Brackets Neither Busted Nor Bolstered By Spread Of Legal Sports Betting

The March Madness pool remains a national pastime despite the alternative options
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Cannibalization is perpetually a subject of concern in the gambling industry.

Brick-and-mortar casinos are worried about the “threat” of online casinos. Similar fears have been bandied about concerning online poker for some two decades now, pushed most prominently by late casino mogul Sheldon Adelson. And with the increasing availability of legal sports betting, some in other sports gambling realms, such as daily fantasy, have pondered the possibility of a negative impact.

This was perhaps best exemplified by Fantasy Sports Gaming Association President Peter Schoenke relating in 2019, “A lot of people have come to me and said, ‘So sports betting is legal now — fantasy is over, right?’”

No, fantasy is not over. And brick-and-mortar revenue is not down. Gambling expenditures, it seems, are not a zero-sum game.

That said, time in the day is limited, and for a lot of action-seekers, something’s gotta give.

So this week in particular, with March Madness tipping off on either Tuesday or Thursday depending on your perspective, it’s fair to wonder: Are NCAA bracket pools that “something” for those who’ve newly developed a passion for single-game betting?

‘It takes no effort to fill out a bracket’

For many Americans, the March Madness bracket pool is the first form of gambling they ever participated in. And when you’re in high school and that’s just about the only game in town (US Bets is not condoning underage gambling nor participation in unregulated bracket pools, but let’s not pretend these things aren’t happening), sweating out your $5 entry for three weeks can be thrilling.

But when it’s far from the only option for action, and when each game represents a mere 1/63rd of what is effectively a slow-developing parlay bet, it seems natural that lots of gamblers would gravitate away from the brackets and toward the quicker fixes of pre-game wagers, in-game bets, player props, single-game parlays, and so forth.

Some do, certainly. But the signs are pointing toward the bracket business humming along just fine since states other than Nevada have added legal sports betting beginning in 2018.

“I wouldn’t say bracket pool participation has changed much in either direction,” said John Cranston, the founder and website manager of TournamentPools.com, a Colorado-based company that provides hosting services for a variety of pool-style games. “People like to try to outsmart their friends, or prove who knows more about football or basketball or whatever. I doubt that’s going to change. Some people want to bet, they want to be serious about it, they’re going to the sportsbook — and they’re going to do this. And other people are not serious and they just want to have fun with their friends or their officemates.”

US Bets also spoke to a Florida-based individual who, until recently, operated a multi-sport pool business for decades. This former pool organizer, who requested anonymity, echoed the sentiments expressed by Cranston.

“I think people are still playing bracket pools in about the same numbers that they used to — largely because it takes no effort to fill out a bracket,” the pool manager said. “I would estimate 20 percent of people who do bracket pools are also doing sports betting. And that hasn’t really changed.

“They do a bracket pool because it’s fun. Sports betting can be a solo occupation. Bracket pools, it’s fun to talk about how your bracket is doing. People want to play pools, whether they’re serious gamblers or not. You invest a small amount, and you can win a lot.”

AGA analysis

The annual March Madness wagering projections released by the American Gaming Association fall in line with the more anecdotal evidence provided by those in the pool business.

The AGA released this year’s survey results after the bracket reveal on Sunday, and found that the numbers of adults planning to both wager in some form on March Madness and to specifically enter at least one bracket pool are almost identical to the 2021 findings, despite tens of millions more Americans having access to legal sports betting now than was the case a year ago.

In 2021, 47.4 million were projected to gamble on March Madness, including 36.7 million filling out a bracket. For 2022, the numbers are 45 million and 36.5 million, respectively. Factoring in margin for error in survey results, there’s essentially no change from last year to this year.

However, going back to 2019 (remember, there was no March Madness tournament in 2020 due to COVID-19), when the spread of legal betting was still in its infancy, we can see a moderate change in bracket habits. Consistent with 2021 and 2022, it was estimated that 47 million American adults would wager in some form in 2019. But the bracket participation estimate was 40 million, just different enough from the 36.5-36.7 million of the 2020s to raise half an eyebrow.

Still, the number of people planning to place a Vegas-style sports bet went up 72% from 2019 to 2021, with 73.6 million more Americans in 14 additional jurisdictions having access in the latter year. In light of that, the 9% drop-off in predicted bracket play over the same time period, while not insignificant, can hardly be categorized as major cannibalization. And the bracket play expectations for 2022 haven’t changed from 2021 despite another 29 million Americans living in legal sports betting states added in the past year.

If there’s a tournament, there will be Madness

By a vast margin, the biggest recent threat to Cranston’s pool hosting business was COVID, not legal sports betting.

“Year after year, we’ve just kept cruising along, steadily growing,” Cranston said. “With March Madness being canceled two years ago, that was a setback for us. The 2020 year, we went down in revenue — basketball revenue basically went to zero. COVID hit us; there was an obvious impact from that. But really we haven’t seen anything with the expansion of legal gambling.”

Cranston added, “I’ve never heard anyone say, ‘No, we’re not going to do our pool this year because everyone’s betting on DraftKings.’ But then again, the people who decide not to do it usually don’t talk to us about it.”

Surely, some have moved on from bracket pools due to a preference for betting against the house. But there’s no evidence to suggest the office pool is in decline. For countless Americans who like to gamble on sports casually, single-game sports betting simply gives them one more outlet to keep the sweat going after their brackets have been busted.

Photo: Shutterstock

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