TransUnion’s U.S. Betting Report on the fourth quarter of 2024 is a mixed bag. According to the report, online sports bettors tend to have lower risk profiles and stronger financial health than other citizens. Sports betting, it seems, is somewhat insulated from economic volatility.
But according to TransUnion’s Senior Director – Gaming Declan Raines, there are segments of the betting public that fall into the high-risk category.
“While there are reasons to be optimistic as a sportsbook provider, there’s still a necessity to maintain due diligence from a responsible gaming standpoint in order to identify and proactively address high-risk populations,” Raines said during an interview with CDC Gaming.
“The Rise of Online Sports Betting: Ensuring Safe and Sustainable Play,” indicates that gaming participation rose year-over-year according to TranUnion’s most current Consumer Pulse Survey, with 26 percent of respondents saying they participated in some form of online or land-based betting in the fourth quarter, compared to 24 percent in 2023.
The survey notes that the increase in participation was driven by older generations, with significant jumps in participation from Baby Boomers and Gen X bettors. Participation among Millennials, the largest segment of the market, fell from 40 percent to 35 percent, while betting activity from Gen Z was mostly flat.
But a worrisome trend was found in the number of $500+ per month bettors as a percentage of the total betting population. That segment decreased from 27 percent to 19 percent, while online outlets saw the share of high-deposit bettors fall from 30 percent to 21 percent.
According to Raines, betting activity’s decrease, notably around NFL sports betting, was “byproducts of the economy.”
“Last year we were seeing that lagging indicator, a lack of clarity in terms of the U.S. economy going into 2025,” Raines said. “That may have had an impact on consumers’ discretionary spending. We saw that in other sectors, right? We saw people buying less cars. We just generally saw less engagement with the economy, and gaming is no different.”
The survey reveals that the best bettors are ones with high incomes and excellent credit scores. That is no surprise to operators who seek such bettors. But how are those wagerers identified?
TransUnion can help with that task, but Raines thinks that operators should increase their identification of that segment of bettors.
“Do they have discretionary spending available in order to identify those high value but also financially sustainable players?” Raines says. “I think that is something you’re going to start seeing, a trend in the market. Rather than just acquire anybody at any cost, like we saw in the first three or four years (after the repeal of the Professional and Amateur Sports Protection Act), that market maturity and the economic conditions will necessitate trying to find the right types of sustainable players and getting better return on your media investments.”
Many observers believe that opening of new markets – notably California, Florida and Texas – will be a panacea for the sports betting industry. But Raines feels it would be prudent to not assume the inevitability of those jurisdictions.
“There’s a reason those states haven’t come online as quickly as others,” Raines said. “And so, I wouldn’t, if I was an operator, be counting on that as my main source of growth in the coming years. I’d still be focusing on improving lifetime player value within the players base that I have, whether that’s trying to acquire the best types of players or reducing costs from different sources by consolidating their vendors.
“Reducing fraud is another path to growth as well. Not letting fraudsters in, as was a little bit more common in the first few years because of that tendency to prioritize acquisition over anything else.
“I think there are a lot of sources for growth for sports books operators that are within their own house, rather than relying on additional states coming online.”
Also, Raines believes that 2025 will bring more of a focus on problem gambling, with more research into the issue and more scrutiny from jurisdictional regulators.
“Even though within the context of this report we’re seeing some good things for operators, I think it’s still critical for them to continue to invest in responsible gaming, understanding the fact that as we’ve reached this point of market maturity,” Raines said, “it’s very likely that we will states like New Jersey and other mature state markets start to look at their responsible gaming requirements and enhance them.”
