Will December Be NJ Sportsbooks’ Last $1 Billion Month?

• In December, New Jersey saw their fourth consecutive month with over $1 billion in sports betting handle, becoming the first state to surpass $10 billion in yearly handle.
• New Jersey’s run as the top sports betting market may be coming to an end shortly after New York’s historically strong mobile sportsbook launch in January.

TRENTON, N.J. – For the fourth consecutive month, New Jersey’s sports betting industry turned in a cumulative handle of over $1 billion in December, making New Jersey the first state to reach a $10 billion total sports betting handle in any single year.

While December saw New Jersey’s run of sports betting dominance continue, that run may come to an end shortly.

At first glance, the over $1 billion handle looks encouraging for New Jersey sports betting however, there are
other figures that are much less promising. Perhaps the most discouraging of these was New Jersey’s December revenue figure of $59 million, down 48.6% from November’s revenue of $114.8 million.

In November, New Jersey saw a hold rate of 9.1% – in December, New Jersey’s hold rate dropped to 4.8%.

While it is a bit unfair to compare December’s legal sports betting revenue figure with November’s record-breaking showing, last month’s numbers are down even compared to September ($82.4 million in revenue) and October ($84.2 million in revenue), which is not a good sign for the state’s sports betting industry.

New York’s Mobile Launch Adds More Adversity

While New Jersey’s run as the king of sports betting remained intact for December, January may be a different story. New York’s mobile sportsbook launch on January 8 may lead to the Empire State’s leapfrogging of New Jersey in the coming months.

New Jersey also stands to lose a substantial portion of their user base to New York with their recent mobile launch. Industry experts estimate that 25% of New Jersey sportsbooks’ user bases hailed from New York before the latter’s mobile launch – combined with declining revenue and hold rates, that loss could serve to knock New Jersey down several spots from its current place as the top sports betting market in the U.S.

This replacement may come sooner rather than later, as evidenced by New York’s unprecedentedly successful mobile sportsbook launch – in the first 12 hours after launch, New York’s mobile sportsbooks recorded more transactions than the next three largest markets (New Jersey, Pennsylvania, and Michigan) combined. In the first 36 hours post-launch, New York’s total mobile sportsbook transactions topped 17 million.

Sportsbooks’ Push For Customers May Come At A Cost

It seems legal online New York sports betting has positioned itself well to enjoy huge handle and revenue numbers for January, which are likely to be the largest in the country; however, the sportsbooks’ push for customers may be coming at a cost.

ISpotTV – a television analytics firm – reports that sportsbooks’ television advertisement impressions increased by about 50% for NFL Week 18 (which came after New York’s mobile launch) compared to NFL Week 17 (which came before New York’s mobile launch).

All of this advertisement has attracted a great deal of attention in national media, with late-night host Conan O’Brien joking about it on his show during Sunday’s opening monologue. Over-advertising is nothing new in the sports betting world – Arizona’s sportsbooks spent over $30 million in advertising during their launch, which also received much media attention. Industry experts warn that over-advertising could lead to a negative shift in perception of the specific advertisement, sportsbook, or worse – of the sports betting industry as a whole; however, it would take a monumental shift in opinion to derail the historically successful launch of New York’s mobile sportsbooks.

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