Operators regroup after slow start to online gambling in New Jersey
News on 24 May 2014
News on 24 May 2014
New Jersey online gambling operators have been taken by surprise at the slow take-up of their products by online gamblers despite substantial marketing investments, but remain upbeat about the potential of the genre and are reassessing their marketing strategies, according to a Bloomberg business news report Saturday.
Revenues in the month of April were down at $11.4 million (see previous reports) and responses to marketing campaigns have been disappointing.
The Boyd Gaming – 888.com partnership in the Borgata online offering took a $3.2 million loss over the first quarter of 2014 and is reducing marketing spend as well as refocusing the advertising away from poker and more on slots, 888 chief executive Brian Mattingley told the publication.
“We are absolutely shocked by the slowness of the market,” he said. “The operators have not seen a positive response to their marketing campaigns. We’ve got to think again, the way we market.”
Mattingley noted that the New Jersey regulator does not permit unlicensed third parties to take part in the business, and that affiliate websites and other marketing partners deliver up to 30 percent of 888’s gambling traffic in Europe. He also lamented the continued presence and competition of unlicensed operators in the New Jersey market.
He said that 888 envisages bringing on more licensed games with which the US public is familiar from slot providers like IGT and Williams Interactive.
But the 888 executive stressed that New Jersey online gambling was still young: “It’s not even in its infancy, it’s only just been born,” he said.
Tom Ballance, a senior Borgata executive who remains upbeat about the potential for online gambling, cited difficulties with credit card processing with some banks, which had slowed development, along with tight regulatory requirements in the sign-up process; games that aren’t available on some mobile devices; and seasonal factors, with gamblers playing less due to longer daylight hours.
“It’s going to be a slower build,” Ballance said in an interview.
The New Jersey Division of Gaming Enforcement said in a statement that the systems deployed by operators are all working as they should, and that the regulator remains encouraged by progress.
