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Sports Business Journal - Alternative sports: The next stage in sports betting’s evolution




Thank you for the coverage, SBJ! We agree and look forward to building out the Alternative Sports Betting Ecosystem, bringing the world's most exciting sports online for betting.

 

Oceanside, CA - Monday, July 10th, 2023 - Five years into the legalized sports betting market in the U.S., we appear to be at a crossroads. While a $7.5 billion industry has emerged, sportsbooks continue to battle fiercely for new users in an effort to gain market share. Despite the high levels of competition in place, true product differentiation between operators remains slim. Operators have done a great job building engaging markets around the Big Four sports, which has fueled the industry’s rapid growth, but there remains a clear demand to connect with new audiences.


The alternative sports market presents a precise solution to the challenges seen within this space. There are millions of highly engaged, yet overlooked, fans seeking additional opportunities to immerse themselves within the alternative sports landscape. Regulated sports betting has not previously been available for this group of fans, leaving a clear gap in the overall fan experience. Sportsbook operators simply need to develop the infrastructure and necessary partnerships for proper betting markets in order to reach an additional base of rabid fans and potential bettors.


What are Alternative Sports?

There are over 100 alternative sports verticals that generally fall into the categories of action sports, endurance sports, motorsports and outdoor/adventure sports. We partnered with the Wasserman Media Group to complete a 41,000-person global study of the alternative sports market. Our study found these disciplines represent more than one billion active fans (fans that actively watch and follow each sport) and thousands of events per year across the world, with some of the most engaged content and fans across the globe. Listed below are some prime examples of growing leagues within this category.


  • Created by Dana White, Lorenzo Fertitta and Craig Piligian in partnership with Ultimate Fighting Championship

  • Power Slap 1 received 3.2 million views on Rumble this past January

  • Boasts 3.3 million followers on TikTok

  • 2022 WSL Championship Tour Coverage reached 28 million fans across all social platforms

  • Owns 17.3 million followers across all social channels

  • More than 180 live events per year

  • According to Concrete Wave magazine, there are 85 million participating skateboarders worldwide

  • Has an audience of 6.3 million on social media

  • Delivers more than 3,000 pieces of unique content per year

What Can It Do for Sports Betting?

Currently, every operator is competing for the same customers by repeatedly focusing on traditional sports. While this has certainly been effective in laying down a foundation of reliable bettors up to this point, it has also illuminated the need for market evolution, and presented the opportunity for sportsbooks to widen their offerings and reach, as opposed to continuously going deeper.


Our study with Wasserman found the alternative sports market to be a ripe area for expansion due to crossover. According to the study, 40% of U.S. surfing fans already identify as bettors along with 32% of the skateboarding market. With 1.1 billion prospects worldwide watching and engaging with alternative sports, not only is the crossover existing bettors betting on the Big Four sports high, but fans of alternative sports were identified as young, affluent and risk takers, citing they would bet three times more often and five times as much when compared to fans of traditional sports. Embracing alternative sports such as surfing or skateboarding, which have the added benefit of Olympic recognition, is a prime way for competing sportsbooks to expand their offerings and truly distinguish themselves from competitors.


To highlight the demand for this product, we helped the Street League Skateboarding Chicago event acquire sports betting approval in early May 2023. This was the first time skateboarding was live and legal for sports betting in the history of the sport. According to our betting partner, the three-day event generated more handle and first-time depositors in one weekend across just four states, with minimal promotion, than pickleball — which is live in 11 states — did in five months.


Success of Alternative Sports in Marketing

In the past, we have seen emerging brands successfully utilize the alternative sports market to drive immense growth figures. GoPro, for example, built a $1.5 billion business by targeting pockets of overlooked fans, as opposed to simply going after NFL or MLB fans. This allowed the brand to connect with niche audiences, develop effective messaging campaigns and ultimately acquire users at a notably more cost-efficient rate.

A lot of this success ties back to the nature and audience of alternative sports. These sports are largely considered “lifestyle sports,” offering a market of significantly engaged, responsive and participatory fans. This produces ample opportunities for effective short-form and user-generated content, which are essential in securing elevated visibility.


Next Steps

Those within the industry understand there will be pivotal M&A activity to come, and the number of active operators will continue to dwindle due to the competitive nature of this industry. For those looking to remain in the market long term, there must be strategies in place to attract users beyond mainstream audiences.


Alternative sports offers a path for prolonged success by allowing sportsbooks to begin going wider instead of deeper. This creates meaningful product differentiation, while also establishing valuable relationships with a considerable number of untapped fans and bettors.


Joe Dunnigan is founder and CEO of ALT Sports Data, the leading source of official and unofficial alternative sports trading data unlocking millions of participatory fans and potential bettors for sportsbook operators, media platforms and event producers.

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