RSI CEO welcomes Ontario progress amid “highly competitive” market

Rush Street Interactive (RSI) CEO Richard Schwartz has hailed progress made by the BetRivers brand in the “highly competitive” Ontario market. Schwartz spoke as part of RSI’s Q1 2022 earnings call, in which the operator revealed revenue growth of 21% and a 32% spike in real-money monthly active users (MAUs), which increased to 150,000. BetRivers launched in Ontario on April 4, and the RSI CEO waxed lyrical about the potential of the market to soften RSI’s deepening net losses. “Canada has been a great market for many, many years. Many brands have existing strong awareness and large existing online gaming customer databases,” Schwartz said. “Given that Ontario has offered licenses to those gray market brands and operators, it is a highly competitive market from day one. “That being said, we are seeing a strong appetite for our regulated product, and we offer a very competitive and high-quality product that is resonating well with customers.” He continued: “We had a very seamless launch and strong start to building our brand and reputation in the market. “We believe we have achieved our goal of establishing the BetRivers brand as one of the most trusted in the market, an attribute that we expect will help us grow in that market over the longer term.” The RSI CEO likened Ontario’s launch to that experienced in Michigan during the first 20 days of operation, but with factors unique to the Canadian market, namely, the advertising restrictions imposed by the Alcohol and Gaming Commission of Ontario (AGCO) and the presence of former gray market operators. “This means it’s likely that it will take longer for this market to build, but the demand exists, especially for high-quality betting experiences like the ones we offer,” Schwartz said. “Our strategy during the prelaunch period to generate brand awareness and excitement around BetRivers has allowed us to get off to a quick start and establish ourselves as a premium option for customers. “We are very familiar and comfortable with entering a market after others who have existing databases and building shares steadily over time. And unlike what we saw in New York, we expect Ontario to contribute positive revenue from the beginning,” he added. Alluding to the promotional war which took place in the early stages of the New York market, a war which is largely subsiding as the effects of the Empire State’s crippling 51% GGR tax rate hit home, Schwartz highlighted RSI’s own approach as being centred on delivery of good customer service. “On a relative basis, we are generally disciplined and prudent in initial promotion and marketing spend,” he explained. “We estimate that last year we bonused at 35% less than our largest competitors. We believe firmly that players will come to, and more importantly, stay with the brands like ours that they enjoy and trust, and bonus them in a fair and consistent way. “We don’t believe loyalty is achieved by bonusing heavily for early action and then pulling back on that bonusing down the road. Rather, we believe loyalty is achieved through the user experience and how we treat our customers. “As a result, our strategy leads us to target new customers who we believe over the long term will place a greater value on experience rather than bonusing,” he added. Schwartz also highlighted good customer service as the second big key driver in retaining players aside from targeting the right type of players. “This has been a focus of ours from the very beginning and one in which we continue to invest in from both an internal training and development perspective, as well as technologically in employing the tools needed to continuously measure satisfaction levels,” he said. “Customers notice when we reduce friction for them, when we address their issues in a professional and timely fashion and do the little things to delight and earn their trust.”