BetMGM CEO Adam Greenblatt believes no new states will legalize online casino during 2023.
Therefore, the US online casino market leader is working “behind the scenes” this year to help educate legislators and retail casino owners about the benefits. That will hopefully yield an active 2024 in legal online casino launches, he said during today’s BetMGM Business Update.
Greenblatt said of some retail casino leaders opposing online casino launches:
I do not believe that market anomalies, market distortions, retain over time.
He said BetMGM‘s investment in education, that’s “sowing the seeds” for new legislation, will help alleviate opponents’ concerns. So Greenblatt believes US online casino launches are more likely in 2024.
Stock prices for BetMGM’s owners, Entain (Entain PLC 1.109,50 +1,98%) and MGM Resorts International (MGM Resorts International 38,77 -1,10%) appeared stable after today’s business update.
BetMGM Remains the US Online Casino Market Leader
In Q4 2022, BetMGM again held the plurality of the online casino market share, or 30%, in the states where it operates.
Greenblatt said today:
So sure, we’re the one to get.
In one of those markets, Michigan, BetMGM has remained No. 1 since the state’s marketplace launched on Jan. 22, 2021. There, BetMGM earned more than $1 billion in gross gaming revenue (GGR) from January 2021 to December 2022, according to the Michigan Gaming Control Board (MGCB).
BetMGM CFO Gary Deutsch said during today’s call:
The gaming states have all beat our expectations.
States that offer online casino and sports betting turn a profit faster for BetMGM than sports-only jurisdictions, Deutsch said.
Plus, Ontario is already reaching profitability after launching on April 4, 2022, the CFO said.
Greenblatt added that BetMGM’s US online casino states are entering their third year of operation.
Marketing Remains a Necessary Cost
During last year’s BetMGM Business Update, Greenblatt said online gambling operators needed to rein in their marketing and promotional spending.
Today, he sounded more excited about the form of business spending.
We value flexibility, and we follow the data. … We’re advertising more on TV.
So even though directly marketing to gamblers through email and other channels tends to cost less, BetMGM is upping its brand marketing investment, he said.
Conversely, BetMGM will pull the plug on “very, very short-term” performance marketing efforts if they’re not working. Monitoring those investments daily ensures BetMGM allocates its money toward the best return on investment (ROI), Greenblatt said.
Greenblatt said of marketing spending in the online gambling industry:
The early exuberance … is abating, somewhat.
This is “wave two” of online gambling marketing spending, Greenblatt said. BetMGM is using an omnichannel approach, mixing brand and direct marketing, promoting online gambling to MGM’s retail players, and using predictive models to determine which bettors to make an effort to retain.
Our data science has gotten excellent.
Predictive modeling shows BetMGM which players will evolve and how, which benefits bonusing. That means the brand can use promotions intelligently.
The marketing spend is coming down as a result of the acquired players.
That’s not to say that BetMGM isn’t paying attention to its online casino, poker, and sports betting competitors.
We pay very close attention to the competitive landscape, but we run our own race.
Meanwhile, BetMGM’s forecast is for the online gambling brand to become profitable during the second half of 2023. That’s even with the increased marketing costs that will be associated with the new online sports betting states of Maryland, Massachusetts, and Ohio.