PointsBet in the US Market – Astonishing Performance from the iGaming Operator
It was 1849, and gold had just been discovered in a small pocket of west coast California, leading to what later became known as the 'US Gold Rush.' A key turning point in the country's history, it also prompted mass migration from around the world, as numerous people and even enterprises sought to capitalize on the endless opportunities that awaited.
Fast forward more than 150 years later; history appears to be repeating itself following the emergence of an industry in the face of USA online casinos that is already seemingly worth a small fortune. It is perhaps somewhat ironic that around the same time, migrants brought with them an activity that has since grown into an industry that is one of the biggest in the world.
While Las Vegas and Atlantic City have for decades been considered the birthplaces of gambling in the US, for years, state legislatures prohibited the one activity that, in Europe at least, was transitioning into an industry with a market capitalization worth deca-billion.
Today, US society is a lot more welcoming to foreigners compared to at the time of the Gold Rush, with many Americans being aggressively protective of their new discovery. Certainly, the business has become a lot more sophisticated, even as recently as early Las Vegas, which formerly and infamously had mob affiliation.
The dawning of a new era came in 2020, following an unprecedented global pandemic that led to states across the US realizing that approving online gambling and/or online sports betting could significantly help to make up a shortfall in the economy.
Bills were proposed and approved in a number of states, all seeking to capitalize in an industry that only New Jersey, Pennsylvania, and Las Vegas were profiting from the increased popularity of iGaming, via taxation to gambling companies.
Already blazing a trail in these states were market locals, DraftKings, Flutter Entertainment-owned, FanDuel, and BetMGM, the online joint venture between UK-owned conglomerate Entain and MGM Resorts International.
Essentially considered the three major brands across these states, they were also perfectly positioned to quickly launch in new states, with the requisite infrastructure and marketing expertise already firmly in place.
While there were, of course, a number of other firms competing in these states, particularly from the European and even UK markets, via a partnership (which was required), with a local casino or racecourse, these were essentially, for all intents and purposes merely making up the numbers.
For years, it appeared that US market domination in the (at the time in the country) seemingly small online gambling industry would see the aforementioned three companies acquire and retain the lion's share of the market. However, in the last two years at least, it appears another animal – PointsBet, has pounced, and it is far from relinquishing its iron-clad grip.
PointsBet - An Outsider with Inner-Circle Ambitions
In 2015 when the Australian online gambling firm, PointsBet was founded, there was a clear and definitive directive, almost as if cultivated purely on speculation. PointsBet USA CEO Johnny Aitken always had the US market in mind with an almost tunnel-vision-like focus.
Two years later, following extensive research and development, the PointsBet site was launched. It had to wait until January 2019 before it could realize its ambitions, launching in the US market, having with Meadowlands Racetrack to offer mobile sports betting to the New Jersey market.
Three months after launching in New Jersey, the brand didn't stop there, with the sportsbook agreeing to a deal with Catfish Bend Casino to offer mobile sports betting in the state of Iowa. In the years that followed, PointsBet has been particularly proactive, impressively implementing a strategy that has seen the brand become a serious foreign operator in what is the fastest growing and also potentially most lucrative market in the industry.
Despite still going strong in the Australian market, the emphasis has always been on the US, highlighted by the firm's early entry, which helped to consolidate a strong foothold for desired success.
Aitken is a man who knows what he wants and, it appears, how to get it.
Almost right at the beginning of their foray into the US, he revealed: "Our focus from day one has always been on the US, with Australia very much a proof of concept for us to get our Points Betting and sportsbook capabilities tuned up to execute at an optimal level when the market here finally opened."
It was also interesting to know what the firm's strategy was in its infancy, especially in the US market, with Aitken explaining: "The NBA and NFL represent just under 30% of our handle with our trading team experts in all US sports." It could also be argued that PointsBet was ahead of the curve - especially for the US market, when it came to technology in order to assist with customer acquisition, with Aitken keen to emphasize the brand's commitment to continued development.
He continued: "We have also invested heavily in building a high-performance quantitative analytics department, which powers us to offer hundreds of betting options and player propositions not available anywhere else in the world for the NFL, NBA, MLB, and NHL."
"Points Betting is like spread betting in the UK, but the scoring mechanics are far more suited to the US and Australian sports than it is in the UK with soccer," he added.
If you have a normal fixed-odds bet, you could very well know at the half time whether you will win or lose, whereas if you have a points bet, you are watching the match until the very last second as each play and score can impact your bet.
Applying the mindset of 'what works in the UK or Australia will work here is an approach we think will backfire for those entering the US market. We will be ensuring we continuously improve the client experience across each touchpoint, building innovative and engaging products to deliver what a US client is demanding – not what we think they want.
Arguably, one of the most important things that PointsBet adopted from the beginning, which has, it could be said, been crucial to its performance and growth, is to implement a razor-focused commercial strategy.
Widespread Market Presence
Thanks to early penetration in the US market, PointsBet USA has swiftly become one of the savviest sportsbooks available, and this has made sure that they are able to compete against some of the major competitors.
Being aware of how these markets operate, due to having agile and sophisticated technology in place, in addition to intelligent recruitment plus a crack executive team, these have all been complementary factors in helping the firm to establish itself as a serious contender.
Within a matter of months, they had launched in every state that they were able to, with only a handful enabling residents to engage in online sports betting.
It was 2020 when things really started to progress on an uphill trajectory for PointsBet. Launches in Colorado and Indiana that year, at the height of a global pandemic, highlighted the strength of the firm's ambition and also the astute precision of its strategy.
However, at this point, the brand was playing catch up with US brands in what were already effectively mature markets and had to adapt its marketing strategy in order to differentiate itself from the likes of DraftKings and FanDuel.
In September 2020, PointsBet struck a five-year partnership deal with the University of Colorado - this acting as a springboard for a rapid awareness campaign. Indeed, at the time, this was voiced by Colorado University Athletics' Director, Rick George, who revealed:
We're thrilled to have PointsBet as a partner and for the benefits, this sponsorship will provide for our student-athletes for years to come.
We are impressed with their commitment to raising awareness around responsible gaming. And we're particularly excited whenever we can partner with sponsors who call Colorado home.
Aitken, meanwhile, provided further insight into the firm's intent for growth in the US, stating:
Since getting our foot in the door and winning our first market access deal in New Jersey, we've really been able to prove our execution excellence.
This is it for us; our success is solely defined by how we perform in the US, and I think that's been seen in how well we've executed.
In the same year (and month), after launching in Illinois for mobile sports betting, PointsBet closed on a sponsorship deal with the NFL side, Chicago Bears, as it continued its aggressive expansion throughout the Midwest.
Aitken told the online US publication Sports Handle at the time: "The PointsBet team is incredibly excited to become the first legal sportsbook partner in Chicago Bears history. We are teaming up with a first-class organization supported by extremely passionate fans."
Since launching our fast and differentiated mobile sports betting app in Illinois, we've been thrilled by the reception from Chicago sports bettors.
We've always viewed Illinois as a supreme market opportunity for the PointsBet brand, and we look forward to increasing our presence alongside famed partners in the Chicago Bears.
In what was also another clever move, PointsBet signed former Bears' defensive back and return specialist Devin Hester to be the face of its Illinois betting site as a bid to further ramp up interest in its sportsbook with local betting enthusiasts, driving acquisition, with Bears' fans receiving a unique sign-up access code that provided them with special promotions.
By now, the operator's US marketing and branding strategy were clear. Astutely embracing the franchise sponsorship model across multiple popular US sports as a way to differentiate itself in an increasingly competitive market to stand out from US firms was a clever move.
In June 2020, the brand had agreed to a landmark deal with the MLB (Major League Baseball) franchise, Detroit Tigers (Michigan), to become their official betting site, in the process beating key rivals to be the first sportsbook to do so.
The PointsBet USA CEO was keen to emphasize what this would mean to the brand and how it would help to lay the foundations for what was to come:
The PointsBet team is excited to announce our ground-breaking deal with the Detroit Tigers and Major League Baseball, becoming the first legal sports betting operator in US history to partner with an MLB franchise.
PointsBet operates in a rare space within the industry by owning our technology environment from end to end, which allows us to be extremely nimble in product innovation and personalized offerings to complement our app's market-leading speed. We offer the most betting options in the world on MLB games via our unique PointsBet product, and we are excited to inject a unique and robust betting proposition into the great state of Michigan.
Interestingly, baseball was the sport that Aitken had identified as the one that could substantially help the brand increase in popularity in the US, or, certainly, a sport that he and the executive committee felt was primed for the most evolution from a betting perspective, via further, strategic sponsorship and partnership opportunities.
"Baseball is the sport most ripe for disruption," Aitken explained to Front Office Sports.
Right now, it's really just wagering on the run line or money line. We can turn one long game into 700 mini-games.