It’s safe to say PointsBet isn’t your grandfather’s sportsbook.
After making its New Jersey debut in January, the Australian-based sportsbook is already making a name for itself.
That combination has led to a growing market share in hyper-competitive New Jersey, with March estimates indicating PointsBet is closing in on 5% market share.
Play USA recently spoke with Seth Young, the chief innovation officer of PointsBet, about the company he joined in November, its US entry, the current market and what’s coming down the pipe.
The foundation of PointsBet’s success
Play USA: Can you tell us about PointsBet and how it’s been received in the US market?
Seth Young: PointsBet launched its brand in mid-January, and we’ve been quietly, or perhaps not so quietly, picking up market share in New Jersey.
PointsBet is focused on the USA and is underpinned by a rapidly growing, strong Australian business.
We’re not facing any headwinds in maturing European markets that would put pressure on our overall business, and this has afforded us the ability to execute effectively in a US market that demands attention. Our pricing and promotions are market leading, and our “Karma Kommittee” concept has been quickly adopted by other operators.
From end-to-end, PointsBet also owns its own technology and sports ecosystem. This is advantageous for us as we have no reliance on third-party technology dependencies. We can expand quickly, we have control over new products we want to introduce into the market and dictate when we want to do it. Agile is an oft used buzzword, but it’s fair to say PointsBet is more agile than others.
The PointsBet approach to marketing and promotions
Play USA: PointsBet is engaging in some unique (in the US) marketing campaigns. Can you explain the impetus for paying out “karma bets” and how that fits into your overall brand-building plans?
SY: PointsBet’s Karma Kommittee has certainly had its hands full.
Starting from the egregious, blown pass interference call in the AFC championships, to Zion Williamson blowing out a shoe, to the heartbreaking end of the UCF/Duke game during March Madness, we have been focused on doing the right thing for our clients by refunding bets.
We’re watching the same game that our clients watch. Taking a bad beat is disappointing, and we’re happy to offer our clients a second chance on another wager when the outcome of a game isn’t fair … or, in our view, just heart-wrenching.
This is the same kind of ethos we brought to our Game Day Guarantee, which allows all clients to bet to win up to $10,000 on main markets for US sports, coupled with the lowest margins in the market.
We’re doing these things because we recognize that we’re not just competing against other bookmakers in New Jersey, but we’re competing with black market sportsbooks that are targeting US customers.
There has been a fair amount of talk about New Jersey clients having bets limited at other sportsbooks, and that doesn’t seem like an efficient way to reconvert or retain black market clients to regulated market clients.
Evidenced by our pricing and promotions, we’re working to build a brand that our clients can trust, but also working to help any state that we operate in (to) realize the full potential of its sports betting market.
Early challenges in the US sports betting market
Play USA: What are some of the challenges, branding or otherwise, PointsBet has encountered in the US market?
SY: The biggest challenges facing PointsBet – and really all sports betting operators in the US – are high tax rates and poorly structured commercial frameworks in new markets.
Support for legal sports betting is widespread, and with such a prolific black market it is incumbent upon lawmakers in each state to create an environment where it makes sense for companies like PointsBet to invest. To help take market share away from the black market operators that are accepting billions of dollars in wagers every year.
New Jersey is a great example of a strong market structure put forward by thoughtful regulators. Pennsylvania – with an incredibly prohibitive commercial framework — is a great example of good intentions overshadowed by poor planning.
Education of lawmakers contemplating market structures is the biggest and most immediate challenge that comes to mind.
…and early surprises
Play USA: We’re approaching the one-year anniversary of the SCOTUS decision on PASPA, In your view, what are the most surprising developments in the nascent US sports betting market?
SY: One year later, I can’t say I’m overly surprised by how the market has evolved to date.
It’s clear that New Jersey – with a fully mobile environment and robust competition – is performing leaps and bounds better for the state and its constituents than a retail-only environment in Mississippi, and by lottery-controlled, single operator monopolies like Rhode Island and Delaware. Those are examples of states that are vastly under-performing because of how those markets have been structured.
If a state’s intention is to curb organized crime and drive substantial new tax revenues, the best structure is to have a mobile environment with open competition. This is a fact, and I’d say it with my PointsBet hat on or off.
The biggest surprise, which isn’t really that surprising if you think about it, is seeing sports betting legislation surface in a state like Texas. It just goes to show you how ingrained sports culture is across America, and that there is strong pent-up demand for legal betting options.
Play USA: What can you tell us about PointsBet’s future plans in New Jersey and beyond?
SY: PointsBet is being heralded as the people’s choice in New Jersey, and we’re thrilled to have the opportunity to bring our market-leading product, promotions, and sports entertainment experience to other markets. It should be an exciting year for PointsBet and its clients.
Author’s note: On Monday morning, PointsBet announced a partnership with an Iowa casino ahead of legalization efforts in that state.