Decline in sports betting ads threatens regulated market, AGA warns
In the US, sports betting operators are spending less on advertising, according to a recent study by the American Gaming Association (AGA).
The impressive surge in sports betting advertising began in 2020. As states began regulating the industry, spending tripled from $100 million to $300 million in one year, while the number of ads grew from 250,000 to 750,000. The following year, growth accelerated: by 2021, spending nearly reached $1 billion, and the total number of TV advertising units exceeded 2 million.
However, this rapid growth was short-lived. By 2022, the number of ads began to decline, and although spending remained stable, this was primarily due to the rising cost of advertising.
In 2023 and 2024, the decline became more pronounced. “Sports betting advertising volume across all channels was down 9 percent in 2024 and is down 27 percent from 2021,” reports the AGA. The volume has also been impacted: “Sports betting television advertising volume fell 17 percent in 2024 and decreased by 44 percent from 2021.”
What’s causing this decline?
There are several reasons. With sports betting now legal in 38 states, the initial rush to acquire new customers has slowed. AGA explains, “As sports betting has expanded into new states, legal operators often launch advertising campaigns to raise awareness of legal sportsbooks and capture market share. Over time, those markets mature and the level of advertising declines.”
Moreover, a recent increase in taxes may have pushed companies to limit some of their spending. In August 2024, Peter Jackson, CEO of Flutter Entertainment, explained that FanDuel intended to cut promotional and marketing expenses to offset the new tax regimes introduced in many states, with tax rates as high as 51 percent in states like New Hampshire, New York, and Rhode Island. He said: “We think that moderating the levels of generosity and reducing local marketing is the best customer option, and we have no plans to introduce a surcharge for winners.”
A key reason is the industry’s increased regulatory scrutiny and negative press, with many countries banning sports betting ads and a growing push for similar action in the US. Last year, the NFL decided, for example, to limit the amount of sports betting advertising to three ads during the Super Bowl. “We’ve put some policies in place to limit the amount of advertising for sports betting that happens in our live games,” said NFL spokesperson Alex Riethmiller. “It’s roughly one ad per quarter. All told, less than 5 percent of all in-game ads are sports betting ads.”
Consequently, the share of sports betting advertisements is considerably smaller compared to other industries. “For every sports betting advertisement on TV in 2024, there were more than four telecom/wireless commercials and 38 pharmaceutical commercials,” stated the AGA. “Sports betting’s share of total TV advertising volume was 0.4 percent in 2024, flat from the prior year, and remained lower than alcohol (0.5 percent) and was dwarfed by pharmaceuticals (13.6 percent),” explained the AGA.
AGA fears shift to unregulated market
According to the AGA, this reduction in spending on advertising for regulated sports betting operators is concerning. A recent study found that “70 percent of sports bettors primarily using offshore sites didn’t realise they were betting with unregulated sportsbooks.” Without proper promotion of regulated platforms, this number is unlikely to decrease, argues the AGA. “Advertising by legal sportsbooks plays an important role in informing consumers about legitimate betting operators and migrating those consumers to safe betting options.”
