In today’s article, we are taking a peek into the future of the ever growing sports betting market in the US and the challenges and opportunities that operators and customers will be facing.
With plenty of promise and some risks along the way, what do we see coming up in the future? Read on to find out.
Let’s begin by looking at some of the risks or hurdles along the way that operators in the industry need to face. Regulation is obviously the key issue, and the legislative landscape can be hard to navigate.
Every state is unique in terms of how they approach legal sports betting, which means that sportsbooks will also need a different approach in each state – something that requires a lot of resources and expertise. In a nascent market, that expertise is not always readily available.
Technology also plays a key part. Strict geolocation and knowing your customer requirements on top of needing to provide a smooth and engaging user experience brings forth its challenges.
The market is also already extremely competitive. Operators that are completely new will find it hard to enter, while some of the current players will surely fall out in the next few years.
From a customer’s point of view, some of the regulations in place in some states are troublesome. Where the lawmakers have introduced extensive fees and taxes on sports betting, the odds look bad and make it harder for smart investors to make profits. Obviously, states that allow only retail sports betting end up providing markets that are inconvenient and often also non-competitive in terms of the odds.
The opportunities are huge
Sports betting has already been legalized in 22 states and in Washington D.C. Three more states are projected to consider passing a bill still in 2020, while as many as 15 could discuss the prospect in 2021.
Sooner rather than later, the majority of the US population will have a legal sports betting market available to them.
The public perception has also changed. Betting on sports is now considered to be an acceptable pastime, a hobby among others that makes watching sports a little bit more engaging and fun.
This, in turn, has made sports teams, leagues and all sorts of businesses receptive to the idea of forming partnerships with bookmakers and promoting sports wagering. Even the national media outlets are now pushing betting related content out and talking about the lines or the odds for games in their coverage.
The big opportunity for sportsbooks here is to be able to act as something that connects people over this newly legalized and now accepted hobby. While sports betting is already a talking point to many people among their friends, could modern online sportsbooks capitalize on the potential network effects?
For example, people are currently using Instagram or Facebook because most of their friends are using them too and posting content there. Going to another social media platform where your friends are not present does not seem like a viable option.
Digital sportsbooks currently do not offer many things that could create a similar type of effect. But in the future, could the operators add social elements to their products that will facilitate interaction and make sure that players will want to keep their wagering under one platform?
Think of something along the lines of friend pools with leaderboards and wagering against other players, joint group bets, loyalty and referral programs, features where players can interact with each other, etc. The possibilities are there, and the one who’s able to pull it off might be the big winner.
The legal sports betting market provides an alternative asset class for investors
One of the major opportunities that the current developments bring is treating the sports betting market as an investment opportunity – something that we have been pioneering here at ScoreMetrics.
Having a market available that provides plenty of high ROI opportunities while not having a correlation to other asset classes is extremely enticing.
Others have noticed as well, and you can find examples of interesting research pieces on handicapping systems or even sports betting mutual funds.
Most of them lack the experience, the transparency, or the convenience though in order to provide a quality product for investors.
Legal sports betting is growing fast
2020 has been a big year for legal sports betting in the US. For some of the latest developments, have a look at our recent articles:
To take advantage of the return of sports and to learn everything you need to know about smart investing in the sports betting market, check out our head trader John Todora’s new book – “Zero Correlation Investing – The Score Metrics Secret”. It’s currently on sale for a limited time, so go get yours now!
The ScoreMetrics Lab is the engine that runs the Sports Trading System operation, consisting of a team of researchers and writers who are constantly testing and retesting algorithms. They work hand in hand with our Head Trader and Creator of ScoreMetrics, John Todora to help find new breakthroughs and develop new systems.