Ohio sports betting legal differences from other states are easing a much-needed change into the sports betting industry. It will not allow sportsbooks to advertise bonuses as “risk-free” unless customers can earn credits without spending their own money. This targets risk-free bets, which behave more like first bet insurance and are not risk-free.
Recently, FanDuel changed its risk-free bet to a no-sweat first bet. The terms are the same as before. Bettors can wager up to the advertised amount, and get their stakes back in site credits if they lose.
However, the new language is less misleading than the original “risk-free” language. “No sweat” implies a bonus, but not that bettors don’t have to risk their own funds. This is an important difference that other state regulators could learn from.
Importance of Ohio Sports Betting Legal Rules
Ohio is one of the most highly anticipated sports betting markets of 2023. The Ohio Legislative Service Commission estimated that Ohio sports betting could be a $1.1 billion market in its first year. In the next year, it could grow into a $3.1 billion market. Major sportsbook brands will want a stake in that large market. So, advertising will be concentrated in Ohio in the months leading up to the sports betting launch.
But Ohio doesn’t want that barrage of advertising to include claims that bonuses are risk-free when bettors have to risk their own money in exchange for credits they can only use at a sportsbook. Angry claims that sportsbooks are scams can snowball into public relations nightmares. So, Ohio regulators have good reasons to clamp down on misleading risk-free advertising language.
That makes FanDuel’s switch to a no-sweat first bet interesting. The name doesn’t promise free credits that bettors have to spend money to earn, but the language is also vague enough that it can plausibly cover the bonus conditions. Bettors may be comfortable putting money on a sports wager if they know they’ll be given site credits if they lose and can try again.
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Remaining Pieces of Sportsbook Marketing Reform
Changing the bonus name isn’t the only thing that sportsbooks will have to get right in Ohio. Sportsbooks also have to commit to advertising changes and make their terms visible and clear to noticeably improve the industry’s advertising practices.
FanDuel is not the first sportsbook to change the name of its risk-free bet. Caesars Sportsbook changed its risk-free bet to bet insurance. The terms were the same. Only the name was different. However, Caesars Sportsbook switched back to the risk-free bet name. So, Ohio bettors will have to wait and see whether FanDuel will commit to its bonus name change.
A clearer bonus name isn’t the same thing as clear terms, either. Whatever the bonus is called, bettors must understand that:
- Site credits can’t be withdrawn like cash.
- The first bet is usually the only one the bonus applies to.
- Sometimes the first deposit determines the number of bonus credits a bettor can earn.
These terms can’t keep going into fine print below a bonus or on another page. Welcome bonus terms could be on the same page as a first deposit.
In the same way that a bet slip tells bettors how much they could win, a deposit screen could tell bettors how many site credits they stand to earn based on their deposit and their subsequent bets. This would help bettors confronted with risk-free bets and deposit bonuses.
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Long-Term Benefits of Short-Term Costs
Adopting these measures may make it more expensive for sportsbooks to acquire customers. Clearer bonus terms could result in bettors earning site credits they would’ve otherwise missed. More honest but less misleading language may reduce the number of bettors who sign up. More people may jump at “free” money than insurance or no-sweat bets.
However, those short-term costs seem less dangerous than the potential long-term costs. Ontario doesn’t allow bonus advertising at all, partially because of how saturated American billboards and broadcasts became with bonus advertising. It has removed the initial appeal of many American sportsbooks, forcing them to change their marketing strategies.
As other state regulators adopt stricter marketing laws, sportsbooks may not be prepared to win bettors over through traditional marketing.
American sportsbook marketing regulations are lenient. Ohio’s restriction on risk-free language is a small step toward ethical marketing. So is FanDuel’s decision to change its welcome bonus language. But sportsbook marketing problems run deeper than bonus names. The visibility of bonus terms would be a logical next step for state regulators to tackle.