A Sports Betting Boom
Technology has taken over yet another booming market: online sports betting. With the legalization of virtual casino experiences sweeping the U.S., will more problems arise than good?
Super Bowl LV was not only a huge win for Tampa Bay, but for the millions of Americans who bet on the Buccaneers’ success. All legal sports betting states have yet to report back, but as of now, Super Bowl LV bets have totaled $443.7 million, already far surpassing 2020’s total of $264.8 million. While the Super Bowl’s projected winner was the Kansas City Chiefs, lucky for the millions who bet on the underdog, the Tom Brady Effect prevailed. After watching this firsthand (and wishing I had bet too.. sigh), I wanted to know what this industry was all about.
Since I was completely clueless about sports betting when I started looking into it, I hadn’t even realized that it had just recently reached an all-time high since the start of 2021, and it’s no coincidence. Just last month, Michigan and Virginia launched online sports betting, taking the number of states with legal sports betting in action or underway up to 25, plus the District of Columbia. While experts predict that many more states will follow this trend in 2021, this seems to be spreading far beyond U.S. borders; Canada passed a single-game sports betting bill just this week, with their own companies (most namedly Score Media and Gaming and FansUnite Entertainment) anticipating the legalization. A few of the most well-known sports betting companies in the U.S. include DraftKings, FanDuel, and BetMGM, which are the three that are legal in the highest number of states. I’ve seen and heard of people using all of these companies’ apps and websites, but had read in several places that DraftKings was a fan favorite—so I opted to download their app and experience it for myself.
In-app and website marketing is efficient once you’re already in the system. But the precursors to this are becoming more copious than ever. On just a 20 minute drive yesterday, I spotted 2 DraftKings billboards advertising a first-time user deposit bonus of up to $1,000. The $1,000 is quite deceptive though, as the bonus amount is only equal to 20% of what you deposit (simply put, a $5,000 deposit is required to receive the $1,000 bonus.. hard pass). Nonetheless, such a large number is sure to get passerbyers starry eyed, or at least spark some initial curiosity. As stated by Chris Grove, a partner at Eilers & Krejcik Gaming, “Sports betting now is like water and finding its way into everything, especially now when operators are trying to attract new customers.” While DraftKings and FanDuel focused heavily on television advertising in past years with over $100 million spent per company in 2015, they’ve shifted their efforts to becoming more present on sports radio broadcasting and social media (if you haven’t seen at least one sports betting-related Instagram ad yet, you will soon).
Once you’re in the DraftKings app (or whichever you prefer, the promotions are super repetitive) you’ll know what I’m talking about when I say there’s free money everywhere. Upon making an account, there are pop-ups for free bets, deposit bonuses, and referral cash. The advertising is obviously meant to get dopamine flowing by overwhelming consumers with ways to begin (and continue) betting. Not only are the amount of promotions overwhelming, but the terms and overall app are too (especially for first-time betters). For newbies like myself, your bet slip records how much money you place on a bet, your potential payout, and the odds for those bets—it’s essentially a receipt of all your bets. Free bets are exactly what they sound like: a credit will be applied to your account, and if you win the bet you’ve placed with that wager, the earnings are yours to keep. DraftKings Refer-A-Friend Program is yet another tactic used to lure people in—if you can find a friend to download the app from your link and deposit $25, a $25 free bet is added to each of your accounts (and so the fun continues, just as these apps desire).
As I navigated through the app, I realized what a great job DraftKings did at making it feel like an actual casino experience with the ease of it being straight from a smartphone. Your balance is in the corner of the screen, all of the bets are organized by league and association, and there’s a convenient tab to make sure you don’t miss out on promos and bonuses. But with this growing market combining fun and the ease of use of gambling, negative consequences are bound to follow. James Grimes, a recovering gambler interviewed by DW News, called the rise of online sports betting during the coronavirus pandemic a “perfect storm” for gambling addicts. While some may casually participate in online betting, others may fall into the trap of online gambling being a quick way to earn (or lose) money—which could be exacerbated with such large amounts of people struggling financially during this time.
As the market has continued to grow, experts have become concerned that states are not taking the necessary measures to prepare for a rise in gambling-related issues. Research done by the National Council on Problem Gambling showed that nine states that recently legalized sports betting did not allocate new funding towards problem gambling services, although demand for them will most definitely be increased. Brianne Doura, a legislative director for the NCPG, told ESPN in a recent interview that, “It is [their] stance that stakeholders bear the responsibility to contribute to the research, prevention, treatment, and recovery of gambling addiction.” Companies profiting from online gambling should be held accountable for the issues that will arise because of it. With about 67% of all college students reporting sports betting activities, the numbers within such a technological generation are only bound to rise with the prevalence of online betting.
With over $20 billion bets since the Supreme Court legalization in 2018, online sports betting has become a huge moneymaker in the U.S. But with this new market targeting an array of audiences, from sports junkies who may have never bet before to experienced betters in search of a more convenient way to gamble, state legislature must be prepared for a surge of addiction and mental health issues that may be correlated with the rise in sports betting legalizations. Nonetheless, the industry has quickly permeated American culture. No one said it better than Mike Raffensberger, chief marketing officer at FanDuel himself: “Betting on games has become part of the sports ecosystem”-- and it will only continue to grow from here.
*If you or anyone you know struggles with gambling addiction, please don’t hesitate to call the National Problem Gambling Helpline at 1-800-522-4700.