US Sports Betting Update – Arizona sportsbooks enjoy record month
Arizona sportsbooks shattered a state record by handling $691 million during March. The Arizona Wildcats powered through to the Sweet 16 of the NCAA Tournament and the Phoenix Suns ended the season with a flourish, driving the strong performance. Sportsbooks easily broke the previous record of $563.7 million, which was set in January. The handle represented a 40% month-on-month increase compared to February.
Operators held 5.6% of the wagers they handled, resulting in gross sports betting revenue of $38.9 million. That earned the state $1.7 million in tax revenue after deductions. “March was an exciting month for Arizona event wagering, with major sporting events like NCAA’s March Madness helping set a single month event wagering handle record,” said Ted Vogt, director of the Arizona Gaming Department. “I look forward to seeing how the industry continues to develop as we finish out the first year of legal event wagering in the coming months.”
Arizona releases its figures later than most other states, but the figures show that it is now one of the country’s largest jurisdictions for sports betting. FanDuel has emerged as the market leader in most states, but rival DraftKings has held onto the lead in the Copper State. It handled $230.2 million in March, giving it a 33.3% market share. That left it ahead of FanDuel ($187.4 million), BetMGM ($133.7 million) and Caesars Sportsbook ($95.8 million).
However, DraftKings struggles to turn its handle into revenue. It held just 3.1% of the bets it took, leaving it with revenue of $7.2 million. That left it behind FanDuel, which held 7.2% for a market leading $13.4 million in revenue, and BetMGM, which held 8% for $10.7 million in revenue. DraftKings, FanDuel, BetMGM and Caesars account for 93.6% of the market, leaving the remaining operators – Barstool, WynnBET, BetRivers, Betfred, SuperBook, TwinSpires, Desert Diamond, Fubo, Unibet, Hard Rock, Betway, Sahara Bets and Golden Nugget – to fight for scraps.
DraftKings Founder Insists Hold Will Increase in Time
Jason Robins, the co-founder and chief executive of DraftKings, has insisted that it has no plans on becoming a low-margin sportsbook. He was speaking at a travel and leisure conference hosted by Goldman Sachs this week, and he said operators will enjoy a higher hold over time. “As the market matures, the win rate should go up,” said Robins. “In an earlier stage environment, it is not the worst thing in the world to give people a couple of extra winning experiences, rather than trying to maximize how much margin we’re taking. So it’s an area of focus. But very deliberately. We’re not looking to take money from people by forcing them into bets they don’t want.”
One area of focus is a bid to eliminate sharp bettors – professionals that hunt out the best odds and bounce on discrepancies in the lines published by rival operators – and there is also a push to increase the number of parlays placed on the site. “We’re trying to get smart in eliminating the sharp action or limiting it at least,” said Robins. “Then trying to make sure we have a high parlay mix because people do like that.” DraftKings migrated from a white-label platform provided by Kambi to an SBTech platform after it purchased SBTech in 2020. “That is something we’ve been focusing on a lot since we migrated,” added Robins. “It’s only been eight or nine months, but the parlay percentage of bet mix goes up each month.”
theScore Bet to Leave the US Market
theScore Bet is the latest casualty of the fierce competition that has proved so challenging for smaller sportsbooks in the United States. TwinSpires has already announced plans to get out of the sports betting game, meaning it will focus solely on horse racing in future. Now theScore Bet has also fallen by the wayside.
This mobile sportsbook launched in 2019. Its point of difference is that it links the regular media app – which provides sports news, analysis and stats – with the sports betting app, creating a holistic experience for customers. It is available in New Jersey, Colorado, Indiana and Iowa. The sportsbook has struggled to compete with established rivals like FanDuel, DraftKings, BetMGM and Caesars. Penn National Gaming, which purchased theScore Bet app and theScore media app for $2 billion in 2021, is now pulling the plug. It will discontinue US sports wagering on July 1.
Penn National runs the Barstool Sportsbook, so that will be its focus in the US market, while theScore Bet will be for Canada only. The brand is based in Toronto, and it has proved popular during the opening weeks of Ontario’s new legal sports betting industry. theScore Bet accounts for 50% of all downloads since legalization on April 4, followed by Bet365 (36%), Betway (5%), BetMGM (3%) and BetRivers (3%). In Penn National’s latest earnings call, it claimed that 79% of Ontario bettors use theScore media app, giving it a large addressable market.
Integrating theScore Media App with Barstool
“This move enables us to maximize the value of both brands through our organic media and gaming approach,” Benjie Levy, president and COO of theScore, told Sports Handle. “Key to our strategy is integrating theScore media app with Barstool Sportsbook, which we’re currently working towards. Bringing together theScore’s powerful mobile sports media platform with Barstool Sportsbook in a unified ecosystem, supported by our in-house technology and custom integrations, will strengthen the overall U.S. product offering and broaden its reach.”
Barstool currently runs on the Kambi white-label platform, so it has to pay a chunk of its revenue to the Swedish company. However, it plans to switch Barstool to the proprietary technology and risk platform that theScore created. That migration will occur during the third quarter of 2023. “As we approach a major undertaking this summer with the launch of our proprietary risk and trading service, the timing is right to focus our U.S. efforts on marketing Barstool Sportsbook and our Canadian efforts on marketing theScore Bet,” said Levy.