PointsBet posted its best-ever NJ sports betting handle share in Q4 on the backs of some high-staking customers.
The operator hit a 13.5% handle share for the three months to December 31, up from 6.5% the previous quarter and 8.7% the quarter before that. PointsBet CEO Sam Swannell was quick to point out the inflated number was largely down to some big bettors running hot.
“It’s pretty clear from our numbers that some bigger betting clients had a good run of results that resulted in our net win margins [hold] being below expectation,” Swannell said. “And when that happens, obviously, the punters are winning. They’re cashed up, and that results in a higher level of turnover.”
PointsBet New Jersey GGR was -$5.0 million on a hold of -1.1%. Swannell said PointsBet was targeting a 10% online handle share in the New Jersey sports betting market
Hot start in Illinois sports betting
The CEO also played down any concerns about long-term hold rate, saying the company expected to hit 5% or better.
Interestingly, the PointsBet figures out of Illinois also showed a business reliant on high rollers, albeit with better sporting results. For October 2020, PointsBet achieved 14.7% share of IL online handle on just 3.6% of the bets.
PointsBet noted it risk-managed clients whose average bet size is “significantly above the median.”
Illinois revenue was $9.3 million.
“We do have a very strong presence with the NBC assets in Chicago with the Bulls, the Blackhawks and the White Sox,” Swannell explained. “And if you’re watching those events, you’re going to see us integrated into their pregame shows, intra-game shows and postgame shows. So that gives us a great opportunity to maximize the NBC advantage in Chicago. And we would hope to do well in that state.”
High-roller secret in IL, NJ sports betting?
When asked about its ability to attract high-value customers, PointsBet told LSR it adopted a “premium mentality.”
“That premium mentality applies to our customers as well,” said PointsBet communications director Pat Eichner. “Versus the competition, we do feel (and have seen from our client base) that we appeal a bit more to the suit and tie, ‘more premium’ bettor, thus the average stake size.
“In terms of acquiring those Diamond-level whales, would throw kudos to our Diamond team and larger customer service/retention teams. We have dedicated Diamond managers working 24/7 that cater to those top-end clients, and we’ve received great feedback on our approach.”
Of course, the results from Illinois and NJ sports betting also highlight the problems of a high-end customer base: more volatility and potentially lower hold.
Across the whole US business, PointsBet saw handle up 482% year-on-year to $654.9 million. Gross revenues were down 2.6% to $7.9 million thanks to low hold rates, according to the financial report.