Even though the heated battle between Proposition 26 and Proposition 27 is just getting underway in California, the sports betting industry is already planning ahead for the prospect of California sports betting. It’s more than just pouring money into the campaign spend too. Now is the time to start thinking ahead about how to capture a California audience, how to leverage databases, and how to acquire customers at a more reasonable rate than it cost operators in New York.
Content partners and companies within the gambling industry have been preparing for California for months and, in some cases, years. For Playmaker, a media and management company with a wide range of sports brands and influencers, growing a California base simply went hand-in-hand with growing broad, national communities on social.
Cultivating a Cali audience and keeping them engaged
“Honestly it’s kind of still the same because a lot of our platforms, Instagram, for instance, we have an even distribution down the middle of the states. We’re covering stories that appeal to people nationally. And yes, when we do have a partner that wants to hit Colorado a bit more, we do bring it into consideration and we’ll do more Colorado sports content, but usually its been sponsored by that sportsbook,” explained Playmaker President and CRO David Woodley.
Playmaker is also ensuring that Californians who cannot currently bet on sports legally are engaged despite being on the outside looking in. Woodley acknowledged it is about more than just getting the attention of Californians. The company needs to engage them and establish strong communication channels with them:
“We’re also like, okay what do we do with these California people? We know that it’s coming online, what is a way for us to build that value into the future so that when it goes live, we know we have that audience?”
One of the things we’re doing too is we have a bunch of free-to-play games that we build, we own all of it,” he said. “We’re getting this data for people so we know where they’re signing up…We have their email address, which is fine but then we also have their SMS number, which is great as well.”
Obtaining emails and phone numbers take the process of growing a California audience to the next level, where Playmaker and partners can directly reach out with offers and calls to action. And that work doesn’t start when or if Prop 27 passes, it begins now.
California sports betting market share a guessing game
The infancy of sports betting in the US naturally means the pecking order of today may not be the pecking order in five years. Regional brands are making substantial impacts in some state markets. With the massive size of California, Woodley observed most operators think they are in a great position, but he is less convinced.
“[Operators] all think they own California. If you’re a casino you know, if you’re one of the big casino properties, California has to come to our properties every week. They’re gonna bet with us. DraftKings and FanDuel will go, ‘we have all the DFS players to compete with us, right?’ And then you have all the other ones. California is a huge battleground state out there. So, you know, I think it’s too early to tell it there. I mean, will FanDuel crush? Probably because they crush everywhere else but where does everything else fall in line?”
A recurring theme at SBC Summit North America last month was the profound similarity across the apps. There are some differentiations across brands, but by and large, the tech looks and feels similar across the market. That leaves operator marketing teams to do the work of defining the brand and the offering.
After a tough and expensive launch in New York, where profitability is tough given the tax structure, sports betting apps are reconsidering their marketing approach altogether. Caesars, BetMGM, and others have publicly stated the desire to scale back spending and be more tactical with their acquisition efforts.
Sports betting apps paying more attention to lifetime value
These operators (save for Caesars) are spending big bucks on Prop 27. Will this level of spending continue if online sports betting comes to California with a much friendlier tax rate than New York?
Woodley thought operators are not just looking at spend, they are now focused on the quality of acquisition after bonus abuse impacted the bottom line in past state launches.
“I think they’re just they’re all getting much smarter because they know where they can bring on new bettors and they know where they can bring on I think, more importantly, bettors that have a higher average lifetime value versus just do the deposit here, go here, do a deposit here, go there,” he observed. “I think the worst thing in the world for a sportsbook is having someone that is signed up with six other sports books because then it’s like all of a sudden how are you gonna keep them? It’s a tough question. And that’s where they have to get super creative.”
Content and influencers can be a California betting difference maker
Creative thinking will be a core tactic to make an impact in California. Businesses like Playmaker will work with betting partners to deliver an audience eager to bet on sports. As scrutiny on acquisition spending increases, finding unique and dedicated audiences on smaller budgets will be an increasingly more common approach.
Finding betting influencers with meaningful followings is difficult. It is also tough to be an influencer in betting, period. Unlike video gamers who can utilize game play to generate engagement, influencers are limited in utilizing sports footage with leagues exercising copyrights on highlights. The industry is new and most winning bettors are not keen to post picks on social media. Instead, companies are looking to sports influencers more generally, like Pat McAfee.
“FanDuel placed a huge bet with Pat McAfee but it makes sense because it is bringing people in the door there and it is completely different from other people, especially as they can get him to activate around in-person events and things like that,” Woodley said.
Most of the major influencers have some sort of deal, so even someone with a small following with a concentrated audience in a place like California can be immensely valuable to a sportsbook. With the licensing requirements around affiliates though, it is difficult to do the affiliate deals that were so commonplace during the days of DFS and unregulated online poker in the US.
Where does that leave sports betting companies looking to expand their reach in California? It will come down to creative thinking about where to find audiences. Rather than tap the well of betting influencers dry, it will be about finding local personalities who can regularly create engaging betting and sports content. It will also begin now. Even though the election is still three months away, it is time to start making an impact in California through content and social media and mine that gold before the rush.
