Australian sports betting leader Sportsbet maintains its dominant position, potentially facing the departure of additional high-profile athletes.
Sportsbet remains the dominant force in Australia's sports betting sector, boasting a hefty revenue of $1.51 billion last year, equivalent to a commanding 48% market share. However, an adjustment in the utilization of athletes for promotions could potentially impact its leadership position.
Much like its US counterpart FanDuel, Sportsbet has played a crucial role in Flutter's global dominance in sports betting. The Australian division's 2022 revenue indicated a minor decrease of 2%, contrasting with a stronger performance in 2021. This suggests a intensifying competition within the industry.
Slight dip in revenue notwithstanding, Sportsbet saw a increase of 8% in its user base last year alongside a 3% decline in the amount wagered. During COVID lockdown periods in 2020 and 2021, Sportsbet experienced significant growth as a result of the shift from retail to online betting.
Beginning last July, New South Wales introduced a point of consumption tax, boosting the tax rate from 10% to 15% for sportsbooks. This tax hike partially contributed to a drop in Sportsbet’s revenue and EBITDA (earnings before interest, taxes, depreciation, and amortization).
In the December quarter, Sportsbet's user count reached a record high of 1.3 million, nearly double that of the fourth quarter of 2019. This growth is attributed to an increase in marketing expenditure and innovation, strategies which Sportsbet intends to continue implementing in 2023.
Australian Gambling Landscape Shifting
Similar to the UK, Australia appears to be moving towards stricter gambling regulations. This regulatory environment may affect Sportsbet's overall revenue, as evidenced by a decrease in the money wagered last year.
As the leading player in the online sports-betting market in Australia, Sportsbet witnessed remarkable growth during COVID lockdowns in 2020 and 2021, expanding at a rate 1.4 times that of the overall online market.
AFL Addresses Sportsbet Relationship
Politicians and anti-gambling advocacy groups call for a greater distance between sports and the gaming industry in Australia, echoing the sentiment in the UK that could lead to reduced revenue overall.
The Australian Football League (AFL) continues to maintain partnerships with Sportsbet and Crown Resorts, despite the controversy surrounding the relationship between sports and sports betting. Some athletes, such as Melbourne Football Club's Ben Brown, have declined to partake in gambling-related marketing.
The stance of the AFL and its players regarding the use of their images for betting promotions is subject to individual ethics and brand strategy considerations. Approximately 30 players, including Brown, have refused to allow their likenesses to be used for such purposes. The AFL and the AFL Players’ Association have agreed that a player's decision to opt-out will be respected.
Consequently, Sportsbet may have to rely less on popular athletes and seek out alternative star power to fill the void left by those who have declined to become the face of the company. Examples of this can be seen in BetMGM's recruitment of Jamie Foxx and Jerry Ferrara.
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