Soo Kim, Chairman of Bally’s Corporation, has stated that operators entering the New York market must be ‘disciplined’ when it comes to an effective customer acquisition strategy.
Speaking at last week’s SBC Summit North America, Kim shared his insights into developments in the state of New York, which has awarded nine operators with licenses with a high-tax rate of 51%.
As one of the operators active in the state, the Bally’s Chairman was keen to share his perspective on the issue, as he underlined that due to it being a high tax jurisdiction the lifetime value of your customer is going to be lower.
“We’re very grateful to the governor and the state of New York for selecting Bally’s as one of the nine,” Kim explained.
“Obviously nine is not a lot of operators and the 51% tax rate is quite daunting, but I think if anything the opportunity that will come for all the operators will mean all the operators will have to be more disciplined and clever about how we acquire and retain customers.
“In a high-tax jurisdiction, you can’t get away with certain behavior, like over promotion and over advertising, because the lifetime value of your customer is going to be lower.”
Identifying the high tax rate as one of the most significant challenges facing operators in New York, Kim further argued that the state will be one of the most expensive with regards to media whilst also posing geographical difficulties.
He added: “You layer on the fact that it’s also surrounded by states that all have legalized gaming including Connecticut, Pennsylvania, and New Jersey. Most of the population of New York lives close to the border of another state where it isn’t a differentiating experience and it’s possible for those customers to go over.
“The whole point of this exercise is for the state and the operators in the state to keep those revenues in New York, and I think that is going to be the greatest challenge.”
Bally’s is one of the largest operators across the US, having established a network of 16 land-based casinos across 11 states – making it the third-largest casino operator in the country – as well as securing online access in four jurisdictions, including New York where it exclusively operates online.
“That’s going to expand,” Kim remarked, concerning Bally’s online ambitions. “There’s going to be plenty of states that have online offerings where there are either no casinos to get or we simply do not have one.
“New York is one of those states where there are some casinos but the online skins are untethered. We believe in the national gaming business, we want Bally’s to really be an international gaming company and we need to be everywhere we can be.”
Taking place at the Meadowlands Exposition Centre in New Jersey between November 30 and December 2, the SBC Summit North America featured a range of panel sessions and keynote speeches addressing several topics across the US sports betting and gaming industry.
Interviews from the SBC Summit North America and past events can be viewed on the Sports Betting Community YouTube Channel by clicking here.