Many are concerned about some of the numbers reported by Mississippi for sports betting in November, but all can be explained when investigating a little more in-depth
Recently, the state of Mississippi released its figures on sports betting for November, and from afar, they do not look very promising. However, upon further examination, they simply show the perils of localization of the sports betting industry and the impact that mobile betting can have on overall revenues.
Handle up, revenue down
Let’s start with the good news – handle in November was up 17.4% over October to almost $57 Million. With football and basketball in full swing, these are excellent numbers for the state. However, despite the increase in the number of bets in the state, the revenue month-over-month figure was down almost 70% to only $3.8 Million.
Again, from a distance, these numbers look off for some reason. When you start to dig into them, you realize that there was a major betting anomaly in the state in October. Perhaps you remember the news about a Houston mattress salesman who needed to make some major bets on the Astros World Series run to cover a promotion he made during the regular season. To counteract the potential free mattresses he was going to have to award buyers, Jim “Mattress Mack” McIngvale made over 10 Million in bets at sportsbooks. McIngvale, a Mississippi native, found some action from the legal sportsbooks in the state. He claims to have lost 13 million in total across his bets on the Astros (which we assume he was fine with, especially for the publicity he gained from the stunt). This had a major impact on the revenue numbers for November.
Sportsbooks in Mississippi are not able to spread the risk if one sports or team becomes very popular or goes on a great winning streak. This is true in Mississippi as there has been a lot of betting on nearby LSU in college football, which has been steamrolling teams on their way to the National Championship game.
Mobile – good for business if done right
Another issue facing the Mississippi sports betting market is the role that mobile betting has in the industry. Currently, the only way for bettors to use a mobile app for sports betting in the state is to be inside one of the land-based facilities that have a sportsbook. This ringfencing of the apps is a major limitation to the growth of the numbers in Mississippi. One can only imagine how much higher the handle numbers would be if players did not have to leave their houses and travel to a physical sportsbook to make their wagers.
Mobile sports betting is crucial to the success of in-play betting, which will be a growing segment of the market across the United States. These bets require someone to be able to access odds very quickly and are definitely being hindered in states like Mississippi. With the mobile betting market making up more than 70% of the handle in many states and over 80% in New Jersey, lawmakers should find a way to expand the offering in Mississippi. A measure to allow mobile betting outside of physical sportsbook locations was voted down in 2019, but no doubt will be reintroduced during the 2020 legislative session.
Take a step back to see the success
Everyone is excited to watch the growth of sports betting in states where it has been legalized, but the scrutiny placed on monthly figures is unwarranted. The bottom line is that over a long period of time, concerning numbers like those in November in Mississippi is nothing more than a blip on the screen. If a betting industry is set up properly from the outset, then it should thrive over the long-term. This is why the changes regarding mobile sports betting need to be addressed sooner than later in Mississippi, or else the numbers will look bad even when pulling back from the month-by-month view.