US SPORTS BETTING IN 2023
betting free bets ( in states where this is reported ) have averaged 39 % of gross win and 3.2 % of handle . That is to say that actual customer losses in the past year are c . 39 % lower than the reported market gross win .
Fig 6 : Free bets as % of handle ( left ) and gross win ( right )
8
6
100
75
FREE BETS IN DECLINE ?
However , investor pressure on operators to show a path to profitability has led to a reduction in promotional activity . Therefore , we have seen a reduction in free bet percentage in 2022 compared to 2021 .
We caution that when looking at free bets as a percentage of gross win , individual monthly data can be influenced by the hold margin . In that sense , the June 2022 free bets data looks higher than it actually is , and the September free bets look a lot lower , due to the higher than normal gross win on the back of very favourable sports results ( see Fig 7 ).
SPORT BY SPORT ANALYSIS
The US sports betting market is dominated by three sports – football , basketball and baseball – although the timings of each of the seasons means that the split of betting between these sports varies significantly throughout the year .
On average , these sports represent c . 80 % of total handle throughout the year – although during Q2 / Q3 2020 , this was significantly lower as major sporting events were cancelled .
While the basketball season starts in October , there is strong competition with the NFL during calendar Q4 , and therefore it is not until the first calendar quarter of the year when basketball becomes the dominant product for sports betting , culminating in the March Madness college basketball finals .
This changes towards the middle of the year when baseball takes over as the dominant product , filling the gap between the end of the basketball season and the start of the football
% Handle
4
2
0
Jan-21 Feb-21
Mar-21 Apr-21
May-21 Jun-21
Jul-21 Aug-21
Sep-21
% Handle ( left ) % Gross win ( right )
Source : State Gaming Boards , H2 Gambling Capital , January 2023
Fig 7 : Free bets as % of gross win : 2022 vs 2021
100 90 80 70 60 50 40 30 20 10 0
Oct-21 Nov-21
Dec-21 Jan-22
Feb-22 Mar-22
Apr-22 May-22
Jun-22 Jul-22
Aug-22 Sep-22
Oct-22
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
% Gross win - 2021 % Gross win - 2022
Source : State Gaming Boards , H2 Gambling Capital , January 2023
season . However , as we get to the end of calendar Q3 , football becomes the focal point , with the NFL / college football generating the majority of
Investor pressure on operators to show a path to profitability has led to a reduction in promotional activity
50
25
0
% Gross win operator gross win from October to January ( see Fig 8 overleaf ).
The seasonality of the sporting calendar means that inevitably some parts of the year have a greater impact on sports betting operators than other parts . However , there are also three key events in the sporting calendar when competition intensifies : the start of the NFL season in September , the Super Bowl in February and the College Basketball Championship ( March Madness ) in March .
12