888 has pledged to target the “unsexy sweet spot” of male iGaming customers aged 39 and over as it continues its expansion in the US via the SI Sportsbook brand.
Speaking at the operator’s Capital Markets Day in London this week, 888 chief strategy officer Vaughan Lewis pointed out that although iGaming is currently only available in six US states, the revenue potential of the vertical in each of those states is around three times greater than that of online sports betting.
As a result, the US iGaming market is nearly as big in revenue terms as the online sports betting market, despite being available in just a handful of states, compared to 22 for OSB.
That fact lies at the heart of 888’s ‘betting 2.0’ business strategy, which will see the operator increase the number of targeted promotions in states with legalised iGaming in order to capitalise on the vertical.
The business will also be “laser focused on a key cohort of the older male demographic,” Lewis added.
“The older male demographic are worth more; they spend four to six times more than the ultra-competitive, younger demographics. And they also love casino,” he said.
The decision comes after several years of intense – and costly – competition in US online sports betting market, the results of which have seen four major operators dominate, while just one (FanDuel) has been able to demonstrate a convincing turn towards full-year profitability.
888 chief strategy officer Vaughan Lewis: “It’s become clear to us that the intense competition in sports betting and the dominance of the top four brands means that it will be very difficult to deliver positive returns without evolving our plan.”
888 said its original plan was to build a nationwide sports-led operation in 12 to 15 states, but it has since had to dial back on that strategy.
“It’s become clear to us that the intense competition in sports betting and the dominance of the top four brands means that it will be very difficult to deliver positive returns without evolving our plan,” said Lewis.
Indeed, 888 has used its experience in the US to date to help determine its evolved plan moving forwards.
“With just over a year of operations under our belt with the Sports Illustrated sports brand, we now have really clear data about how we can convert players, what they play, what makes them stay, what are the different values between the different cohorts. And that data gives us real confidence in our evolved plan,” added Lewis.
The future of 888’s US presence remains to be seen, however. Lewis explained that while the US is seen as an important growth market, it remains part of a portfolio of growth markets that are competing with each other for investment.
“So across that portfolio of growth markets, we will operate at around breakeven,” said Lewis. “While we continue to invest with confidence in the US, we are going to deliver positive returns by really focusing on what we’re good at and where our brand cuts through.”
888’s continued presence in North America may now be reliant on the successful execution of its ‘betting 2.0’ strategy.