The big story in New Jersey gaming is obviously the launch and growth of online sports betting in recent months.
But a rising tide lifts all ships, and that’s the case for sports betting operators with online casinos. That group includes one of the early heavyweights in the US industry, FanDuel Group, owned by European giant Paddy Power Betfair.
The Betfair online casino in NJ has benefitted from the presence of being paired with solid sports betting brand in FanDuel Sportsbook, leading to “accelerated casino growth,” according to PPB.
When Betfair Casino partnered with Atlantic City’s Trump Plaza in 2013, few experts gave the European brand much hope of success ahead of New Jersey‘s regulated online gaming launch.
Yet Betfair Casino, which switched to the Golden Nugget online casino license in November 2014 after Trump Plaza was shuttered, has silenced the doubters and gone on to become a formidable force in the Garden State.
More than five years on from its launch, Betfair Casino is the clear No. 1 non-land-based brand in an NJ online casino market dominated by Atlantic City’s brick-and-mortar casinos.
Meanwhile, according to new data from PPB, it’s doing even better because of the existence of its NJ sports betting product:
Initial cross-sell to Betfair Casino has been very encouraging, already contributing to accelerated casino growth. This has elevated Betfair’s online casino market share to 15% in February.
Gross gaming revenue from Betfair continues on an upward trajectory, leaping 30 percent in 2017 year-on-year, and then rising 31 percent year-on-year in 2018 to $34 million.
Of course, only the latter part of 2018 included the online sportsbook, but the hope is for even more growth in 2019 and beyond.
Since December, Betfair Casino has received a boost in the form of additional traffic and business from sister brand FanDuel Sportsbook when it began cross-selling its customers into the aforementioned online casino.
FanDuel Sportsbook has amassed 100,000 online customers in New Jersey since launching last September, according to PPB. Both operators have deployed shared account customer logins and wallets to facilitate a smooth and seamless customer journey.
For those unfamiliar with the set-up, FanDuel Sportsbook and Betfair Casino are part of the FanDuel Group, formed last year following the merger of PPB assets in the US.
The group’s bulging portfolio also includes daily fantasy sports operators FanDuel and DRAFT, as well as horse racing wagering platform TVG. PPB currently owns 58 percent of FanDuel Group, which boasts 8.5 million registered customers in the US.
By introducing clearly visible links for Betfair Casino in the desktop and mobile versions of FanDuel Sportsbook, FDG revealed during a US Investor Day at the end of March it had already resulted in “accelerated growth” for the casino:
So far in 2019, 28 percent of Betfair Casino’s revenue has been derived from existing FanDuel Sportsbook customers. However, just seven percent of the sportsbook’s player base has gambled in the online casino thus far.
FanDuel Group insists this means there is a “long runway of growth left” for casino cross-sell. For reference, the cross-sell rates for the Paddy Power and Betfair brands outside the US are above 30 percent.
New Jersey currently has around two dozen online casinos, creating a congested and competitive market. It became a little bit more crowded when FanDuel’s long-term nemesis in DFS, DraftKings, unveiled its own online casino.
Nevertheless, FanDuel Group said Betfair Casino’s market share has enjoyed a growth spurt of late, rising from around 11 percent between 2015 and 2018 to 13 percent this past January.
The group said its casino offering then hit 15 percent market share in February, more than double (seven percent) its market share in 2014. Market share gains are now being “propelled by cross-sell from FanDuel Sportsbook,” FanDuel Group said during the Investor Day presentation.
In fact, FanDuel Group stated that its casino brand topped New Jersey’s online gaming market in February in terms of market share. Not bad for an overseas online operator that was relatively unknown when it first launched and has no land-based casino player database to harness.
While New Jersey’s Division of Gaming Enforcement doesn’t break down revenue for individual brands on each license, Golden Nugget has held the top spot in terms of online gaming revenue for 27 straight months.
Thanks in part to Betfair Casino, Golden Nugget has now racked up three straight months of online revenue in excess of $10 million. In January, Golden Nugget’s revenue hit a record-breaking high of $12.2 million.
FanDuel Group’s 800-strong team, of which there are over 300 in product development, aren’t resting on their laurels though when it comes to product iteration and keeping things fresh.
Betfair Casino launched 14 new games in Q4 2018. Another 20 were introduced in Q1 2019, plus two new live dealer tables, completing a suite of 400-plus games.
There are also plans to embed gaming content into the FanDuel Sportsbook itself. This means Betfair Casino games tabs would sit alongside sports tabs on the product carousel at the top of the app.
This embedded content has driven growth for PPB in Europe where the dual-brand gambling giant is a finely tuned cross-selling machine.
It’s also far cheaper from a cost per acquisition point of view for a casino to acquire cross-sold players from the sportsbook rather than casting the net for new customers. For FanDuel Group, cross-sell also creates a “virtuous circle of engagement.”
With a national footprint spanning 46 states (real-money wagering in 33) and product verticals covering sports betting, casino, horse racing and DFS, the group is poised to become an online powerhouse. And cross-selling seems set to be a key strategy going forward for the group. (Kentucky Derby betting this spring will surely play into that as well.)
The way Betfair Casino has coaxed a modest seven percent of FanDuel Sportsbook’s customers into playing casino so far suggests there’s plenty of headroom for growth.
Rival online casino operators in New Jersey are probably feeling slightly uneasy about the situation developing. That once-obscure online brand from Europe could be about to put clear daylight between itself and the competition.