Nathan Wilson | Reporter
The payoff is in the fine print
Booking companies scrambled to be among the first to release mobile sports betting apps in Louisiana since state law authorized the new medium as of Friday, Jan. 28. Along with developing apps to cater to the desire of state residents to bet on the outcomes of sports competitions, many companies also used used creative incentives to draw users to their platform.
Companies like Caesar’s Sportsbook and Draft Kings are offering monetary incentives to new users who download their apps, but it pays to read the fine print.
An ad by Draft Kings Sportsbook promoting a bonus deposit of up to $1,000 for Louisiana customers through Feb. 27. This windfall is only available to new users, however, and they will need to deposit at least $5,000 to claim the full value; the incentive is only awarded at a rate of 20 percent of the user’s initial deposit.
Other incentives provide strict rules as to how the bonuses, typically awarded in the form of free bets, can be used and under what conditions they are awarded.
This pattern of high-value incentives is a fairly typical customer acquisition strategy employed by businesses ranging from telecom providers offering phones with a service contract to timeshare purveyors promising vacation deals to anyone willing to attend their marketing session.
The reasoning behind such generous offers is that the relationship that the customer forms with the company brand, and the ensuing sales over the lifetime of the relationship, will more than offset their upfront expense.
For sports booking companies, the incentives are structured to entice customers to download their app, add funds to their account, and ultimately go from sports fans to sports bettors.
Promotional offers typically become especially competitive during periods when new customers suddenly become available. Now with more than a dozen mobile sports betting licenses granted as of the Jan. 28 opening day and a total of only 20 available licenses, sports booking companies are engaged in a fierce fight over sports spectators in the Louisiana market.