Gambling Ads Continue to Find More Airtime in the US

A look at the exponential growth of the gambling industry is enough proof that sports’ betting is going to be around for a long time. Whether in the US or any other location around the world, the nature of promotions facilitated by gambling operators is an indication that there is still such a huge chunk of the market that is yet to be explored. 

Some critics are however concerned as to the volume of advertisements going around. This is such a serious issue that economies such as Australia, the UK and Italy are controlling gambling advertisements by clamping down on volume and timing. With the high number of gambling business running in the US markets, it is only a matter of time before such measures are enforced. 

Gambling Ads to be Restricted

As per ratings generated by Nielsen, the budget allocation for running online gambling TV commercials rose from $292 Million in 2020 to $725 million in 2021. To better understand this budget – imagine that gambling operators spend three times as much as cereal companies on advertising. 

According to Nielsen, there are a lot of growth opportunities for the gambling sector. Reports indicate that ads directly related to gambling constitute approximately 1%of the TV ads market. The auto industry outnumbers this with their $7.9 billion media marketing budget. These figures are supported by data contained in the new Barron’s report. With the rate at which more markets are warming up to gambling, the industry is expected to allocate even more money to ads to reach potential audiences. 

As the gambling wave catches on in many states across the United States, vibrant states such as New Jersey are receiving high volumes of license applications. It is in this seemingly saturated gambling market that Borgata, BetMGM and other players are making a kill. In 2021 alone a total of 11 jurisdictions, including Michigan and Connecticut legalized gambling at the state level. 

New York is one of the youngest markets and it is possible that California will be joining the bandwagon by the end of 2022. For Florida, the relief of having crossed this hurdle was short lived when it was forced to back down due to a larger dispute that is ongoing to date. 

Honestly speaking, there are over 12 bookmakers each one of which is trying to outdo the others for recognition and market share in multiple states. For gambling organizations that have sufficient or consistent cash flow, the idea of offering freebies or goodies to new customers and financial large media campaigns is just part of normal business operations. 

Nielsen reports that 93% of funds spent on TV ads in 2021 was courtesy of four gambling operators who are considered heavy weights in the industry; Caesars Entertainment, MGM Resorts International, FanDuel and DraftKings. The four casino industry giants have both online sportsbooks and online casinos. 

Little Rewards from Big Expenses

A majority of gambling companies have reported that they are growing as a result of investing in advertising. According to a Morgan Stanley Analyst, Thomas Allen, every state had a bunch of five consistent top performers. Looking closely at the marketing data, it is evident that a minimum of 82% was controlled by these top spenders.

In Michigan for instance, the top five gambling operators had control over 90%of the total market share. The ratio of competitors to top performers in MI is currently 14:5. Allen is of the opinion that the negative reporting on the subject of spending on promotions and marketing, has created a market where operations are highly concentrated such that only businesses that have invested in scaling will survive. It is unfortunate that some operators are spending more than they are making in the hope that the increased business will help them to offset the deficit. 

Apart from creating an unlevel playing field where well-to-do businesses get an upper hand due to their budget, the television ads have started to attract scrutiny from industry regulators. Even without paying attention to the amount on airtime that is consumed by ads, regulators are worried about the nature of messages getting aired to the public. 

New Jersey Assemblyman, Ralph Caputo is the chairman of the state’s Committee on Tourism, Gaming and the Arts. A former casino employee, he is now strongly opinionated on matters to do with time allocated to media advertisements. Caputo recalls the advancements in nature and duration of advertisements intended for TV audiences. He refers to the volume of gambling ads on television today as absurd and is championing for restrictions to have them toned down. With the upcoming high stake poker season fast approaching, it will be a nightmare to sit in front on the TV in December.

Even though it is annoying to sit through an extended period of time in front of the TV watching gambling commercials, some insiders in the industry still do not believe that the proposed regulations are necessary. The American Gaming Association has proposed that every casino operator should have internal checks for policing their activities as well as a joint responsible marketing code that governs all of them.

It is highly unlikely that these efforts will be effective in appeasing lawmakers especially at a time when the elections are almost. Just to be on the safe side, the gambling industry should start laying the groundwork for how to implement tighter restrictions – it is about time that all stakeholders know that stricter measures are inevitable and therefore worth preparing for. 

Final Thoughts

Ads are definitely necessary for promoting business but they can be annoying if they are imposed on the audience. On television, unlike on platforms such as YouTube, consumers have no choice but to stick around and watch to the end. This is the inconvenience that people wish to have removed from their lives. The US is a large economy and if all the gambling businesses are given airtime on TV, there might not be enough time left for other content.

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