The sports betting and gaming industry in the United States is undergoing a significant transformation. This change is largely driven by the increasing number of states legalizing and regulating sports betting. It’s a fascinating shift, considering that not too long ago, sports betting was confined to a few states, with Nevada being the most prominent.
As more states join the fray, the market dynamics are evolving rapidly. This expansion is not just about the legal landscape changing but also about how companies in this space are adapting and innovating to capture market share in a highly competitive environment.
In pursuit of valuable insights and a deeper understanding of the US Sports Betting and iGaming market, Robbie Sexton, Director of Partnerships & Sports Betting & Gaming at Xtremepush, sat down for an interview with Oren Langburt, VP of Marketing at InclineBet.
In this conversation, Oren answers 16 key questions about the current state of the US SBG industry. He shares his expertise on marketing strategies, the dynamics, and the influence of major operators.
Learn more about the rapidly changing US landscape in our interview.
1. Can you give us an overview of InclineBet; the services you deliver, and what you do in the company?
OL – InclineBet provides performance-driven digital marketing services to North American iGaming operators. Our partners include the likes of FanDuel, Delaware North, and Four Winds. We’re focused on digital marketing activities that deliver clear ROI. We acquire high-value casino and sports betting players for our partners and maximize LTV. We also have a dedicated creative team who focus on industry creatives and have a library of more than 4,000 casino digital ads covering all of the major regulated slot providers.
2. The US market has initially seen high CPA and changing LTVs – maybe not as significant as initially expected. While this seems to have settled down somewhat recently. Can you give us an overview on the current state of the market and your thoughts on how it is today from a marketing perspective?
OL – The current monthly levels of online casino ARPUs that we see are not only the highest in the world, but also significantly higher than the early projections.
For sports, gross ARPUs are broadly in line with the plans we saw before launch, but where these have been depressed is because of bonus management – and in many cases, poor bonus management by operators who were keen to post higher gross revenues (while disregarding the net ARPUs)
TV is good for brand awareness on a large scale but may not be as effective in driving direct conversions. Digital channels excel in targeting capabilities. They allow for precise targeting based on demographics, behaviors, and interests. This leads to better conversion rates and a higher ROI. Digital platforms also provide robust analytics and measurement tools to evaluate the effectiveness of ad campaigns in real time. This allows for optimization and better allocation of ad spend, whereas TV can be more challenging. Digital advertising is also more cost-effective, especially for smaller operators. It allows for budget control and the ability to pause or adjust campaigns quickly based on performance.
One channel that bridges the gap between digital and traditional TV advertising is Connected TV. CTV offers the best of both worlds to some extent. It provides the broad reach and big-screen visibility of traditional TV while incorporating the targeting and measurement of digital advertising.
3. With three brands essentially controlling 90% of the sports betting market and 60% of the casino market, what are your thoughts on how the market is evolving? Also with Bet365, ESPN and Fanatics entering the market – how do you think this may affect the current status quo?
OL – Smaller operators are facing challenges when attempting to compete with the larger players in sports. Even with a modest market share, though, profitability is attainable in both casinos and sports through disciplined marketing strategies and a sharp focus on ROI.
There’s no denying that Bet365, ESPN and Fanatics each bring something to the table, whether that’s a tremendous product offering, brand recognition or a vast database. However, now they have to battle it out with the likes of FanDuel and DraftKings who already possess all three of those strengths.
Although it is challenging to steal market share from dominant operators in a state that is already online, a new market is likely to exhibit a slightly more distributed share among operators.
4. From an acquisition perspective, can you talk us through where InclineBet is focusing on driving traffic and players. How differently do you treat casinos to sports?
OL – We’re predominantly focused on casino; slot-players specifically. We handle casino and sports separately because the core players for each are a different demographic. This has been a large part of our success so far. We’ve also maintained a sharp focus on mobile app acquisition. This is challenging for an industry that has traditionally been web-focused.
5. Branding, or performance marketing? Would you prioritize one over the other, particularly for new brands? When is branding important, and what performance marketing do you see as effective?
OL – We don’t do any brand marketing. We are strictly performance-driven. Even our creativity is driven by performance. We always say we don’t judge creativity by how it looks, only by how it performs in the market. To no surprise, our most successful channel to date has been Facebook/Meta. From our perspective, if you do performance marketing well, you will naturally gain a brand advantage, but if you only do brand well, you won’t get the performance. This is something we talk to Facebook about in great detail; How we can leverage reach with performance-based campaigns.
Many of our casino clients are seeing a gross positive payback on a per player basis within 6 weeks. sports is more challenging, however, if you’re focused on CRM and ensuring players aren’t coming in just for your welcome offer, then the LTV is there. The adoption of higher margin products like SGP’s certainly helps as well.
6. US operators were aggressive with welcome bonuses in addition to high player costs, leading to advantage play/bonus abuse. What is the current level of play for bonusing?
OL – Thankfully, things have calmed down in that regard over the last 6-12 months. Of course, there are still periods in the sporting calendar where we’ll see operators get extremely aggressive again but overall, there has been a welcomed pullback.
7. How does Incline manage the budget, including the bonus budget, or do operators dictate this?
OL – Our partners hire us for our expertise, and the budget plays an integral part of our overall strategy. This is where being ROI-focused is essential.
A typical agency that gets paid on commission will generally want their client to spend as much as possible. We take a different approach and will often pull back when we feel conditions in the market aren’t optimal.
From a bonusing and CRM perspective, we don’t try to match the welcome offers of the big guys. For one, it attracts the wrong kinds of players. We focus the majority of our budget on targeted lifecycle offers.
8. Player Retention and CRM are coming more into focus as operators are driving more to profitability and delivering LTV and moving away from the initial acquisition land grab approach. Could you talk to us about some key elements of a good CRM strategy in the US you are seeing that drive success?
OL – Different players have different needs and preferences. Segmenting players based on their behavior and preferences is key. Offering a personalized gaming experience through tailored recommendations, personalized promotions, and custom profiles can significantly enhance player retention. Having a solid CDP partner like Xtremepush is a crucial weapon in any martech stack. We still hear stories of some operators using only a handful of segments to market to their player base. On any given day, we have 100+ lifecycle campaigns going out.
9. We definitely see that a pain point in the industry is fragmented data and not having an end-to-end player view from acquisition through to retention. You work with a lot of clients/different platforms. What is your experience of this, and what is InclineBet’s approach to this?
OL – Fragmented data is indeed a significant challenge in the industry. The lack of a holistic view of player interactions hurts an operator’s ability to effectively market to players. Luckily many of us on the team have been doing this for a very long time. When we don’t have the data we need, we lean on our past experiences.
10. How mature do you think the SBG industry is in the US, particularly in personalizing the player experience?
OL – I think we still have a long way to go. As we have already mentioned, data is still fragmented, real-time data is rare, and integrations on white-label PAM solutions are often limited. Operations can sometimes be incredibly manual, limiting the scale and scope of marketing capabilities. CRM platforms like Xtremepush are able to support it all, but the PAMs are often the ones holding everything back.
The right martech stack is crucial to success. You can have the greatest marketing ideas and staff in the world, but if you don’t have the technology to operate them, they aren’t worth much. We spend a significant amount of time and effort working with our partners and their providers, ensuring they have the best martech stack possible.
11. What are your thoughts on how the US is currently approaching Responsible Gaming and how will it evolve over the coming years?
OL – One of our clients is FanDuel, and I can tell you they are fully committed to RG. Not just from a customer-facing perspective but as an organization. As a leader in the industry, they know they need to be at the forefront of this topic, setting the example. With the continuous expansion of iGaming, it’s just a matter of time until regulators will further enforce responsible gaming regulations like we currently see in the UK and other countries.
12. How do you see Al shaping the future of player marketing, particularly with acquisition and CRM teams?
OL- AI can help in understanding player behavior patterns such as likelihood to churn, early VIP detection, LTV prediction, and so much more. Armed with this info, it helps shape marketing strategies and can lead to significant cost efficiencies.
13. In the US, F2P historically has been seen as a powerful acquisition tool, whereas in Europe, it now sits very firmly with player retention and CRM teams. What are your thoughts on F2P as a retention tool?
OL – We’ve talked about the importance of differentiation and engagement in a competitive industry like iGaming, and I believe F2P games help with both. F2P games can keep players engaged with the platform even when they’re not willing to spend money. Incorporating F2P games within loyalty programs can also encourage continuous engagement, where players can earn loyalty points or other rewards.
14. In-house or 3rd party providers always seem to be a big topic. What are the pros and cons?
OL – It depends on the circumstances, but if you’re a smaller operator, third-party providers offer several advantages. Firstly, it allows for a quicker speed-to-market due to ready-made solutions, which is critical in this rapidly evolving industry. Secondly, it brings specialized expertise and established solutions that can significantly reduce the operational burden on the operators. This allows operators to remain focused on core business activities while leveraging external expertise to enhance their offerings and stay competitive.
15. ‘Omnichannel’ is a bit of a buzzword but a very important element in the US due to the popularity of land-based casinos. Is the land-based online journey seamless, or is there still a long way to go? Any land-based operators who are doing this well, in your opinion?
OL – The journey towards a seamless transition between land-based and online casinos is underway with notable strides. MGM and Caesars have a rich loyalty program history and lead the way, particularly with how they leverage their rewards programs. MGM/BetMGM have also introduced a custom omni-channel slot game ‘MGM Riches’ that can be played both online and at MGM properties. There are payment solutions working on combining casino and online wagering accounts, along with casino loyalty programs, into a single digital payment wallet, enhancing the ease of transitioning between land-based and online. So progress is being made, but there is still quite a bit of room for further integration and improvement.
16. What tips would you have for any operators entering the US?
OL – for any operators with their eyes set on the US market, I would advise the following as the right steps to achieving success:
- Become laser-focused on ROI.
- Manage Bonus & Promotions spend like it is your own, real money (not fake bonus funds).
- Get the martech that makes the most sense for your business objectives. It’ll be crucial for your success.
- Leverage AI where possible.
- Contact InclineBet to ensure the correct entrance into the US market.
Final Takeaways:
Oren Langburt’s insights shed light on the dynamic landscape of the US Sports Betting and iGaming industry. Here are the key takeaways that you should keep in mind from the conversation:
Market Evolution: The US market has seen shifts in CPA and LTV dynamics, with a notable focus on disciplined marketing strategies and ROI.
Marketing Channels: Digital channels, such as Facebook and Google, excel in precise targeting, offering better conversion rates and ROI, while Connected TV bridges the gap between traditional TV and digital advertising.
Market Competition: With the entry of new major players like Bet365, ESPN, and Fanatics, competition intensifies, and the market may see a more distributed share among operators.
Player Segmentation: Effective marketing strategies involve segmenting players based on behavior and preferences, offering personalized experiences, and deploying robust Customer Data Platforms.
Technology and Martech: The industry has room to mature in terms of personalizing the player experience and integrating fragmented data, while a strong Martech stack is crucial for success.
Responsible Gaming: Operators are increasingly committed to responsible gaming, with a trend toward stricter regulations on par with international standards.
AI’s Role: AI plays a huge role in understanding player behavior, shaping marketing strategies, and achieving cost efficiencies.
F2P Games: Free-to-play games serve as powerful acquisition and retention tools, enhancing player engagement and loyalty.
In-House vs. Third-Party: The choice between in-house and third-party providers depends on circumstances, with third-party providers offering speed to market and specialized expertise advantages.
Omnichannel Integration: Progress is being made in creating a seamless transition between land-based and online casinos, with loyalty programs and digital payment wallets contributing to the journey’s success.
More states are expected to legalize sports betting and casino operations, influenced by the potential of revenue generation. For operators entering the US market, key tips include focusing on ROI, managing bonus and promotions spend wisely, leveraging martech, incorporating AI, and considering partnerships with industry experts like InclineBet.
The future of the US Sports Betting and iGaming industry promises further growth, innovation, and regulatory developments, making it a dynamic and exciting landscape to navigate.