PointsBet market share drops in key states amid US sports betting “arms race”
CEO Sam Swanell admits PointsBet has lost share of wallet to operators including BetMGM
PointsBet CEO Sam Swanell has railed against the marketing “arms race” engulfing the US sports betting market after the firm’s US market share dropped in all operational areas.
The Australian-headquartered operator’s US operations stuttered during its first financial results of the 2022 financial year, experiencing quarter on quarter drops in market share in many of its key US markets.
Declines in the company’s US market share caused an 18% share price drop in initial trading on the Australian Securities Exchange (ASX), losses which have continued into November.
Swanell contended this decline was due to the highly competitive US environment, with many operator’s Q3 marketing spend dwarfing the $21m PointsBet spent on US marketing in the same period.
Speaking during the ASX-listed operator’s latest results call, Swanell said: “We’ll spend an amount that we think is comfortable and can return a positive ROI.
“We will continue to assess the market and the opportunities, but we’ve got to focus on our product, our people and building the business for the long term. We’re not saying that we are not going to compete, because we obviously will.”
Swanell suggested the firm would still have a thriving business if overall US market share dropped to just 5%, admitting it would be “naïve” to think it had the same advantages and customer database as built up by the likes of BetMGM and FanDuel in the early days of the US market.
“We’ve been competing ever since we got into the US, but there’s no doubt that the level of promotions and marketing spend have had an influence on share of wallet being taken away from PointsBet and redirected to someone like BetMGM, which has benefitted from a sports betting perspective,” Swanell added.
One area where PointsBet is looking to recoup some of its lost US market share is through in-play player props and micro markets.
That upgrade would come via existing technology integrated from its Banach Technology acquisition, with NFL betting the first to benefit and NBA wagering set to follow.
“We continue to refine our approach as it relates to our client cohorts and seek to gain and improve share of wallet from them by leveraging both technical promotions and ongoing product enhancements,” said PointsBet US CEO Johnny Aitken.
“The positive of the high level of marketing and promotion seen in the US during the quarter means that US bettors are quickly becoming educated on sports betting.
“As bettors become more familiar with operating a betting account, the product experience will be the primary driver of long-term success and PointsBet has a feature-rich, reliable, and scalable product.
“In-play is the future of sports betting in the US, and you will not hear anyone say otherwise and NBC coverage and media assets is a great way to lean into that strategy” Aitken added.