Each year, US gambling operators tend to spend a lot on advertising. With the US gaming market being as competitive as it is, no company can allow its marketing efforts to be lacking. BIA Advisory Services, a US-based consultancy, predicts that this year’s spending will be much higher than last year’s as gambling companies remain bullish on attracting more customers.
BIA Believes Marketing Expenses Will Skyrocket
Experts believe that US operators may spend as much as $1.8 billion to promote their products across the country. For comparison, last year, operators spent only $1 million on ads. Nicole Ovadia, vice president of forecasting and analysis at BIA, also shared that ad spending may reach $1.9 billion in 2023.
However, the actual spending in 2023 may be much higher, depending on potential changes to the regulatory landscape. If, for example, another big state legalizes gaming, companies will have to spend more to expand their influence while the market is still fresh. One such state is California which may soon see the launch of its own sports betting market.
BIA experts also noted that the popularity of gaming helps local media sellers in regions where gambling is legal.
Companies’ Spending May Depend on Regulations
So, which are the biggest spenders? It is hardly surprising that the companies that spend the most on advertisement are also some of the biggest operators in the US. The list is headed by companies such as Caesars Entertainment, DraftKings and FanDuel, which all spare no effort to promote their products to gamers in the country.
Caesars, for example, recently ran a $1 billion campaign to acquire new customers. Following this stellar campaign, the company’s chief executive, Tom Reeg, said that Caesars will tone down the ad expenses. FanDuel, on the other hand, will “spend what it needs in order to be competitive” but will try to maintain a degree of financial discipline.
Despite companies’ intentions to take a step back and reduce the money they spend on marketing, the changing regulatory landscape may force them to spend some more. As mentioned, operators will have to adapt when new states launch legalized gambling. While everyone remains focused on the fate of sports betting in California, other states, including Ohio, Massachusetts and Maryland, prepare to legalize iGaming next year.
While more markets mean more expenses on ads, they also mean more customers. If companies hope to grab the lion’s share of customers in new markets, they would also have to invest more in ads.