Business By The Books: Sports Betting Companies Market Different Than Most

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A recent survey by Optimove suggests most companies are spending their marketing dollars differently than sports betting operators.

The customer-led marketing platform provider found that 54% of the 221 senior-level marketing executives polled allocated more than half of their marketing budgets to acquire new customers. That compares to 33% that split the budget evenly and 13% that spend more on customer retention.

While the exact breakdown of marketing budgets is rarely (if ever) shared by sports betting operators, many in the industry are more focused on the profitability of current customers instead of adding as many new customers as possible.

Changing tides in sports betting

DraftKings is a prime example of the shift in the betting industry.

The operator reported cutting customer acquisition costs by 27% during the first quarter, even with significant markets like Ohio and Massachusetts launching during the quarter. The company expects to cut $50 million in external marketing costs this year as well.

The US sports betting industry is also coming down from the “peak of irrationality” concerning promos, which DraftKings CEO Jason Robins said came during the 2021-22 NFL betting season. The promotional environment has “flipped on its head” since then.

The most notable promotion seen during that period was the up to $3,300 in promo bets from Caesars as part of the NY sports betting market launch. The company pulled the offer within weeks, though, and Caesars cited a negative EBITDA of $554 million for the first quarter of 2022.

Caesars launches in California

It may not be sports betting but Caesars is starting to build a digital database in the country’s most-populous state.

The operator launched Caesars Racebook in California at the end of May, the same week the product went live in both Colorado and Pennsylvania.

The California launch makes it 16 live states for Caesars’ horse race betting app.

Splash launches P2P sports betting

Splash launched the beta for its Splash Sports real-money P2P sports betting platform, the company announced Monday.

Splash has operated “in stealth since inception,” growing RunYourPool and OfficeFootballPool‘s users to 2.2 million from just 600,000 in late 2021.

The company expects to launch Splash Sports publicly in July.

According to a release, the venture is “backed by a number of leading venture firms, including Accomplice, Acies Investments, Elysian Park Ventures, Velvet Sea Ventures, and Boston Seed Capital, along with prominent angels like Theo Epstein, Doc O’Connor, Jonathan Kraft, Mike Gordon and Sam Kennedy (Fenway Sports Group), Alex Morgan (US Women’s National Team soccer star and 3x Olympian), and various other sports team owners, professional sports bettors, and other investors and operators in sports, entertainment and tech”

Commitment to AGA sports betting marketing code

SportsGrid will abide by the American Gaming Association‘s Responsible Marketing Code, the multimedia network announced June 1.

The announcement came after the two announced a partnership to promote the AGA’s Have a Game Plan, Bet Responsibly campaign.

New updates from the Legal Sports Report team are available weekdays at 11:25 am Eastern on SportsGrid’s Newswire.

PrizePicks brings on Meek Mill

PrizePicks, which operates under daily fantasy sports licenses and laws while operating a product that looks a lot like parlays on player props, is turning to the hip-hop world for an ambassador.

Meek Mill is the company’s latest brand ambassador and culture advisor. The company found 76% of its fanbase are fans of hip-hop.

The rapper said in company material that he was “hyped” by how easy the platform was to use.