It’s safe to say that Penn National Gaming is fully committed to Barstool Sports. The Barstool brand dominated Penn’s Q4 earnings presentation, with the company’s recent Michigan launch acting as a focal point for Barstool’s current and future successes in the US gambling industry.
“Our investment in Barstool Sports provides us with a fully integrated media platform to support our evolution from the nation’s largest regional gaming operator to the best-in-class omnichannel provider of retail and online gaming and sports betting entertainment,” Penn’s new CEO Jay Snowden remarked.
Snowden went on to say:
“On January 22, 2021, we successfully launched the Barstool Sportsbook app in Michigan and saw encouraging initial results, as we registered over 48,000 new customers and generated total handle of $27.5 million during the first 10 days of operation. We also experienced very high engagement, with nearly 50% of our Michigan customers betting on Barstool-exclusive bets.”
The focus on its sports betting brand could very well stem from a desire to distract from missed earning’s projections (not unusual in the age of COVID closures and restrictions), but that “minor” detail doesn’t seem to be dissuading investors.
The First Ten Days in Michigan
The presentation contains several interesting metrics from the company’s recent launch in Michigan.
- More than 48,000 registrations in ten days
- More than 26,000 first-time depositors over the same period
- $27.5 million and $3.3 million in revenue over the first ten days
“Since launching in Pennsylvania last September, the Barstool Sportsbook app has registered over 72,000 customers in the state and has generated total handle of nearly $300 million,” said Snowden. “despite very limited external marketing spend.”
Michigan is is the company’s first time competing with other operators on equal footing, thanks to Michigan’s synchronized online gambling platforms launch.
Sports Betting Real Value: Cross-Sell
Pennsylvania was Barstool’s sports betting debut, but Michigan is the first state sighting of its online casino, and so far, so good. According to the presentation, “In its first two days of operation, the Barstool iCasino converted nearly 15% of Michigan sportsbook customers.”
That cross-sell is also being realized at retail venues.
As the presentation details, “Following rebranding as the Barstool Sportsbook on December 23, 2020, handle at Ameristar East Chicago increased 35% through the first four weeks as compared to the prior six weeks.” And more importantly, “table games and slots volumes in the Barstool themed gaming areas increased 27% and 26%, respectively, over the same period.”
This Is the Way
The slideshow notes its growth in Pennsylvania is happening despite limited external marketing. And that is one of the key differentiators between Barstool Sportsbook and its peers.
The perfect example of this is Founder Dave Portnoy’s penchant for making news. From the Barstool Fund to his part in the GameStop-RobinHood fiasco to feuding with Tik-Tok stars, Portnoy creates a tornado of takes that generates organic press. Simply put, Portnoy doesn’t need to pitch news stories or send out press releases. He is a news story.
“… while its competitors are busy signing “semi-exclusive” sponsorship deals with teams that have all the authenticity of an arranged marriage, Barstool will simply flip the social media switch. It will leverage its ability to engage with millions of peoples and call on existing, real relationships in seconds.”
Those real relationships can be seen in the number of downloads the company saw in Michigan, and more importantly, the number of depositors.