The news: Sportsbooks have spent hundreds of millions on advertising in the last year as sports gambling has been legalized in more states, but major competitors like DraftKings and Caesar’s Entertainment dramatically reduced ad spending in the second quarter.
Why the decrease? Sports betting burst confidently into 2022, making headlines for massive volumes of bets placed just days into the new year. But with a possible recession on the horizon and a year of heavy ad spending in the rearview, sportsbooks are feeling pressure to pull back.
Some of that ad money is being diverted into politics; a California ballot initiative supported by sportsbooks like FanDuel and DraftKings that would legalize online betting was certified for the ballot in July.
They’ll be back: Thanks to a healthy slate of sports events in the second half and existing partnerships, sports betting will likely weather the ad downturn and potential recession relatively unharmed.
The big takeaway: Sportsbooks’ conservative Q2 is part of the industry’s long crawl toward profitability, but also means that the ad industry lost another major source of spending.
This article originally appeared in Insider Intelligence's Marketing & Advertising Briefing—a daily recap of top stories reshaping the advertising industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.