{"id":4166,"date":"2022-02-03T11:47:21","date_gmt":"2022-02-03T19:47:21","guid":{"rendered":"https:\/\/wagers.com\/staging\/4285\/?p=4166"},"modified":"2022-02-04T04:22:08","modified_gmt":"2022-02-04T12:22:08","slug":"canada-sports-betting-webcast-provides-contrasting-perspectives-on-b2b-and-b2c-strategies","status":"publish","type":"post","link":"https:\/\/wagers.com\/staging\/4285\/news\/canada-sports-betting-webcast-provides-contrasting-perspectives-on-b2b-and-b2c-strategies\/","title":{"rendered":"Canada sports betting webcast provides contrasting perspectives on B2B and B2C strategies"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">The webinar hosted by the Canadian financial services firm TMX on the prospects for regulated sports betting in the US and Ontario highlighted key differences in perspectives between B2B and B2C firms in the space.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The panelists were all optimistic about their prospects and this would not have come as a surprise, TMX is linked to the Toronto Stock Exchange, the companies are all listed on the TSX and their comments were aimed at investors and fund managers. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Jordan Gnat, CEO of sports media and betting content provider Playmaker, said the combination of sports and betting content was a potent mix in driving wagering volumes, but also all ancillary activities around sport such as merchandising and media consumption.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Joe Levy, CEO and founder of Simplebet, a specialist provider of live micro-betting markets to sportsbooks, said that prior to 2018 and the repeal of PASPA, which has led to the current wave of North American betting regulations, &#8220;the technical infrastructure for micro-betting didn&#8217;t really exist, because globally soccer was the main sport for betting, it\u2019s as very fluid game\u201d and doesn\u2019t provide many opportunities to develop micro-betting options that are more suited to the stop-and-start nature of NFL or MLB games.\u00a0<\/span><\/p>\n<p style=\"text-align: center;\">&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;<\/p>\n<p><b>Ontario quick facts<\/b><\/p>\n<ul>\n<li><em><span style=\"font-weight: 400;\">Ontario is expected to rank among the top five North American jurisdictions for OSB.<\/span><\/em><\/li>\n<li><em><span style=\"font-weight: 400;\">Eilers &amp; Krejcik have forecast revenues of CA$572m in 2022, rising to CA$904m by 2026 and the province to account for half of Canada\u2019s CA$1.8bn revenues by 2026.<\/span><\/em><\/li>\n<li><em><span style=\"font-weight: 400;\">Go-live date for regulated sports betting: 4 April.\u00a0<\/span><\/em><\/li>\n<\/ul>\n<p style=\"text-align: center;\">&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;<\/p>\n<p><span style=\"font-weight: 400;\">Ken Hershman, CEO and founder of sports data firm Champion Gaming, said the fact that just 40% of the US population had access to regulated sports betting was another sign of the potential of the industry, although \u201cone of the challenges is on the content side, we have to find a way to reach customers and not get lost in the generic noise,\u201d he pointed out.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/span><\/p>\n<h3><b>Critical Salz\u00a0\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">However, amid all the positive talk there were also critical words from the only B2C firm taking part in the discussion. Steven Salz, CEO and founder of esports-focused online sportsbook Rivalry, was outspoken in his description of the major US books, notably DraftKings. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">His key assertion was that the Boston-headquartered operator (and other major brands more generally) used promotions and bonuses to drive player acquisition, with little effort made on product and innovation.\u00a0\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">He said product and branding commoditisation and huge marketing budgets meant that startups such as Rivalry \u201ccan\u2019t ever win on balance sheet (size of their marketing budgets), so we deliver on product and innovation and having a standout brand\u201d.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Salz added that \u201cpeople can debate Barstool\u2019s performance, but there is something to be said about owning your customers vs. renting them, which is what you do when you give them bonuses and free bets, they\u2019re completely transient. You have no ownership over that customer and you\u2019re just trying to grab a last bit of LTV before somebody else owns them.\u201d\u00a0<\/span><\/p>\n<blockquote><p><em><span style=\"font-weight: 400;\">The Rivalry CEO pointed out that when the \u201cmassive compression on share prices happened at the end of last year, sports betting came off as one of the worst performing sectors because people realised that DraftKings is losing half a billion a year and spend more on marketing in two days than we spend in a year; and that when your balance sheet is your only competitive advantage then it\u2019s a just a race to the bottom.\u201d<\/span><\/em><\/p><\/blockquote>\n<p><span style=\"font-weight: 400;\">Salz\u2019s comments should be taken with a hefty pinch of salt (sorry). Rivalry is not licensed in the US and focuses on a very niche betting vertical which it uses to drive its players towards \u2018traditional\u2019 sports betting products such as NFL, soccer or tennis. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">What they do illustrate however is that small operators like Rivalry have to account for every detail of their offering, cost and how ROI is generated on every outlay. The implication being that DraftKings doesn\u2019t have such worries, but if it did, it might make better use of its marketing budgets.\u00a0\u00a0<\/span><\/p>\n<h3>B2C coal face<\/h3>\n<p><span style=\"font-weight: 400;\">In terms of audience, Salz added that \u201c98-99% of our customers are under 30\u201d and his group targets them with content-heavy campaigns and products that are all developed in-house. &#8220;We are focused on great entertainment and products for younger demographics, that\u2019s how start ups win,&#8221; he said. <\/span><span style=\"font-weight: 400;\">One assumes that Rivalry&#8217;s aim is to retain these players and increase their loyalty levels for as long as possible as the players set out on their sports betting journeys. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">DraftKings would of course dispute all this and point to its <\/span><a href=\"https:\/\/wagersearningsmore.substack.com\/p\/5-nov-draftkings-hit-by-nfl-results\"><span style=\"font-weight: 400;\">data-led marketing strategies<\/span><\/a><span style=\"font-weight: 400;\">, cohort studies and in-house tech platform as key levers that it can pull to manage costs and drive revenues. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">But in fairness to Salz, his assertions about DKNG numbers are not wrong and while the company does indeed have <\/span><a href=\"https:\/\/wagersearningsmore.substack.com\/p\/jan-27-lvs-plays-a-waiting-game-on\"><span style=\"font-weight: 400;\">scale<\/span><\/a><span style=\"font-weight: 400;\">, its results suggest that it is not producing similar margins to those of FanDuel or BetMGM, especially on key products such as parlays, and is also spending more on promotions as a percentage of GGR to drive wagering volumes.\u00a0\u00a0<\/span><\/p>\n<p>Still, there was a somewhat stunned silence from the other panelists after Salz made his comments, possibly because the issues he raised are widely discussed in industry circles, but seldom on the record. They also illustrate the different perspectives between B2B and consumer-facing companies in the space.<\/p>\n<p>Indeed, that final point has been made explicit by groups such as Wynnbet pulling the plug on its OSB plans and Las Vegas Sands saying it will only enter the online gambling space via B2B M&amp;A because of the &#8220;unsustainable&#8221; costs associated with acquiring US sports bettors.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The webinar hosted by the Canadian financial services firm TMX on the prospects for regulated sports betting in the US and Ontario highlighted key differences in perspectives between B2B and B2C firms in the space. The panelists were all optimistic about their prospects and this would not have come as a surprise, TMX is linked [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","footnotes":""},"categories":[324],"tags":[939,947,590,612,946,783,662,19],"class_list":["post-4166","post","type-post","status-publish","format-standard","hentry","category-news","tag-betmgm","tag-champion-gaming","tag-draftkings","tag-las-vegas-sands","tag-ontario","tag-rivalry","tag-simplebet","tag-wynnbet"],"_links":{"self":[{"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/posts\/4166","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/comments?post=4166"}],"version-history":[{"count":15,"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/posts\/4166\/revisions"}],"predecessor-version":[{"id":4217,"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/posts\/4166\/revisions\/4217"}],"wp:attachment":[{"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/media?parent=4166"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/categories?post=4166"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/wagers.com\/staging\/4285\/wp-json\/wp\/v2\/tags?post=4166"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}