SBJ Betting: Yahoo-BetMGM Partnership Proving Mutually Beneficial

Thanks to its live stream of Sunday’s Super Bowl and oodles of related print and video content across its platform, Yahoo Sports says it expects to up the ranks of bettors going from its Yahoo Sportsbook pages to wage at BetMGM by more than 20%. This caps a year in which the site has generated 220 million page views for its betting content, with 89% of them coming since July. Through the year, Yahoo attracted 69 million views for its betting videos.

Yahoo would not disclose how many bettors it has referred to BetMGM, but said it ranks near the top of hundreds of affiliates, with a strong track record of users converting to qualified players. That migration of Yahoo Sports users, who skew heavily toward fantasy, to the BetMGM site in legalized states was the core premise behind the deal that made BetMGM the exclusive sportsbook operator of the site in October 2019.

While other sportsbooks have played musical chairs striking exclusive deals with the broadcast networks, BetMGM has opted for a wholly digital option that puts its targets one click away from placing a bet. You can’t wager on the Yahoo Sportsbook page, but a click on a line, a total or an over-under will migrate users in legal states over to BetMGM.

“The interactive nature of every one of our touchpoints for the customer means that 100% of the time that the customer is in front of the offer, they’re one click away from being able to jump into that experience,” said Geoff Reiss, GM of Yahoo Sports. “You won’t see MGM ads plastered all over Verizon media properties, because that’s not what we’re here for. We’re here to grow the business with them.”

Yahoo’s deal with BetMGM is structured similarly to other betting affiliate deals, with Yahoo and parent Verizon collecting revenue based on how many active bettors it drives to the sportsbook. But this one is on steroids, amplified by Yahoo Sports' monthly reach of 70 million, which extends well beyond avowed self-identified sports bettors.

“A lot of these (sportsbook/media) deals are basically ad deals dressed up as strategic betting deals, where the primary interest from the media entity was to insure a large number of committed ad dollars flowing through, because they’re really good at booking large numbers of ad dollars,” Reiss said. “One of the things that drew us very close to BetMGM was the ability to create a deal where our interests in this industry were going to be very closely aligned. We weren’t just going to be just this engine that pumped folks over there. We were going to work very closely with these guys to not just identify very qualified bettors, but then to make sure that we regularly re-engage these folks and make sure the value of those customers were among best in class."

The most valuable of Yahoo’s denizens is the fantasy player, which it has in spades at all levels, from dalliers to daily bingers.

Reiss pointed to three components that have helped Yahoo drive those users to BetMGM: Promo offers that are essential in an emerging market, such as the $100 in free bets new users can win on the coin toss Sunday; engaging content that attracts interest and then makes it easy for users to click through to BetMGM; and extensions that bring users from other Yahoo and Verizon digital platforms.

“There’s not a single magic bullet here,” Reiss said. “For a fan interested in sports betting, looking at sports through a lens (that embraces that) is fundamental to creating the environment that drives conversion.”

The smart money says we are on the precipice of having the nation’s most bet on event, the Super Bowl, played in a state in which visitors can actually bet on the game legally -- and that we may then see it happen three years in a row coming soon.

Arizona, scheduled to host the game in February 2023, went from warm to simmering on the sports betting stovetop this week when legislators introduced a first-of-its kind bill that would give not only pro team owners, but also the owners of Phoenix Raceway (NASCAR) and the PGA Tour’s Phoenix stop (Thunderbirds), control of access to licenses to then sublease to sportsbooks.

The latest evolution of a framework that gave teams and facilities control of retail licenses in D.C., Illinois and Virginia, the Arizona bill also would convey access to operate online sportsbooks statewide, a massive upgrade over previous models, since sportsbooks will pay considerably more to unlock the entire state.

Sportsbooks in Illinois and D.C. can use their team-granted licenses for mobile, but only within proximity of stadiums and arenas. Virginia extended that model to include speedways.

“It’s the brass ring,” said Sara Slane, a sports betting consultant who works with leagues, teams and sports media companies. “(An online license) is a much more lucrative proposition for the teams.”

Arizona is another example of a state moving more quickly than expected, while some others who were thought to be early movers have stalled. Both the pace, and order, of state rollout have proven difficult to handicap.

Arizona’s path is complicated by a strong presence by its native tribes, which operate 26 casinos. Introducing sports betting in a strong tribal state typically means re-opening the compact that sets the parameters of tribal gaming, which can mean a renegotiation of everything. In the bill now on the floor, the tribes and teams each would control 10 licenses covering online and retail, while the state’s three horse tracks would control 10 retail-only licenses.

“There were so many variables,” said Slane, who once pegged Arizona as a likely late mover. “But the governor’s office and the legislators and the tribes have done a good job at trying to best figure out how to modernize and compete with other interests. As long as people are willing to put the work in and hash out the differences and look at the bigger picture of what it can mean for the state and the gaming interests there, there’s always going to be a path forward.

Slane is “bullish” on Arizona passing this session and opening during next football season. That would easily be in time for the Super Bowl LVII in 2023. New Orleans, which is on tap for Super Bowl LIX in 2025, should have sports betting by next year. The location of Super Bowl LVIII between those two remains TBD, but Las Vegas is a strong contender.

That'd be your three in a row, with many more to follow.

The PGA Tour’s newfangled NBC Sports Edge BetCast airing on Peacock got me thinking today.

Matthew NeSmith, a little-known, lowly ranked young player, went to bed last night as the leader after one round of the PGA Tour Waste Management Phoenix Open. What would happen if he had showed up today with the logo of offshore sportsbook Bovada on his cap and bag looking to pocket some quick sponsor cash?

The answer, courtesy of PGA Tour VP/Gaming Scott Warfield, is that he’d have to lose the cap and switch bags. The Tour will allow players to sport sportsbook logos, but only those of sites licensed to operate in the U.S. So, nada from Bovada, MyBookie, BetUS, etc.

They can do deals with sportsbooks that aren’t part of the Tour’s authorized operator roster -- as long as they’re licensed in a legal state.

The battle for market share shifted slightly in Illinois in November, the most recent month for which that state’s regulators have released data.

Market leader DraftKings ($168 million) increased its share of handle in the state from 34% to 38%, while Chicago-based BetRivers ($134 million) grew by four points to 29%, pulling ahead of FanDuel ($115 million), which held steady at 26%. PointsBet ($27 million) plunged from 15% to 6%.

Overall, handle in Illinois rose 5% from October to November, increasing to $454 million for the month. That made Illinois the nation’s fourth largest market, behind New Jersey, Nevada and Pennsylvania.

Other Illinois tidbits:

• Pro sports accounted for 75% of handle, generating $339 million to college sports’ $114 million. It was also far more profitable for the books, yielding $41.6 million in gross revenue. The books lost $262,845 on college games in November.

• Football had the menu mostly to itself in the month and dominated the handle at 56% ($256 million). Soccer was next at 11% ($50.3 million). Basketball was 6% ($28.2 million). Football handle grew from $88.7 million in September and $186.7 million in October before hitting $256 million in November.

States that have reported December figures all saw a balancing of the scales between football and basketball wagering, when both pro and college hoops returned to the schedule.

The balance in five states for football vs. NBA/college hoops: New Jersey (32%-26%), Colorado (36%-27%), Indiana (33%-29%), Oregon (46%-31%) and Mississippi (49%-27%).

With December totals in from regulators in every state except Illinois, we’ve got a clear view of how legalized states compare to each other. Here’s how they rank, based on handle from July through December.

NOTE: * = Illinois figure is through November only.

• My colleague Adam Stern this week broke the news that Richard Childress Racing has landed BetMGM as a new sponsor, the first time one of the major U.S. sportsbooks has done a deal with a NASCAR team. The deal is for one year to start.

• The Georgia Lottery Mobile Sports Wagering Integrity Act this week headed to the state legislature's House Rules Committee for further consideration before a potential vote, notes the Atlanta Business Chronicle. The legislation, which is backed by Atlanta’s pro sports teams, "could potentially pave the way to legalize pari-mutuel betting and destination resort gaming, but for now the Georgia Professional Sports Integrity Alliance is only endorsing mobile sports betting."

• There were 23 lotter/gambling sponsorship deals signed by NFL teams this season, which drove spending in the category up around 25% from last season, per data from IEG. BetMGM signed six new deals, while Monkey Knife Fight, PointsBet, Caesars and DraftKings all picked up at least two deals. The Raiders also had casino brands as three of the 13 founding partners during the team's first season in Las Vegas.

• What do PGA Tour pros think about legal sports betting? Talking to USA Today, Webb Simpson and Justin Thomas had some concerns about the growth in the space, particularly with how it relates to any effect on competition. Simpson said. "Hopefully they’ll put a strict plan in place that we’re not going to have kind of the comments from the bettors out there during the round." Thomas added, "I worry about any sort of sketchiness going on with whether it’s communication within someone that’s out on the grounds and could potentially yell or do something to affect a person that would have, say, a wager or something and that’s a serious, serious concern. We’re out here playing. … this is our job."

• While cruises largely remain on hold amid the pandemic, once they return, passengers booked on Princess Cruise's MedallionClass ships will have access to sports betting. Princess says it's the first cruise line to offer this option. The Ocean Sportsbook will offer pro and college football, basketball, baseball and hockey via the MedallionClass app while ships are in international waters, or wherever else gambling is legally permitted. Princess is owned by Carnival, whose owner Mickey Arison also owns the Heat, meaning passengers can't bet on NBA games involving the team.

• UNLV and U.K.-based Entain, which owns 50% of BetMGM, are teaming up to get more women into the sports betting, gaming and technology industries, notes the Las Vegas Review-Journal. The Black Fire Women’s Innovation Igniter is "set to launch in August with an initial class of 20."