Opinion: US Sportsbooks Must Be Wary of Encroaching on Sports – A Warning From Across the Pond

  • US sportsbooks are competing for exposure by signing numerous deals with sports franchises 
  • This is the same tactic used in the UK, where most Premier League teams have betting deals
  • The strategy has caused issues across the Atlantic, with a potential ban on front-of-shirt sponsors
  • US sportsbooks must use a tactile approach and work together so they don’t follow the same path
DraftKings signage
The US has seen a flurry of sportsbook partnerships with sports teams over the past year as gambling companies fight for brand exposure, but operators should take heed of the UK market where over-sponsorship has led to government intervention.

A growing number of deals

US sports betting partnerships are now a regular feature in the world of gambling news, and rightfully so. As more and more states begin to see the value of legal wagering, sportsbooks are seeking brand exposure the best way they know how – by forming sponsorship deals with sports teams, stadiums, leagues, one-off events, and even athletes.

Betway publicized one such partnership with the NHL’s Philadelphia Flyers on Wednesday this week:

The benefits of these agreements are evident, and gambling industry journalists are more than accustomed to the usual suspects in company press releases. If we were to play partnership announcement bingo, phrases such as ‘in-stadium signage,’ ‘boosting fan engagement,’ and ‘use of official marks and content’ would undoubtedly crop up more than any others.

To help in their fight for market share, it is clear that US sportsbooks such as Betway have set their sights on securing as many of these partnerships as possible. However, they might want to take a breath, step back, and look at the issues facing a more mature market lying almost 7,000km away in the UK.

Similar strategies across the Atlantic

Like the US, the UK is a nation of sports lovers. Each weekend, its stadiums are full to the brim with soccer, rugby, and cricket fans hoping their team can secure a win. In another similarity to the US, sportsbooks across the Atlantic have decided to take advantage of this as much as possible by forming sponsorship agreements.

45% of teams have front-of-shirt sponsorship deals

In the English Premier League, for example, the country’s most popular competition, 45% of teams have front-of-shirt sponsorship deals with betting companies this season. This includes Leeds United, Watford, Brentford, Newcastle United, and West Ham United. Meanwhile, all but one of the league’s 20 teams have a betting deal in some form or another.

The beginnings of this level of betting sponsorship are already evident in the US. The nation’s most popular league, the NFL, has fully embraced the sports betting industry, authorizing multiple official sportsbook partners including Caesars Entertainment, DraftKings, and FanDuel. The league has also allowed six sportsbook commercials to air per game this season.

Earlier this week, Caesars Sportsbook secured the Manning family as ambassadors, with Eli Manning breaking the news via a video on Twitter:

Of course, these partnerships are not just limited to American football. At the end of October, Betway secured its third NBA agreement in just one week, adding to a long list of betting partnerships for the league’s teams. Similarly, the NHL and its teams have committed to a number of deals with sportsbooks, as have the MLB, NASCAR, and MLS.

So, what’s the issue?

The problem with this level of encroachment lies in its reception from gambling’s opponents. In the UK, the industry’s critics have repeatedly taken aim at the amount of betting sponsorship in sport – so much so that sportsbooks voluntarily agreed to a ‘whistle to whistle’ ban on advertising during sporting events in 2018.

Members of the Betting and Gaming Council (BGC), which includes Bet365, Ladbrokes, and Paddy Power, agreed to stop all TV advertising between the first and final whistle of any sporting event in the UK. A report from last year deemed the measure a “success,” claiming it slashed the amount of TV gambling ads seen by children by 97%.

Now, according to a September report from Sportsmail, MPs intend to take this one step further by introducing a ban on front-of-shirt sponsorships in soccer. The move will form part of the UK government’s review of the Gambling Act 2005, with plans for the publishing of the proposal by the end of this year or early 2022.

Not only will this impact sportsbooks, but soccer league executives have also warned of the potentially damaging impact on their own revenue. Rick Parry, chairman of the English Football League, has claimed that a ban would prove “catastrophic,” with more than £40m ($53.6m) of annual revenue at stake for the 72 clubs in the league.

Undoubtedly, US operators should take heed of these events when forming their own marketing strategies.

A more gradual approach

Comparatively, the North American sports betting industry is much younger than its counterpart across the Atlantic, but it already represents one of the largest markets in the world and is still growing at a staggering rate. To ensure that growth continues, its sportsbooks have a responsibility to remain on the right side of popular opinion.

how long until the novelty wears off?

For now, US citizens are still adjusting to betting’s involvement in their favorite sports, but how long until the novelty wears off? How much time before gambling opponents get tired of viewing DraftKings TV ads every time they watch a football game? How long until NBA fans are sick of FanDuel signage lining the court of their favorite team?

Over the past year, US sportsbooks have competed with each other to secure these deals. However, it is these firms that must work together to ensure they can continue to promote themselves without limits. Bodies such as the American Gaming Association provide a great opportunity for them to do just that, much like the BGC has in the UK.

The UK industry was once in a very similar position to the US, and now its sportsbooks face losing their sponsorship rights altogether. America might be known for its gung-ho attitude, but perhaps a more gradual approach could ensure the market doesn’t follow the same route.