on the other hand, the ultimate objective was to generate greater footfall at their land-based venues, and sports betting is therefore a way to create broader engagement with their brand.
The Cubs’ Sondag agreed, stating that it depends on what assets the operator holds in that particular state. Caesars, Twin Rivers and Churchill Downs, for example, all hold land-based assets in Illinois and would therefore hold different objectives to, for example, DraftKings or FanDuel when looking to sign a partnership agreement.
Sondag argued that the key challenge is not to get too far ahead of enabling legislation. The natural tendency, he said, once legislation is passed, is to push ahead as quickly as possible, however he pointed out the importance of being patient, and waiting to see what kind of betting activity occurs in the state, which subsequently determines the marketing budget of operators.
The Mets’ Glynn added that league restrictions are an additional challenge, as not all professional sports organisations have the same rules on the kind of sponsorships teams can accept.
These safeguards, Davis added, meant that potential integrity risks were largely a misnomer.
Sports integrity will be safer than before as legal sports betting is bringing a black-market activity into the light. Instead, betting would actually raise integrity standards, as it allows for more effective monitoring of potentially nefarious activity, he explained.
How players are viewing the evolving sports betting opportunity
This session brought together Scott Rochelle, executive director of the National Basketball Retired Players Association (NBRPA) along with NBA superstars Caron Butler and Stephen Howard to explore the mind-set of how pro athletes across the US will be viewing the exploding sports betting opportunity.
Key themes to be discussed were the size of the sports betting opportunity at the state level and how professionals can be involved.
Rochelle said players are keen to get involved with sports betting as the rules around it relaxed, and more are looking to take up opportunities with the industry. As players’ names and likenesses are already being used in the industry, for example with fantasy sports, players are keen to find a way to generate revenue from this.
The NBRPA is giving players the opportunity to gain revenue, amplify their personal brands and become involved with sports betting.
Rochelle continued that the concern now is waiting to figure out how the sports betting opportunities settles within the NBA and what further rules and regulations emerge. Historically it is a taboo activity but when the taboo is removed, it can be monetized sustainably by teams and players. This will require clear direction from the NBA.
At collegiate level, Howard pointed out that while colleges make millions from sports, that does not filter through to the players. He pointed out that for many college players, it will be the peak of their careers, as only 1% go on to play in top-tier professional sports leagues such as the NBA.
The issue therefore is allowing monetization in collegiate sports as this would allow college players to make some revenue during the peak of their careers.
However it’s retired, rather than future, players that stand to gain the most from sports betting. They only need to consider how their influence may help a sports betting brand, he said.
As they are not involved with playing the game, there will be no question of an impact on sports integrity through retired players’ participation in the sports betting industry.
Does the future of retail sports betting revolve around stadia?
Industry consultant David Sargeant led the next session, which looked to determine the role of stadia in the future sports betting landscape.
On a panel featuring Monumental Sports & Entertainment, William Hill and Boyd Gaming, it was natural that there was strong agreement that retail wagering would continue to play a prominent role in the future of the industry.
However, William Hill’s Dan Shapiro said the operator looks at in-person betting as an “experiential” product, with the key hook for customers being the offer of something that they can’t find at home. A strong retail offering, Shapiro argued, would in turn have a positive impact on mobile betting growth.
For Jim van Stone, of Monumental Sports and Entertainment, sports betting is a fan engagement play. Van Stone explained that around 3m people come through the turnstiles of Monumental’s flagship property, Washington D.C.’s Capital One Arena, in a normal year, and its William Hill sportsbook was expected to add a further 1m to this number.
Even in the throes of the pandemic, both he and Shapiro agreed that the pop-up sportsbook has far surpassed expectations.
“D.C. is pretty dead, with businesses and restaurants closed, but it has been more popular than we thought imaginable,” Shapiro said.
“It’s not like people weren’t doing this stuff before, they just now know they are doing it legally and that they’ll get paid.”
Boyd Gaming’s Bob Scucci took a slightly different tack, saying that it was less a case of growing sports betting alone, and more one of growing a full service entertainment experience comprising dining, entertainment and gaming.
He did add that betting alone could be a significant driver of casino footfall, pointing out that Boyd’s Iowa-based Diamond Jo Casino saw as much as 75% of its weekend sportsbook customers coming over the border from Minnesota to bet. “And I don’t see this going away any time soon,” Scucci added.
For Boyd, sports betting is a customer acquisition tool, allowing the operator to gain as much data as possible on each visitor, which can then be used to cross-sell them into other properties and forms of gambling.
“We [have] found the actual revenue is quite small, but the benefit to the casino itself or the customer acquisition on a larger scale, particularly in states where we can offer mobile, so that’s where the big ticket is for us,” he said.
As a casino operator Boyd relies on volume, Scucci added, meaning that as a driver of repeat visitation to its venues, sports betting was invaluable as a retail product.