When the Supreme Court struck down the federal ban on sports betting in May 2018, an increase of sportsbook advertisements was inevitable as states began legalizing sports betting one-by-one across the country. Now, with 30 states and Washington, D.C. offering live, legal sports wagering markets, sportsbook commercials with big payouts and eye-catching promotions have become ubiquitous—whether you’re tuning into NFL Sunday, watching the World Series or catching up on your favorite sitcom.
This advertising serves an important role: drawing customers from the predatory, illegal market. With a 25-year head start (no thanks to the federal government), customers are left confused about where to bet legally. Advertising—whether on TV, social media or out of home—serves as a means for player education.
The massive investment in customer acquisition is also part of being a new industry. As the market matures, the spend will naturally level off. You only have to look to the Nevada airwaves to see the difference.
However, the current saturation of advertisements and promotions is drawing increased scrutiny from consumers, legislators and the media. And regulators in states like New Jersey and Colorado are taking notice of these advertisements too, with a focus on responsible gaming concerns.
We’ve already seen this game play out in Europe, and the results have not been kind to gaming companies across the pond. The pendulum has swung from a European sports betting and online gaming boom to backlash that has led to a regulatory crackdown.
In Italy, gaming companies are under a total advertising ban, and in Spain, gaming companies can’t advertise on TV outside of the early hours of the morning. In the U.K., only 7 percent of Britons have a positive view of the gambling sector, which has heightened calls for a ban on gaming companies sponsoring sports teams—an estimated $55 million annual revenue stream for the English Premier League and a massive advertising medium for the U.K. gaming industry. In response to public pressures, U.K. gaming companies have already self-imposed a whistle-to-whistle ban on TV advertising during competitions and committed 20 percent of advertising to education.
We should view Europe as a cautionary tale for what could happen in the U.S. if we don’t take advantage of this window in time to get sports betting in America right.
The American Gaming Association and our members have been on the front foot of this issue, establishing a Responsible Marketing Code for Sports Wagering, which sets self-imposed restrictions on advertising mediums, content and target audiences. The AGA’s Have A Game Plan. Bet Responsibly campaign is also convening the industry around responsible gaming education, including sports leagues and media companies, who all play a role in determining the quantity of advertisements consumers see.
Trends are also starting to point to a seasonality for sportsbook advertising saturation. Not a single sportsbook has been inside or near the top 10 advertisers since the third week of the NFL season. And gaming industry CEOs have publicly acknowledged that current levels of industry advertising are financially unsustainable.
But our efforts must continue to evolve as the market expands and matures. The AGA and our members are working on solutions to this challenge by researching American and policymaker attitudes around sports betting advertising and convening the sports betting ecosystem to ensure we continue to build a sustainable market. Luckily, we have more than 30 years of robust responsible gaming experience to rely on.
If the pandemic has taught us anything as an industry, it’s that when we are unified, we can solve any challenge. And that’s just what we’re doing.