Barstool Sportsbook rapidly gaining market share as PNG stock hits record high
PNG CEO Jay Snowden says operator is “dabbling” in traditional marketing as acquisition costs in Michigan are below $120
Penn National Gaming’s (PNG) interactive business reported strong market share gains in Pennsylvania in Q4 2020, with its Barstool Sportsbook securing 13.4% of the market based on handle of $188.3m.
During the company’s Q4 earnings report, management also revealed Barstool Sportsbook recorded $27.5m in handle and $3.3m in GGR during its first 9 days of launch in Michigan in January.
A total of 48,400 people in the state registered on the app and 26,200 placed a deposit between January 22 and January 31.
The operator launched its first ever Barstool-branded igaming product in Michigan on February 1, with almost 15% of its sportsbook customers cross-selling into igaming.
Meanwhile, in Illinois, PNG rebranded two of its casino properties to display Barstool Sports Casino signage during the quarter.
The rebrand caused table games and slots volumes in Barstool-themed areas to increase 27% and 26% respectively, despite casinos still maintaining low customer levels due to Covid-19.
In Pennsylvania, 25% of Barstool Sportsbook users were reactivated casino customers that came through the casino operator’s My Choice loyalty program.
Meanwhile, half of all Barstool Sportsbook users in the Keystone State were already registered to a PNG casino upon opening a betting account.
Thanks to its partnership with Barstool Sports, Penn National Gaming CEO Jay Snowden today told analysts its customer acquisition costs in Michigan were below $120, and the operator was on course to break even in terms of revenue this year.
Snowden said that although he believes the firm could be profitable in 2021, its priority was to invest heavily in growing its marketing funnel and expanding into new states.
He also set out a plan for Barstool Sportsbook to enter up to 10 additional states by the end of 2021, with Illinois next on the company’s radar for an online launch.
Snowden said the brand had done well despite there being almost no investment in external marketing since its launch in Pennsylvania in September.
The operator has begun to “dabble” in traditional advertising in Pennsylvania recently, and Snowden said he was “happy with the returns.”
He added that PNG had recently signed a couple of social media influencers to market the brand, including YouTube sensation Logan Paul.
“We have benefited from playing the long game and really thinking about the best partnership for us – we are maniacal about improving our strategy in the long-term and we’re very interested in how we can widen the marketing funnel. Expect what we do to be new, different, unorthodox, but with high returns,” he revealed.
On whether the business was exploring M&A opportunities for geographical expansion and entering other verticals like DFS, Snowden said PNG was considering a number of opportunities.
He said New York was a key state for PNG and it was considering how to acquire, barter or partner its way into gaining market access, depending on the regulatory framework rolled out there.
The operator reduced its net debt in the quarter to $578m from $1.98bn the previous year.
PNG stock was up 8.5% at the time of writing, reaching an all-time high of $118. PNG’s value has risen 265% in the past 12 months.