Residents of legal sports betting states can confirm: Sportsbook ads seem to be everywhere. Kentuckians, too, will soon face the deluge of messaging from the likes of Caesars Sportsbook, FanDuel and DraftKings.
But the analysts at Eilers & Krejcik Gaming expect the sportsbooks in the Kentucky sports betting industry to spend less on advertising than in other similar-sized markets. As the main reason behind the prediction, in a market summary provided to PlayKentucky, EKG cites Kentucky’s six neighboring states where sports betting is already legal as an opportunity for “shared media market cost savings.”
In layman’s terms, that means there are overlaps in local TV viewing areas. Viewers on the Kentucky side of border areas see the same commercials as viewers in neighboring legal betting states.
Kentucky residents already seeing ads and using online sportsbooks
For example, Kentucky’s third-largest metropolitan area, Northern Kentucky, borders Cincinnati. Residents of Northern Kentucky cities Covington, Florence, Ft. Thomas and surrounding areas have seen ads for Ohio’s sportsbooks already, following the launch of legal sports betting there in January.
Louisville, of course, borders Indiana where sports betting has been legal since 2019. Kentuckians in these areas who are particularly interested in sports betting (and in doing it legally) have likely crossed the border to bet on sports, either occasionally or regularly.
The vast majority of sports bets in the US are placed using mobile apps like FanDuel Sportsbook and DraftKings Sportsbook, so it’s likely that many Kentuckians already have and use the apps. When you consider other areas outside of Nashville, TN and Evansville, IN, plus Paducah and other border cities, you can see why there would be less need for Kentucky online sportsbooks to dump loads of new money into advertising in the Bluegrass State.
Skyrocketing ad spending trends could be returning to earth
The largest sportsbook operators spend a lot of money on advertising. And that amount has grown each year as they compete to acquire and retain customers in new and existing markets. In 2022, the gambling industry spent $866 million on media advertising, up 40% from the previous year, according to the American Gaming Association.
FanDuel, Caesars Sportsbook and DraftKings have historically spent the most money on marketing. The big three online sportsbooks accounted for about 75% of TV ad impressions in 2021, according to a 2022 report.
As markets mature and sportsbook operators feel the need to be profitable, overall ad spending might decline. Last year, Caesars CEO Tom Reeg said the company would reduce ad spending. BetMGM Chief Executive Adam Greenblatt indicated the same plan for that company in an interview with Wall Street Journal.
Nonetheless, Kentucky won’t be spared from the advertising blitz that will happen at launch time. Most sportsbook ad spending happens in Q4 when the NFL season kicks off. Kentucky’s governor and gambling regulators aim to have sportsbook apps live by the beginning of the NFL season, which starts in September.
