Canada: Making the right plays
Jordan Gnat, Chief Executive Officer, Playmaker Playmaker is a digital sports media company at the intersection of sports, betting, media and technology.
Now that single-event sports betting has been approved do you think that consumers will turn away from offshore betting sites and switch to legally licensed sports betting outlets?
Bettors have been betting online in Canada for decades, and Bill C-218’s passage now moves this activity into the regulated market. Tis is important to understand because it is very different from the US.
Large international operators have been servicing the grey market for a decade or more. Tese companies will be permitted to participate in the regulated market and their customers would migrate, but the key to success will be to ensure that the fan experience is the same in the regulated market as it has been in the grey market. In simple terms, everything being equal(ish), people will play in the regulated market versus the grey, and we have already seen this play out in several countries in Scandinavia where legalisation has come into play.
But, this is only a small piece of the prize. Te
recognized gambling brand in Canada is OLG, based on a study done by Stars Group. Tere are 25,000 lottery retailers that now all become somewhere that single sports betting can take place. Te lotteries can leverage their brand positioning and the “good housekeeping seal of approval” that comes with that brand. Tey are very trusted, but what they lack is the depth of experience that the international operators have, and they likely do not have the marketing budgets that the international operators can afford to deploy.
With the exception of Ontario, sports betting will remain under the control of state monopolies. Do you think other states should follow Ontario’s lead and create a legal market for bookmakers to operate?
Yes. Ultimately, the governments of other provinces will look to see how Ontario is going and then they will decide if it works for them. I believe that, eventually, this will be in most, if not all provinces.
What are some of the unique characteristics of the Canadian sports betting market?
I am not sure that the market is unique, it is just different from the US. In fact, we in Canada look a lot more like Scandinavia than we do the US.
Markets have unique relationships with various sports. NFL is King in the U.S. but in Canada, while the NFL will be the biggest, hockey will be significantly more important than it is in the U.S. We do also have the CFL, our version of Aussie
“Te regulation of sports betting brings a multi-billion industry out of the shadows, much like cannabis. Sports clubs will have a new category of sponsors, provinces will collect tax revenue that they were not able to collect before, employment benefits will be felt across the country, and operators will generate economic activity via advertising, employment and taxes.” Jordan Gnat, Playmaker.
average sports fan in Canada has not been betting on single events for the very reason that it hasn’t been regulated, which has created hurdles to acquire users in this market. Betting is going to become much more mainstream once it’s in the mass media; it will become less taboo and bettors of all levels will be converted to legal books.
How will provincial lottery operators attract players who have been betting via grey or black market sites for years?
Te provincial lotteries have been offering sports betting since 1992. Single sports betting is a product variant, it is not a “net new” channel. It is the next evolution of sports betting in Canada, just like Super 7 became Lotto Max. Te most
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Football, and Major League Soccer, and I’m sure there will be betting on those too.
What are the financial implications for sports clubs, the provinces and potential sports betting operators now that single event sports betting will be allowed?
Te regulation of sports betting brings a multi- billion industry out of the shadows, much like cannabis. Sports clubs will have a new category of sponsors, provinces will collect tax revenue that they were not able to collect before, employment benefits will be felt across the country, and operators will generate economic activity via advertising, employment and taxes. Overall, this is going to be a net economic boom.
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