Speaking to SBCnews, the Co-founder and CEO of Chalkline Sports, Daniel Kustelski detailed why Basketball could become the key product for operators looking to unlock the promise of the US market.
In an insightful interview with SBCnews he also highlighted key data from Nevada as an endorsement for the value of the NBA as a betting product.
SBC: As the US sports betting market expands, how much potential does the NBA have to grow as a betting product?
Daniel Kustelski: The NBA has significant upside as a betting product, probably more than any US sport. To be clear, football is the current King of US Sports betting, but basketball has a larger potential growth opportunity.
The facts, courtesy of the Nevada Gaming Board: In 2017, basketball had the second-highest handle, by sport, after football.
In 2017, basketball had the highest Net Revenue, by sport, for the 1st time since 2011 Betting handle on basketball in the US has increased 41% over the past 5 years. By comparison, the NFL has only increased 8% over the same time period.
Basketball is simply a great betting sport: lots of games played every day, In-Play wagering for basketball is terrific (and growing) and the sports is fast-paced enough for the next generation of sports bettors.
“One more factor to consider: the NBA has been the most forward-looking of all the US sports leagues when it comes to betting. That bodes well for the sport as a betting product.”
SBC: Does the fast-paced nature of NBA make it a more attractive live betting product compared to the NFL?
DK: Absolutely. The dynamic end-to-end nature of the game naturally encourages more odds volatility, which gives customers more opportunities to express their opinions in a bet.
There’s a huge education opportunity for US bettors when it comes to In-Play betting. That said, it’s inevitable that once the US is regulated the US will catch up with the rest of the world in live betting, which currently stands at about 70% of all bets placed in regulated markets.
With 82 games per season, and a healthy number of playoff games, bettors have ample opportunities to learn about In-Play betting, and also have a growing body of statistical data sources to support their betting decisions.
SBC: If the US sport betting market opens up, how important will it be that Betting operators in the US launch products that have a broad appeal, attracting both casino and sportsbook players?
DK: This is going to be critically important. In the US, operators will serve themselves well by starting simply, and simply starting.
The American Gaming Association estimates that post-regulation, the US will have a market size of nearly 50M bettors. The vast majority of these bettors will be recreational players, and will need simple products. Many of those players are already on casino loyalty programs, so that’s a very sensible place for operators to starting building audience.
In South Africa, I led the integration of our online sports book into a land-based casino. The loyalty program integration was a key factor in immediately increasingly the value of all players.
The US operators that keep it simple, focus on mobile, start with cross-promotion and make sports betting products accessible to a wide audience will certainly build significant market share quickly.
“The end goal must be to ensure that operators and players both have access to safe, secure and responsible products and services”
SBC: Do you anticipate that if sports betting is legislated in the US, operators will utilise the framework currently set in Nevada, or will they adopt a European approach?
DK: It’s certainly an interesting question. As a past operator in the US and Africa, I hope states will adopt a progressive approach to a regulatory framework. The end goal, of course, must be to ensure that operators and players both have access to safe, secure and responsible products and services.
Certainly, the Nevada framework has solid foundational components, a sensible tax structure and a history of success. But, Nevada is more stringent than other jurisdictions regarding online/mobile betting platforms.
In my experience, US states rolling out regulated sports betting will be wise to look at all models of taxes, licensing, software requirements, KYC and responsible gaming when building their framework. US regulators have a unique opportunity over the coming years to get this right.
SBC: What can sportsbook suppliers do to endear themselves to US sportsbooks looking to build a footprint around potential new sports betting customers?
DK: Suppliers that focus on integration and collaboration will win, in terms of establishing relationships and building market share.
It appears likely that sports betting licenses will be awarded to established gaming operators: Casinos, Tracks and Lotteries. Sports betting will be one product in a suite of gambling entertainment offered by brands, so it’s important for suppliers to understand how the evolving ecosystem works, and where they can add value.