Penn National CEO Jay Snowden says that shortly after the U.S. Supreme Court opened the door in May 2018 for all states to legalize sports betting, he and his colleagues began to observe the New Jersey marketplace for that activity.
“We saw the FanDuels and DraftKings of the world really get off to a fast start there, and we believed a big part of it was they were a sports-relevant brand as well as having an audience of fantasy sports players that they could then convert into sports bettors,” Snowden said at last week’s SBC Digital Summit North America that was held online due to the COVID-19 pandemic.
“The casino companies were off to slower start,” Snowden told panel host Roger Gros of Global Gaming Business magazine. “Many of them were leading with their casino brands that maybe didn’t resonate with a younger sports betting audience.
“They hear Caesars or MGM, and they think of Las Vegas, of mega-resort entertainment — not necessarily sports betting,” he added. “So we wanted to make sure once we launched that we would have a partner that was brand-relevant.”
Having acquired Pinnacle Entertainment in 2018 for $2.8 billion led to Penn National offering gambling in an industry-leading 19 states, many of which have legalized sports betting or are considering that option.
A “two-fold” strategy, Snowden said, has produced partnerships with DraftKings, PointsBet, theScore, FOX Bet, and others while also saving some “skins” for Penn National.
The “one thing missing”
“The one thing we were missing was a brand to lead with and an audience to market to in the sports betting space,” Snowden said, adding casino customers tend to be age 45-plus while sports betting skews age 21-45.
Enter Barstool Sports, a sometimes controversial platform that has built an extremely loyal following of millions, with sports betting as a core factor in that following.
That partnership was announced in January, but there was no great urgency to launch a sports betting app immediately, Snowden said — a fact that became even more evident once major sports leagues in the U.S. shut down amid the pandemic in mid-March.
Penn National’s vision is for an app that allows fans not only to bet on a Yankees-Red Sox game, Snowden said, but also see what Barstool personalities such as founder Dave Portnoy or “Big Cat” are predicting. That allows fans of the brand to bet with, or against, those personalities.
“We want our app audience to be entertained — you don’t just go there to bet on games,” Snowden said.
Penn National casino sportsbooks around the country will begin a rebranding to Barstool in the coming months, Snowden said. A key component of that will be Barstool’s stars holding pre-game and post-game parties at those sportsbooks whenever major sporting events roll around.
That benefits the casinos because they will find a new, younger audience coming through their doors thanks to Barstool.
The plan is for multi-day casino hotel packages to be marketed to Barstool customers willing to pay a premium to rub shoulders with Portnoy and his team.
As for the controversies that periodically pop up with Barstool, Snowden appeared fully at ease with the partnership.
“Obviously we spent a lot of time doing our diligence,” Snowden said, describing the Barstool culture as “a mix of SportsCenter, Howard Stern, and reality television.”
With more than 15 years of commentary by Portnoy and his team still available on the internet, Snowden said it was inevitable that some of it wouldn’t age well.
“Dave has said that as times change, he looks back at things he did or said that as of today, he probably wouldn’t say,” Snowden noted. “There are attempts at humor that missed the mark, when you look back at it.”
The rise to prominence at Barstool of CEO Erika Nardini is an important sign of progress, Snowden said. “Their executive team now is 75% women,” he said. “Most people don’t know that.”
Which state “goes Barstool” first?
First up for the Barstool sports betting app in time for football this fall, Snowden said, is Pennsylvania — where Penn National owns The Meadows Racetrack and Casino in the greater Pittsburgh area and Hollywood Casino near Harrisburg.
“We want to launch one first so we can kick the tires and make sure we are living up to our customer expectations,” Snowden said. “Several [apps] do a good job, and several don’t.”
A “traveling wallet” will be a major plus, Snowden said, referring to how a New Jersey resident who works in Philadelphia doesn’t have to download two different apps to make bets.
After Pennsylvania, Snowden ticked off Illinois, Michigan, Indiana, New Jersey, and Iowa as a second wave of launches. No rebranding of a sportsbook would be needed at New Jersey’s Freehold Raceway, where Penn National is a 50% owner, because that track has yet to offer sports betting, unlike Monmouth Park and the Meadowlands Racetrack.
Online casino gaming also is spreading, and Snowden said Penn National is uniquely positioned to thrive there as well as with mobile sports betting.
“We think we can be the number one online casino market share player in the states where we operate,” Snowden said.
The months-long closing of casinos nationwide, and subsequent limited reopenings, Snowden said, inevitably will make online casino gaming more appealing. New Jersey and Pennsylvania, for instance, have been able to salvage revenue for casinos and tax dollars for residents thanks to mobile gambling options.
“States will look at this and realize that having both probably makes a lot of sense,” Snowden said.
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