Online betting companies are kicking off a Super Bowl ad blitz

What was once a niche sector in Las Vegas has grown into a national mega-business that people can enjoy from their living rooms — and the advertising dollars have followed.

Transcript

MICHEL MARTIN, HOST:

It's Super Bowl Sunday, and more than 100 million viewers are expected to tune in to watch the Cincinnati Bengals face off against the Los Angeles Rams. But those fans will be seeing much more than just football. They'll also be watching the widely celebrated Super Bowl TV ads. So we're going to start today by talking about those ads, two kinds in particular. We'll touch on the big push around cryptocurrency and NFTs in a minute, but first, let's talk about sports betting companies. You're going to see a lot of those ads.

The sports gambling industry has exploded in the last four years, and operators are now racing to get as many customers on their platforms as quickly as possible. Some are worried about this trend. New York Attorney General Letitia James last week issued an alert urging consumers to watch out for possibly deceptive or misleading ads from betting companies.

NPR's Joe Hernandez has been looking into the rise of sports betting, and he is with us now to tell us more. Joe, welcome. Thanks so much for joining us.

JOE HERNANDEZ, BYLINE: Oh, thank you.

MARTIN: It seems like even before the Super Bowl, we've been seeing a lot of TV ads for sports gambling companies recently. Why is that?

HERNANDEZ: Yeah. This goes back to 2018, when the Supreme Court handed down a decision that revoked the national federal ban on sports betting outside of Nevada. And that really opened the floodgates for states to get in on legalized sports betting. Now there are 30 states and Washington, D.C., that have sports betting, and more are on the way. And it's so - it's a kind of young industry, but it's growing very rapidly, and more states are joining in every year. So sportsbooks are looking at this trend and saying they want to get as many customers as possible as quickly as they can, so they're spending big on advertising right now.

MARTIN: How much are they spending? How much money are these betting companies spending on advertising?

HERNANDEZ: Millions of dollars, sometimes even hundreds of millions. The research firm MediaRadar estimated that the gambling industry as a whole, which includes sportsbooks, spent $488 million on advertising between November 2020 and November '21. I spoke with Adam Candee. He's managing editor of the trade publication Legal Sports Report, and he was telling me that sportsbooks are looking at this as the moment to spend a boatload of money on advertising.

ADAM CANDEE: It is happening in the here and now, moment to moment as they compete for customers. That is because this is essentially a new industry that is rising up from the ground, and you have early movers who are heavily capitalized trying to acquire as much market share as they possibly can.

HERNANDEZ: And so this is sort of like the business model that Amazon and other companies had, which is, you're willing to lose a little bit of money at the outset while you're building up your customer base, and then you hope those people stay with you in the long run and help you make that money back and earn even more.

MARTIN: So how big are these companies going on advertising for the Super Bowl? I mean, I guess I'm going to see a lot of sports betting ads and fewer chip ads (laughter).

HERNANDEZ: (Laughter) I think we're going to see a lot of sports betting ads in our lives generally for the years to come. They're going to be spending millions again. Three of these companies, which are sort of the top-tier partners of the NFL, are Caesars Sportsbook, DraftKings and FanDuel. FanDuel is rolling out ads before the game and some local in-game ads during the Super Bowl. Caesars and DraftKings are going to be even bigger. They're airing national in-game spots. And NBC, which is broadcasting the Super Bowl, said some of those in-game spots were going for as much as $7 million for 30 seconds of airtime, which sounds like a lot of money, but over 100 million people are expected to watch the Super Bowl. And this is not just some random assortment of people; it's sports fans. So sportsbooks are hoping to sell themselves at this crucial moment.

MARTIN: You know, I just think for people of a certain age, this is quite jarring because the major sports leagues used to be very much against sports betting. And, you know, some of the major scandals in sports had to do with gambling. So now they're partnering with sports betting companies. What's been going on there?

HERNANDEZ: Yeah. It's been a huge reversal for pro sports. Sports leagues, including the NFL, were against sports betting for many years, and they were worried in part about cheating and match-fixing. And even NFL Commissioner Roger Goodell once called gambling the No. 1 threat to the integrity of pro football. But when the Supreme Court decision came down, they sort of had no choice, and it's now legal in many states. And the NFL has embraced it, and they've even partnered with some of these sportsbooks. So it appears to be a sign that this industry is only growing larger and will become even more ubiquitous in the years to come.

MARTIN: That was NPR's Joe Hernandez. Joe, thanks for your reporting.

HERNANDEZ: You're welcome. Transcript provided by NPR, Copyright NPR.