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PandaScore: US esports betting market yet to match sports’ sprint

By William - 11 June 2024

Whilst it hasn’t shared the same trajectory as sports betting post-PASPA, Oliver Niner, Head of Sales at PandaScore, explains why esports betting has the potential for huge success in the US.

Sports betting in the United States has exploded post-PASPA, with a land grab taking place between operators as individual states legalise and begin regulating the sector.

In most cases, from the moment that operators opened their doors, customers have come pouring in and so too have colossal turnover numbers.

Being one of the biggest consumer markets in the world, it comes as no surprise that sports betting has sprinted out of the blocks. But esports betting has only taken its first few steps and is yet to build up to a consistent jog.

Esports betting in the United States hasn’t seen the same trajectory as sports for several reasons, and on the whole remains a very untapped market with the potential to be hugely successful.

Regulation here, regulation there

The state-by-state approach in the US is the most obvious of blockers – not just for esports but sports as well. In European jurisdictions, it’s largely national regulatory bodies that govern betting.

This means that stakeholder management, legal checks and balances and key decision-making are in most cases, all answerable to one organisation. If everything is in place you’re ready to operate in a whole country.

In the US you have this in every single state, each with its own specificities, lobbying interests, and varying knowledge of what esports is, let alone esports betting. While many US states will have populations larger than some European countries – making regulation and licensing incredibly lucrative – having 50 or more sets of this to work through is an added layer of complexity.

In some states, esports has been left out of the sports betting equation entirely, while others have classified it as ‘event betting’ similar to an MMA event.

Colorado is a trailblazer for esports betting, regulating it in the same fashion as traditional sports – a major reason why operators and suppliers who invest in esports have been entering the jurisdiction either through partnerships or direct licensing.

Kentucky’s launch of regulating sports betting in September included esports in a similar fashion, including not just the main esports betting titles of Counter-Strike, League of Legends and Dota 2 but also the ever-rising Valorant and other titles like Call of Duty and Rainbow 6.

Products and titles built for the US audience

Regulation is of course only one piece of the puzzle, with acquisition, engagement and quality products that give players good experience all important elements to esports betting success in the US.

What is clear from the sports betting boom in the States is that parlays and same-game combos are immensely popular – something that esports does very well. Several suppliers in the space have launched bet builder products that are specifically catered for parlay betting and same-game combos and have already seen incredibly positive uptake in markets outside the US.

American bettors’ preference towards parlay betting is a behaviour that’s in many ways similar to participating in the lottery – that against all odds you’ve won big feeling. Esports betting is perfectly positioned to capture these feelings and sentiments through proven, already existing products.

Additionally, we can be more confident in knowing what esports titles bettors are interested in compared to several years ago. While the US does follow global trends in many ways, there are some notable exceptions.

Call of Duty is immensely popular compared to other regions, which is not at all surprising considering how focused the professional Call of Duty League is on the US market. In the past 12 months, both former European teams have moved from London and Paris to Charlotte, North Carolina and Las Vegas, respectively.

Waiting for the dust to settle

Right now all the attention from the big operators like DraftKings and FanDuel is on sports betting and how to get as much real estate as possible. When the race to grab as much territory as possible begins to slow and operators start devoting more resources into catering their offering, it’s paramount for esports betting to be ready to ramp up to a jog and then a sprint.

Bullish operators who see the potential of Millenial and Gen Z audiences are already positioning themselves to secure as much of the segment as possible. Operators and suppliers alike should do their warmup stretches and get their running shoes on because when esports betting takes off in the US, those who have prepared well will be rewarded with a vertical that will be absolutely massive and the future of your business.