David Sargeant says there is no ‘right’ way to launch a sports book, but rather that each operator needs to define their objectives and find the right way for their business.
I am often asked, “what’s the best sports betting platform?” Or, “who is the best sports betting partner?” These questions make no sense without context.
You wouldn’t ask, “what’s the best car?” You would ask, “what’s the best car for a family of four who mostly use it for short urban trips?”
It’s important to remember that sports betting isn’t a single “thing”. If that were true my work as a sports betting consultant would be pretty limited.
Everyone will tell you that sports betting is what they sell. Vendors will tell you they are the best sports betting platform. Operators will tell you that they are the best partner.
Others will tell you that the first step is finding the right technology supplier or operating partner.
This is just patently not true. If you don’t set your goals and solve your whys, then I can guarantee you will discover you have the wrong partner.
Some operators thought that speed to market was the goal, and they are now suffering, “New Jersey regret”, having launched the wrong product, the wrong technology or just not having defined and costed their “multi-state omni-channel cross-product plan”.
I always start by talking through the sports betting life cycle, customer motivations and variations on models, products, and channels.
Setting a business plan
The next steps are on the white board. Work out what your goals and business objectives are. Are you driving direct or indirect revenue? Is this just about protecting core business? Who are you appealing to? What demographic?
Where are you engaging the customer? Local or national? Just on the casino floor or multi-state over the internet? Which brand? Which channels? Which products? Single wallet? How much of the operations/trading/marketing/customer services do you want to do? Do you want a route to ownership for technology or services?
Only after answering all these questions can you then decide which of the major strategy options work for you (outsource, operate, partner, JV, etc.) and who your partner should be.
There is also that small matter of cost and ROI. Without setting clear objectives, how are you ever going to evaluate what the correct cost should be and ensure you don’t overpay for the wrong strategy?
Don’t start by choosing technology or trading strategy, or by working from the assumption that Vegas or European styles of business won’t work in your state. Start by clarifying the objectives and then finding solutions to meet them.
Oh yes. And time to market might be a consideration. How your new sports product integrates to your existing tech stack and suppliers is always going to be a big consideration.
So this may sound rather obvious, and in some cases the choices trivial, but it is amazing how many companies I see skipping this vital step and not defining their objectives at all.
Only once you’ve done so can you start building towards success and solving the three key barriers to success – finding sports betting expertise in technology and operations, gaining market access, and having brand and customer reach.
David Sargeant is a sports betting consultant based in London. With almost 20 years of experience he has spent the last year focused on the US, helping casinos, tracks, tribes, leagues and media companies understand sports betting.