Missouri sports betting handle took a big step back in its second month, dropping almost 30% to $384 million.
Revenue also tumbled nearly 50% to $53.3 million according to the January report released Friday. The dip was mostly a byproduct of a reduction in operators’ promotional spend as compared to the days and weeks that immediately followed launch in December.
First-month overperformances have been a facet of recent sports betting launches in some other markets, including Vermont and Ohio.
DraftKings leads Missouri sports betting
National leaders FanDuel and DraftKings continue to disappoint anyone who was hoping the Missouri sports betting market would be more competitive in the early going. The top duo have combined to account for close to 75% of handle and 80% of revenue through the first two months of legal betting in the state.
DraftKings had an especially nice January report, standing its ground with $144 million in handle to inherit first place. Its revenue came to $22.8 million – also the best on the board – with 16% margins that were exaggerated by free bets.
FanDuel’s handle, meanwhile, dropped more than 40% to $125 million, giving up the lead but still producing a full third of all wagering for the month. Hold was also around 16% to yield $19.6 million in revenue.
Peter Jackson, CEO of FanDuel’s parent company Flutter, said during Friday’s Q4 remarks that Missouri’s launch was among the company’s best ever in terms of market penetration, reaching 5% of the population within 30 days.
“Missouri … is a really good example of when you’ve given customers or consumers the choice, the breadth of offering you have in traditional OSB, together with the generosity playbook you can provide means it’s a much more compelling offer,” Jackson said.
A promo in every pocket
Operators together gave away $33.1 million in free bets for the month, though that is down significantly from more than $125 million in December. Promo spending is still elevated, though, at almost 10% of handle and two-thirds of revenue in support of ongoing acquisition in month two.
The early generosity from bet365 reflects a particular eagerness to compete in Missouri, leading in spend percentage for the second straight month. Its $6.86 million in free bets represented more than 20% of its handle for January — by far the highest of the eight active brands. FanDuel and DraftKings both spent more in raw dollars but a smaller percentage of their totals.
Those free bets helped operators to a combined 13.9% hold for the month on paper, substantially higher than the national average of 11.1%, though artificially inflated by the promotional outlay.
For a sense of where the numbers are headed: most markets tend to level off at a monthly promo rate around 3% of handle or 30% of gross revenue over time.
