PointsBet has spent plenty in the US but has not yet been able to break into the top tier of US sportsbooks.
The operator reported marketing expenses of $118 million for its fiscal year ending June 30 during its most recent earnings call.
While that figure might seem high on a glance, it is still dwarfed by marketing spend of some of the biggest operators in the US space.
That marketing spend has led to a US blended online market share of just 3.7%. PointsBet invested $25 million on its New York license and $11 million on its Pennsylvania license. It has a 2.9% share of online NY online sports betting handle and a 2.4% share in PA.
What does handle share look like by state for Pointsbet?
PointsBet broke out its handle share by state in its earnings presentation:
- Illinois: 8.8%
- Colorado: 3.6%
- New York: 2.9%
- Virginia: 2.7%
- New Jersey: 2.6%
- Michigan: 2.6%
- Iowa: 2.5%
- Pennsylvania: 2.4%
- Indiana: 2.1%
- West Virginia: 1.6%
PointsBet exec: Marketing efforts necessary to grow
PointsBet closed trading in Australia at A$2.90 a share on Wednesday, down 11.9% on nearly triple its average volume. And, overall, its fiscal 2022 EBITDA loss in the US was $135.3 million. Still, the operator believes its marketing efforts were worthwhile.
“We had to spend to go from the bookmaker no one’s heard of to being the seventh biggest in North America,” PointsBet managing director and group CEO Sam Swanell said, according to the Sydney Morning Herald.
The operator, however, will not be increasing its US marketing spend for the upcoming fiscal year.
“Looking towards FY ’23, we anticipate the U.S. marketing expense will be no greater than the FY ’22 U.S. marketing expense,” PointsBet CFO Andrew Mellor said on the earnings call. “As we continue to regionalize our marketing expense and reduce spend in some of the less targeted acquisition channels.”
What’s next in US
PointsBet anticipates being live in 14 states by the end of fiscal 2023, focusing on state rollouts in Kansas, Louisiana, Maryland and Ohio.
In-play betting remains a possible differentiator as PointsBet looks to make up ground.
“Our mission is to create the best in-play betting experience for our customers to progress in a positive direction, with in-play expected to represent 75% of all bets in the US within the next three years,” PointsBet US CEO Johnny Aitken said.
Overall, PointsBet’s net losses increased 43% year-over-year ($183.4 million in fiscal 2022).
Staying patient with Canada
“Let’s give them an opportunity to ramp up through the NFL season,” Swanell said. “I know from an appointment perspective, a lot of our partnerships and marketing initiatives are structured around the upcoming seasons. So yes, we’re not ready to (write) off Ontario just yet.”