Ontario‘s regulated iGaming and sports betting market is just in its infancy after launching on April 4, but an interesting discussion on the future of online sports betting took place earlier this month at the Canadian Gaming Summit in Toronto.
A four-person panel headlined by Conor Murray, vice president of marketing at FanDuel, and Tristan Wootton, director of growth at Fitzdares, shared their visions of the future of online sports betting landscape around the globe, with a particular focus on Ontario. The panelists discussed a number of important issues, including sports betting demographic shifts, the role of fantasy sports, developments in sports betting products, and some recent comments regarding sharp sports bettors.
A shift in demographics and tendencies
Who is betting on sports and how are they betting on them? That’s the question every sportsbook is seeking the answer to when it launches in a given jurisdiction — and it appears to be a moving target.
“In our experiences in Europe, the sports bettor is now wagering potentially lower amounts, but more frequently throughout the week,” Wootton told the audience. “They’re young to middle-aged, and they are prepared now to spread their dollars throughout the week. Traditionally, we had a crescendo [of betting activity] on the weekend. I think now the battleground is Monday to Sunday.”
Ftizdares, founded in 1882 and the world’s oldest bookmaker, is coming to Ontario shortly. Wootton said the company is in the application process with regulators and it hopes to launch in the coming months. The sportsbook is very popular with horse bettors in Europe, and he hopes the legal framework in Ontario is tweaked soon to include equine wagering.
Murray also noted that sports betting is attracting more women as more jurisdictions legalize sports betting across North America. Recent surveys have shown that females make up one of every three sports bettors in Ontario, and that percentage is expected to grow.
Fantasy sports paved the way
The previous existence of fantasy sports games in the province of Ontario created a roadmap for some operators after sports betting was legalized in Canada last August.
Operators like FanDuel and DraftKings were able to build significant customer databases in Ontario prior to the launch of the regulated market, and Murray said the existence of this data has helped give FanDuel a slight head start on the competition.
“[Fantasy sports] was a good way of engaging fans in live sports in a very entertaining way while having money on the line. It kind of warmed up the market in a sense, I think. From my perspective, when sports betting did become legalized in these markets, it was probably a little bit more primed and ready to go,” Murray said.
Unfortunately, with the creation of the new regulated iGaming market in Ontario, FanDuel and DraftKings both made the difficult business decision to stop offering their daily fantasy sports contests in the province. Ontario regulators didn’t prohibit operators from offering DFS, but there is no liquidity permitted in the new market. All of the participants in these DFS games would have to be physically located in Ontario, if operators decided to continue offering them.
The elimination of DFS contests obviously angered many players in the province. However, FanDuel launched its sportsbook and online casino on April 4, followed by DraftKings on May 18.
— Sports Handle (@sports_handle) May 18, 2022
Evolution of sports betting products
A major discussion on the evolution of sports betting products took place, with a focus on the rise in popularity of in-game wagering.
The panel came to the conclusion that micro-betting could eventually become one of the most preferred ways of wagering on sports. Operators see it as a great way to keep bettors and fans engaged in otherwise trivial moments in sporting events.
“We built our whole marketing campaign around this concept of moments,” Murray said. “Previously, a moment might have been completely inconsequential, like when there’s a penalty in the third quarter of a blowout game. But what it actually means is they’re going to get in field goal range and kick an extra three points, so it will affect the spread.”
Murray also said in-game betting is “really entertaining,” but it’s being held back by TV lag times. Often, he said, the TV feed is up to 30 seconds behind what’s actually happening. If the industry can find a way to deliver in-game betting in real time, it could unlock the next evolution in sports betting.
In January, PointsBet became the first U.S. sports betting provider to offer clients live, in-game betting opportunities with zero time delays across the core markets of spread and moneyline. Operators will continue to attempt to evolve their products and have live streaming drive their in-play betting experiences.
In-game betting is the future of the fan betting experience, but in order to provide that experience the technology needs to be able to deliver. No one want to have their bet suspended and miss the opportunity.
That said, placing bets in real time as…https://t.co/5s1EmhHohh
— Scotty Vanderwel (@ScottyVanderwel) January 20, 2022
Sport integrity issues could become an issue with the rise of in-game wagering, though.
“I think these micro-betting opportunities are fantastic,” said Wootton. “They do de-risk the patron’s overall risk on that 90 minutes, 180 minutes, or whatever they’re wagering. I would just caution, though, that these micro-betting opportunities should be limited to high-class sports. Not just open up the algorithms and spread it across all these minor leagues, minor sports, like table tennis.”
Ontario regulators have said 70 or more operators could be live in the province by the end of the year, which would make the space extremely competitive moving forward.
“As operators continue to compete for customers, they’re going to have to remain innovative, they’re going to have to continue to innovate, and ultimately we’ll see the development of better products within the industry to attract more players,” said Brett Winston, the co-founder of BetSwap, a secondary marketplace for sportsbooks and platform providers. “Over time, you’ll see other large enterprise players acquiring smaller ones with better technology to allow them to acquire their user bases.”
Taking sharp money
DraftKings CEO Jason Robins went on the record twice recently stating he doesn’t want professional bettors to be wagering at his sportsbook. The comments went viral in the online sports betting community and it was a hot topic at the Canadian Gaming Summit. Inevitably, panelists were asked about their respective policies when it comes to accepting sharp money.
“We’re not going to let someone we know that’s a sharp bettor put on $300,000 and clean us out,” Murray said about FanDuel’s philosophy on sharp money. “But what we also want to do is make sure we aren’t giving them a $1 bet. That would be a really frustrating customer experience. We have the benefit of being able to do that as a scale operator, by taking a little bit of money we know we aren’t necessarily going to see a profit on, or really have any chance of winning in the long term, but we know it helps us get a lot sharper on our lines.”
— US Bets (@US_Bets) March 6, 2019
Fitzdares, as previously mentioned, isn’t yet live in Ontario, but Wootton believes the issue of sharp money is a huge challenge moving forward for operators.
“I can’t say we’re looking forward to taking too much sharp money in Ontario, but our experience in the UK is that we take very large wagers,” he said. “We have the means to look after customers and make sure our risk profile is managed.”
As far as a path to profitability in the sports betting industry goes, Murray says it is achievable, but not realistic in the early days of legalized sports betting. With so many jurisdictions launching in the past year in the United States and Canada, it’s going to take some time for markets to mature and become fully realized.
“We’re very early — there’s loads more left to do,” he said. “I think products, trading, and brand are all going to be important as we think about the long-term success of the market.”