By: Riley Day
Oct. 25, 2022
Photo Credit: NBC Sports
Overview of Gambling in Pro Sports
After decades of waiting, the state of Ohio moved to legalize sports betting, set to take effect in January 2023.
The Cincinnati Reds are the first major sports team in Ohio and the second MLB team to implement a brick and mortar gambling venue. The Washington Nationals were the first team to break the ice, creating a sportsbook at Nationals Park in January.
BetMGM boasts several elite sports partnerships and is actively looking to expand as more states legalize gambling. They have league-wide partnerships with the MLB, NHL, and PGA Tour. They have also landed partnerships with teams including the New York Knicks, Rangers, and Kansas City Chiefs, according to Sports Pro Media.
No sport can potentially see greater benefit from gambling than baseball. With baseball’s naturally slow pace and frequent breaks in the action, MLB’s in-game betting has worked as a great way to keep people engaged and now represents one-third of the market, as reported by the Sports Business Journal.
The Benefits
Sports gambling provides many exciting opportunities for growth in the industry, particularly for younger fans. Viewership of the MLB was down 5.7% in 2022 compared to 2019, according to a report from Forbes. Gambling could increase viewership by making the game more exciting overall, adding meaning to random at-bats and specific innings of the game.
A survey recorded by the Seton Hall Sports Poll found that 70% of Americans say they would be more likely to watch a game they bet on. The 18-29 (some states are 21+ for gambling) age range is even more likely to pay attention to games they bet on, 88% to be exact. Venue sportsbooks will ensure that people actually come to games in-person rather than watching from home. Marketing experts like Elevate say live experience is critical for Gen Z. Venue sportsbooks provide an opportunity for younger fans to hang out with friends, have a couple drinks, lay down some parlays on the game, and get back to their seats for the last couple innings.
It would be naive to fail to mention how much money big-time gambling partnerships can bring in for struggling leagues like the MLB and the NHL. It can inject much needed energy into fading sports leagues, drawing the attention of highly-coveted Gen Z. American Gaming reports that the four major sports leagues earned $4.2 billion from widely-legalized sports gambling. Besides the economic opportunity provided, gambling also generates tax revenue and creates jobs. From the same report, the MLB is projected to earn over $1 billion in projected revenue. Down the line, it will be difficult to keep teams from continuing to establish venue sportsbooks as there is simply too much money at stake not to.
The Drawbacks
Sports gambling is considered to be a vice by many sports fans, particularly those from the older generation. This could raise issues for the MLB, where 44% of “avid fans” are over the age of 45, according to Statista.
Credit: Statista.com
Baseball “purists,” people who go to the ballpark strictly to watch the game, could potentially be turned off by venue sportsbooks. Not to mention the “ethical and moral concerns raised when considering baseball’s murky history with regard to the issue of gambling,” Forbes states. If baseball is actively promoting gambling and partnering with companies like BetMGM to make billions of dollars, we could see something similar to the “Black Sox” scandal occur— when the 1919 World Series was fixed by players in exchange for receiving money from Arnold Rothstein’s gambling syndicate.
The Reality
Some might argue it is about time to acknowledge the writing on the wall. Is sports gambling so different from partnerships with Anheuser-Busch and Corona worth $10 million a year? The MLB also announced on Tuesday that it inked a three-year/$30.5 million deal with CBD brand, Charlotte’s Web, becoming the first major sports league to sign a CBD sponsor, according to Cannabis Science Tech.
The next logical step is for individual teams to follow suit, signing partnerships with both CBD and gambling companies. We are already beginning to see progress on this front. Since becoming the MLB’s official gambling partner, BetMGM has partnered with the Boston Red Sox, Detroit Tigers, Los Angeles Dodgers, New York Mets, New York Yankees, Houston Astros and Washington Nationals.
The Future
As additional states legalize gambling, expect both corporate partnerships and brick-and-mortar venues to significantly increase in number until they are a staple of MLB ballparks. Major dollars will be spent on product promotion and signage at ballparks as well. The relationship will be mutually beneficial, with both sides seeing an increase in product awareness and revenue.
Conclusion
The MLB has clearly established itself as the main trailblazer of the four professional sports leagues. Within the last couple years, it has signed large partnership deals with companies representing products most leagues are afraid to touch: gambling and CBD. These partnerships were mostly agreed upon, as a result of viewership numbers being down 5.7% in 2022 and the MLB’s struggle to stay in touch with fans of the younger generation. New rules changes have been instituted to make the game quicker, more exciting, and more engaging. In-game betting should assist with that.