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Illinois And The Issue Of Remote Registration

There was a method to the madness in Illinois, even if the reality of life during the pandemic somewhat put paid to the legislature’s initial plans.

When Gov. JB Pritzker pushed through the bill to allow sports betting in the state in June 2019, the intention was to create an 18-month window for land-based operators to establish operations ahead of the licensing of three pure-play online operations at the start of 2022.

Such was the plan at least, However, come early 2020 and the onset of a pandemic which was set to close land-based gaming venues for the foreseeable future, the authorities in Illinois suspended the in-person registration requirement.

That suspension expired at the beginning of April but it was enough time to give a taste of what mobile registrations could mean when it comes to the handle generated in the state.

The latest data for Illinois in March shows it was the biggest state behind New Jersey with a handle up to $633.6m, helped of course by March Madness in a state which has a rich history of fanaticism for basketball. Sports-betting GGR came in at $44.3m, equating to a 7% hold.

The test, however, comes in the next few months after the in-person restoration requirement was reinstated in early April to coincide with the reopening of the state’s casinos. The commentary during the recent first-quarter earnings season is instructive in terms of understanding what has happened in Illinois as well as giving a hint as to what might happen next.

An indication of how much effort was put into the player recruitment drive in the last weeks – and even hours – of mobile registration came from Penn National Gaming when it spoke about its efforts with the Barstool Sportsbook as the clock wound down in early April.

The Barstool app was only launched in the state in early March and in the first 30 days until April 4, the company signed up 54.7k registrations which flowed through to 38.9k first-time depositors and $6.5m in GGR.

Jay Snowden, CEO at Penn National, said the launch was “just ahead, thank goodness, of the return of in-person registration.”

“The initial results for the first 30 days of operation exceeded our expectations thanks in part to the loyal following of Stoolies in the Chicagoland area.”

The push to get Stoolies to sign up then went into overdrive in the 36 hours before the current came down on mobile registration as Barstool initiated a “last chase” social media marketing campaign that pulled in a further 20k new registrants, 13k new FTDs, and 10k who opted into a free $100 bet promotion. Snowden said the power of Barstool’s social media reach was “on full display.”.

Penn of course is in a better position than most when it comes to in-person registration with three properties in the state, including the Hollywood Casino Aurora in the Chicago suburbs.

Others are not quite as well-placed. Market leaders DraftKings with the Casino Queen in East St Louis, and FanDuel, through its partnership with Boyd’s Par-A-Dice property in East Peoria, are both located far away from the Chicago metro area.

In fact, one company that is well-placed both geographically and in terms of market position is the BetRivers brand operated by Rush Street Gaming. Partnered with its parent Rivers Casino, Des Plaines, which is situated right next to O’Hare airport and less than 20 miles from downtown Chicago, BetRivers has the brand recognition that comes from having been a staple of the Chicago gaming scene for a decade.

No surprise, then, that BetRivers was third in the mobile handle league table in March with 15.7% share or $95.7m of the handle. This compares with DraftKings on 33.5% and FanDuel on 32% while Barstool generated only 7.8% of the total handle of $609m for the month.

While DraftKings CEO Jason Robins said on his company’s first-quarter earnings call that he hoped the company would be able to retain its audience – and frankly it will need to – BetRivers is in a slightly better position. As CEO of Rush Street Interactive Richard Schwartz said on his company’s own earnings call, any players that might want to open another account or simply switch to another operator will from now on have to be registered in a casino.

It means that at least for the rest of this year, while it is unlikely that the market share position will change much, the potential is there for BetRivers to pick up more of whatever new trade that does want to get some of the action, particularly if they are in the Chicagoland area. The other threat, potentially, in Chicago is the upcoming launch of a barstool sportsbook at Penn National’s Ameristar Casino in East Chicago, just over the state line in Indiana.

But the potential for leakage of the handle, GGR, and effectively tax revenues from Illinois to Indiana is, as they say, a question for another time. Suffice it to say, going by the figures for the last-minute mobile registration push, Dave Portnoy and his Stoolies have a large following in the area and it seems, going by what Penn says about their retail sports-betting operations in other states, that the audience is willing to go find its Barstool fund wherever they can find it.

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