Pennsylvania Online Sportsbooks Set Promo Spending Record in September

In September 2023, Pennsylvania online sportsbooks set a new record for promotional spending, allocating a total of $29.5 million. This financial investment is a clear indication of the anticipated surge in activity with the football season in full swing. While this trend is not unexpected, the scale of promotional spending remains a topic of interest. As the state's sportsbooks continue to invest significantly in attracting and retaining bettors, let's dive deeper into the details of this spending and its implications for the Pennsylvania sports betting market.

Promotional spending in the online sports betting industry is closely tied to the sports calendar. During the summer months, when there are fewer sporting events, promotional activities typically slow down. However, as the football season kicks off, operators ramp up their promotional efforts. Pennsylvania sportsbooks have observed a consistent increase in promotional spending during the month of September over the years. To illustrate this, we can examine the monthly promotional credits in Pennsylvania since 2020:

• 2020: $12 million
• 2021: $19.9 million
• 2022: $25.1 million
• 2023: $29.5 million

This growth trend reflects the increasing importance of the football season for sportsbooks. With each passing year, the competition for bettors' attention and loyalty during the football season intensifies.

In Pennsylvania's dynamic online sports betting landscape, market leaders have consistently been the key contributors to promotional spending. Two of the most prominent operators in the state, FanDuel Sportsbook PA and DraftKings Sportsbook PA, were at the forefront of the promotional activities in September. FanDuel and DraftKings are renowned not only for their sportsbook offerings but also for their strategic and aggressive promotional campaigns.

In September 2023, DraftKings led the pack, allocating $11.5 million for promotional credits, while FanDuel was close behind with $11.1 million. Together, these two platforms accounted for a remarkable 77% of the total promotional spend in the state. The synergy between sportsbooks and promotional efforts from the industry leaders demonstrates their commitment to capturing a substantial share of the growing football betting market.

The increased promotional spending in September is not merely a reflection of the football season's significance but also an essential strategy for maintaining player engagement.

Pennsylvania's sports betting market is considered mature, and sportsbooks must continuously find innovative ways to keep bettors engaged, even when there are lulls in the sports calendar. One of the strategies employed to achieve this is the cross-selling of sportsbook players into online casino platforms.

DraftKings, in particular, has embraced this approach. CEO Jason Robins explained the "halo effect" of retaining sportsbook players, which leads to spillover engagement in iGaming products. This strategy has proven successful, with DraftKings reporting revenue of $875 million during a Q2 2023 earnings call, signifying an 88% year-over-year increase.

Through increased promotions on the sports platform, DraftKings successfully drives more players toward its online casino products, such as DraftKings Casino PA. This approach has played a pivotal role in helping the company establish its leadership position in the US online gambling industry.

While the landscape of Pennsylvania's online sports betting market continues to evolve, the dominance of FanDuel and DraftKings remains a constant. FanDuel, despite facing fierce competition, retains its position as the top sports betting operator in the state. With an impressive lifetime handle of $8.9 billion and lifetime revenue of $864.4 million, FanDuel boasts substantial figures. DraftKings is a close second in both categories, recording a lifetime handle of $5.7 billion and lifetime revenue of $366.5 million.

Collectively, these two platforms are responsible for 61% of the state's lifetime handle and a significant 63% of its lifetime revenue. The unwavering influence of FanDuel and DraftKings underscores their ability to sustain their leadership in a highly competitive environment.

While FanDuel and DraftKings continue to exert their dominance, new operators are preparing to enter the Pennsylvania market. As Barstool exits the gaming industry, PENN Entertainment is gearing up to launch ESPN Bet in November. This addition will introduce another major player into the competitive landscape.

Another upcoming entrant is Fanatics Sportsbook, which has taken over operations from PointsBet. Fanatics Sportsbook is poised to introduce its own sportsbook, bringing its unique strengths to the table. As a prominent brand in the sports merchandise industry, Fanatics offers a distinctive promotional advantage.

The competitive dynamics of the Pennsylvania sports betting market are set to become even more intriguing with the arrival of these new players. ESPN and Fanatics are both well-known brands in the sports industry, and their entry into the market is eagerly awaited to see if they can challenge the established leaders in Pennsylvania.