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5 Lessons Learned - Integrating an Online Sports Book Into a Land-Based Casino Group

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As the United States considers regulating sports betting, the most obvious path forward is through existing regulatory infrastructure in casinos and tracks. The Chalkline leadership team shares their experiences and lessons learned from integrating an online sports book into the largest land-based casino group in Africa after being acquired by Sun International.

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5 Lessons Learned - Integrating an Online Sports Book Into a Land-Based Casino Group

  1. 1. Experiences from a Regulated Market as the US Considers Legalizing Sports Betting July 2017 5 Lessons Learned Integrating an Online Sports Book Into a Land-Based Casino Group
  2. 2. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Executive Summary Background Lesson #1: Casino Patrons are Sports Bettors Lesson #2: Build Buy-in Throughout the Organization Lesson #3: Drive Retail Revenue via Digital Lesson #4: Measurement – Start Simple Lesson #5: Select Excellent Vendors and Demand Innovation Opportunities for US Operators About Chalkline Sports Contents 1 2 3 4 5
  3. 3. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino High-growth sports betting markets present a unique opportunity for casinos, as casino patrons have a strong tendency to already wager on sports. Executive Summary 1 2 3 Consumer rapid adoption of mobile means that online sports betting, like social casino, can be a key tool for engaging customers when they are outside the casino. Customer loyalty program integration for casino + sports betting is the lynchpin for effective cross-promotion and improved marketing ROI.
  4. 4. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino The Chalkline Sports leadership team has experience integrating an online sports book into a land-based casino group. Sun International, a listed company headquartered in Johannesburg, South Africa, acquired Voltbet.com, an online sports book. The new integrated website, Sunbet.co.za, launched in November 2013 and operates today. Daniel Kustelski and Jason Foster (now founding partners at Chalkline Sports) managed the sports book from inception, successfully integrating it into casino operations at Sun International. Fast-forward to 2017 in the USA. The United States is actively considering regulated sports betting. One of the most reasonable paths forward includes leveraging existing operators—namely, casino properties and groups. Over the past four years, our team has aggregated data and experiences that we feel will inform the opportunity for regulated sports betting in the USA. Background Source: https://www.businesslive.co.za
  5. 5. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Sports Betting Grows Rapidly 478 847 1,004 1,582 2,403 R0 R500 R1,000 R1,500 R2,000 R2,500 2011 2012 2013 2014 2015 Millions South Africa Sports Betting GGR (in Rand, Millions) +48.2% 2011 – 2015 CAGR Source: Gambling outlook: 2016 – 2020 • South Africa, PWC
  6. 6. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Voltbet Leads Online Sports Betting Source: CNN.com, February 2013
  7. 7. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Strategic rationale regarding the acquisition of an online sports book and subsequent re-launch of Sunbet.co.za in 2013: “We believe that the sports betting industry in South Africa is in its infancy and offers high growth. More importantly, this acquisition provides an opportunity to gain experience in operating in an online environment.” Source: 2013 Sun International Annual Report Sun International Aquires Voltbet
  8. 8. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Casino Patrons are Sports Bettors1 65%of Casino Patrons bet on Sports in South Africa Extend new sports betting products to your existing customer base. • The value proposition is simple. Acquire NDCs for your book at a much lower CPA than your purely online competitors. and add marginal revenue to customers the casino already has. • Add “sports book” marketing personas. Including sports-specific CRM segments will allow you to quickly categorize league and team affinities. • Reach out around passion points. There were more NCAA brackets filled out than votes for the POTUS. Leverage big events to build your database. • Entertain and engage. Own the thumb of your customers with simple, mobile-first interactions to collect data and build relationships. Source: All Media Products Survey (AMPS), 2015 Pro Tip: digital marketing cross-promotion--via email, SMS and mobile app—yielded high ROI.
  9. 9. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Build Buy-In Across the Organization2 Finance Marketing Management Customer Care Success Starts in the C-Suite • Begin with the end in mind. Executive leadership must agree on overall strategy and success measures. • Identify cultural challenges early. Bricks & mortar businesses have not always welcomed online counterparts. Be active early in winning over key team members. • Build new organizational structures that promote sports book division growth. Organization marketing, operations and finance teams must be connected to the new division to ensure positive change. • Align incentives at the corporate and property levels. Make sure everyone is keeping score the right way.
  10. 10. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Use Data to Drive Retail Revenue via Digital3 Build Integrated Customer Loyalty • Loyalty programs immediately demonstrated the value of casino + sports book. Our analysis demonstrated that a significant percentage of customers earned loyalty points on casino and sports betting play, and the feedback on this integration was uniformly positive from MVPs. • New depositing customers provide retail opportunities. Registration with a sports book requires a postal code that can be used to determine proximity to a property. Include the casino in the online Welcome Process. • Cross-match data sets to build segments. Regularly scanning your casino and sports book databases allows you to identify customers that can be migrated into higher value categories. • Track and target across devices and locations. Ad technology can enable customized offer targeting when the bettor is located near a casino or retail location. Pro Tip: when it came to identifying casino opportunies for sports bettors, our experience and data sets demonstrated significantly better correlations for certain casino games over others.
  11. 11. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Measurement: Start Simple4 Educate the Organization Around Metrics • Communicate sports book progress from the top. If it’s important, measure it. Incorporate sports book reporting at the top corporate level to promote visibility. • Recognize unique metrics. Each corporate division or property will have their own goals, and even retail and mobile sports books will have different success measures. • Find ways to promote team wins. Cross-promotions from casino to sports book or vice- versa provide a great example of the metrics required to build a long-term organizational success. • Measure mobile first. It’s your future.
  12. 12. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Select Excellent Vendors & Demand Innovation5 Focus on YOUR Core Competency • Define clear requirements for your business goals. The best software suppliers will be force-multipliers for your sports betting division, and should understand your needs and opportunities. • Partner with vendors that empower you to leverage your competitive differentiators. Sports books compete on offers & promotions, loyalty & bonus systems, UX design, and customer care. What makes you different? Your vendor must help you amplify your strong suits. • Think about vendors in 3-5 year time horizons. Look ahead at emerging consumer trends and think about the needs of your future customers. More mobile? More social? More data-driven? Use these trends to inform your decision. Pro Tip: As you define your path for buy, build or partner for sports book software, critically assess your ability to build and maintain rapidly changing technology.
  13. 13. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Start identifying sports bettors in your loyalty program today. Sports-based games and interactions are legal ways to start engaging customers…and to identify potential new casino customers at the same time. Connect with customers in ways that reflect consumer trends. Start with mobile, but complement digital efforts with live events that attract Millennials. Casinos have a unique opportunity to deliver compelling mobile AND in-venue experiences. Build marketing programs and measurement to meet the opportunity. Season-long sports marketing campaigns and sport-focused live events can kick things off as casinos start building simple success metrics and integrating sports products into loyalty programs. Opportunities for US Operators US states have Proposed Sports Betting Legislation (as of July 2017) 40 11 1 2 3 US States have Commercial Casinos25M Americans placed a bet last year (American Gaming Association) $150B Data Supports the Opportunity Amount Americans wagered last year (American Gaming Association)
  14. 14. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino Economic Impact of Legalized Sports Betting American Gaming Association >> Follow American Gaming Association on Twitter Economic Impact of New Jersey’s Online Gaming: Lessons Learned iDevelopment and Economic Association >> Visit iDEAGrowth.org Online Gaming from Land-Based Perspective: Observing 15th Anniversary of SIGHT (Note: there are two parts to this resource.) Spectrum Gaming Group >> Follow Spectrum Gaming Group on Twitter How to Legalize Sports Betting Daniel Wallach >> Follow Daniel on Twitter Sports Betting Lite – An Opportunity to Fill in the US Gambling Sector Ewa Bakun >> Follow Ewa on Twitter Additional Resources
  15. 15. www.chalklinesports.com 5 Lessons Learned: Integrating an Online Sports Book into a Land-based Casino The Chalkline team has operated sports books in Africa and North America and built personalized marketing automation tools with actionable business intelligence for 15+ years. Chalkline Sports’ turnkey marketing automation platform empowers operators to: Acquire new customers throughout the event lifecycle Convert single bets into loyal customers Drive greater customer lifetime value Chalkline is built to bridge affiliate and loyalty programs, amortizing customer acquisition costs across an ever-increasing customer lifetime value. About Chalkline Sports Learn More About Chalkline Sports
  16. 16. Connect with Chalkline www.chalklinesports.com hello@chalklinesports.com @ChalkLineSports View all of Chalkline Sports’ Industry Intelligence

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