Chris Grove: Context, brand, and entertainment playing factors in sports betting
Sharpr is a weekly newsletter covering the intersection of esports, betting, and Gen Z
Hi everyone, Cody here.
I’ve been listening to more podcasts recently and came across an episode of Business of Betting with Chris Grove that I knew would be worth the time, and it was.
The podcast covered a ton of themes I’m personally interested in and felt compelled to carve out some room to summarize the episode with some added thoughts sprinkled in for my audience.
Chris Grove: Context, brand, and entertainment playing factors in sports betting
If you’re a participant in the regulated gambling industry, you’ve probably heard the name Chris Grove before – either in national press coverage, speaking at sports betting conferences, or through his work at research firm Eilers & Krejcik.
Recently, the Acies Investments co-founder sat down with host Jason Trost on the Business of Betting Podcast to run through some current and forward-looking themes in the US industry. Grove’s commentary is always well worth your time, so I decided to highlight a few key points that I thought were most interesting for my audience. Let’s break it down.
#1 Context is everything
Grove says that the “context that you present gambling to people within matters tremendously,” especially for a younger demographic.
“There always was this perception about esports fans that they weren’t interested in gambling – they would never play slot machines, they would never engage in traditional gambling.”
Using skin gambling as an example (where users wager in-game items with real-world value), he argued that 30-and-under consumers would wager billions in value as long as the surface layer and ephemera of betting “reflected the gaming context.”
Sharpr thoughts: There’s something to be said about repackaging a mature category in a fresh and familiar context to reach a consumer with different entertainment preferences. Let’s look at some examples that fit within the gaming context specifically.
Just last year, we became privy to a slate of online casinos developing products and marketing based on Roblox’s IP to present gambling in a visual context its target audience can digest.
Another example is ‘Duel Arena,’ the peer-to-peer casino game Rollbit released last year that was purposefully designed to look and feel like the popular MMORPG video game RuneScape.
The throughline here is leveraging a context that appeals to a younger consumer who is less engaged in mainstream and sports culture, but is heavily invested in gaming and digital culture.
#2 Entertainment value in betting
One point I’ve observed Grove endorse over the last year or so is this idea of gambling feeling more like entertainment, or even “a game.”
“When you start making sports betting [look] more like a casual mobile game, or position it closer to entertainment than betting, maybe you can start drawing more from the non-gambling wallet of a typical consumer,” Grove told JohnWallStreet in November 2023.
He also contributed to Eilers & Krejcik’s recent report ‘Why We Think a Gambling Company Should Buy Marvel Snap,’ which speaks to in part what the betting industry can draw from video games (you can read more about here – I highly recommend it).
On the podcast, Grove says that the “current sports betting product requires a substantial context shift” for consumers who are approaching gambling expecting entertainment or a video game-like experience.
Same-game parlays, in his view, are “the closest we have to a game” in the US sports betting experience. He added that operators will start rethinking the gambling product as something that is more entertaining with higher volatility versus what he describes as “an approachable spreadsheet” as the primary experience.
Sharpr thoughts: Entertainment value is an overlooked piece of the online betting experience.
In my last story, I asked my readers what would happen if you stripped away the ability to win money betting on sports or playing online casino. Is the current product set entertaining enough on-face for customers to continue spending their time playing them? If you think the answer is no, that’s something worth thinking about.
What Grove notes in the podcast, and I’ve written about in the past, is that there is a tremendous opportunity to elevate the design, UX, and entertainment value in betting to enhance the overall experience.
If same-game parlays are any indication, a more entertaining product would mean higher engagement and access to a broader audience.
#3 Different strokes for different folks
Grove notes how a percentage of the sports betting audience plays for the “strategic engagement” and “the challenge.”
“The “umph” is in the analysis, is in the preparation, is in the exercising of some level of control over what is fundamentally a random underlying event.”
“Far more US consumers,” he believes, are “not approaching sports betting in that way.” Instead, Grove says they are looking for an add-on to watching the game, building on their existing social experience with friends, and picking up their phone to kill a few minutes.
“[Betting] is nowhere near as accessible as it could be if you put a product in front of people that was more fun on-face as opposed to you having to generate the fun through deep engagement with everything surrounding the product, not the product itself, not the game itself.”
Grove says it’s no coincidence that within the current online betting duopoly between DraftKings and FanDuel is also the broadest product and brand set (think: OSB, poker, fantasy, casino, horse racing, etc).
Sharpr thoughts: I’ve always had this feeling that the industry over-indexes on the sports betting customer that’s only there for the value and transaction.
As far as I can tell, that customer and their behavior is viewed as the north star for what all sports bettors want and prioritize. And as someone running comms for a challenger brand in the space, I can personally attest that it’s very difficult to convince most stakeholders and reporters that there is a path forward in betting that deviates from lavish promotions or marginally better odds.
Clearly that value-focused cohort makes up a measurable part of the customer base, and while the primary OSB offering is satisfying for the majority of them, there is another segment looking for entertainment value, social connectivity, and perhaps other things that the current marketplace doesn’t provide.
#4 Brand and form factor
Form factor across product and brand will be a major playing factor in the future of online betting, Grove says.
“I don’t think any of these brands are elastic enough to meet, satisfy, and resonate with the full demographic breadth and full array of consumer needs.”
He reiterates that while there are plenty of customers in search of the best price, there will be other qualities that drive purchasing decisions among a casual audience.
“As you start to move to the other end of that spectrum and you get to people who are looking at this more as an entertainment product, I think other factors like brand affinity – what brand do I think actually reflects me and who I think about myself as a person?”
Grove insists that “multi-brand” strategies – where one top company oversees different commercial brands under it – will allow operators to appeal and resonate with a broader audience (think: DraftKings and Golden Nugget).
“I think there is an intense potential for brand dilution, consumer confusion if you try to be too many things to too many people,” he added, insisting the multi-product and multi-brand would be a net positive.
“Allowing those individual brands to have individual identities but still benefit from all the efficiencies of [the top company] and benefitting from the opportunity to allow consumers who do want different things at different points in their lives – whether it’s a fundamental different experience or a different price point, or a different brand and how it resonates with them.”
Sharpr thoughts: Brand affinity is a curiously absent topic in the sports betting industry.
Loyalty is thought to be a fallacy in online betting, and for a value customer who switches between three-to-four apps on their phones in search of the best odds and promotions, perhaps it is.
But in consumer product categories, and especially those categories where most products are perceived as the same by consumers, brand equity is a key form of differentiation and loyalty. Look no further than Liquid Death to see the merits of this strategy.
Just as Grove points out how different airlines “still get you from A to B,” every sports betting app allows you to place a bet. Through that lens, a distinct brand and personality can meaningfully differentiate a product in the marketplace, especially in the current marketplace of sports brands creating sports content for sports fans.
What I’ve always found curious is how sports betting isn’t often thought of in the context of consumer products and the well-understood dynamics that have historically defined category leaders – the importance of brand equity being chief among them.
While there will always be value customers in search of the best odds or cheapest flight, there’s seemingly open range for a new brand to serve a specific customer base with culturally relevant content and entertainment.
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I really like the idea of a refresh and revisit of traditionally accepted ideas about the space.
As in music, the refreshed revisit of a classic style is a real interest getter and helps rebrand and better yet set a new audience perception of something they feel they know.