August 1 marks the first 12 months of legal sports wagering in Mississippi. The first such bets were placed at Gold Strike in Tunica and Beau Rivage in Biloxi, followed closely by the IP and Sam’s Town Tunica.
So how did Mississippi fare in its first year of sports wagering? Did Mississippi sports betting reach projections? What does the future look like?
Let us review the early projections for the potential for sports wagering in Mississippi.
On May 15, 2018, Allen Godfrey, the Executive Director of the Mississippi Gaming Commission, predicted $60‒$100 million in additional gross gaming revenue as the result of the Mississippi sports wagering market, noting that the real benefits were “having people stay at your properties.” The additional benefits beyond sports betting gross gaming revenue (GGR) to which Godfrey alluded could include additional overnight stays at Mississippi casinos, more covers in restaurants, additional customer play at slots and table games, ancillary sales and gaming tax benefits to the state, and more.
In 2017, a study conducted by Oxford Economics for the American Gaming Association concluded legalizing sports wagering in Mississippi could provide an additional $197.2 million in GGR for the state, resulting in a direct and indirect increase in employment of 2,543 and an increase in direct and indirect income of $98.6 million.
Another 2017 study conducted by Global Market Advisors pegged the Mississippi sports wagering market as being somewhere between $13.1 million and $65.4 million. And in 2018, Gambling Compliance Outlook estimated that GGR for the Mississippi sports betting market would be $56.1 million.
Also in 2017, Eilers & Krejcik Gaming estimated that the total US market for sports betting could be as high as $6.03 billion by 2023. Based on rough calculations from that total number, the Mississippi share of the estimated market in sports wagering could be staggering — approximately $325 million.
The editors of this website predicted $75 million in additional GGR from sports wagering.
Was any prediction close to the mark?
With the sports wagering and total GGR numbers for the month of July yet to be reported, the GGR from sports betting in Mississippi is $30.5 million. If the July numbers match June’s numbers, then the first year of GGR from sports wagering will be approximately $32 million, well under any of the projections described above.
But does that tell the whole story? No, it does not tell the complete tale — for two important reasons.
First, the Mississippi Gaming Commission reports only the numbers from the Mississippi commercial casinos. These numbers do not include any sports wagering revenue numbers from the three casinos operated by the Mississippi Band of Choctaw Indians. The Choctaws do not publicly report any of the numbers from their casino operations, but anecdotal information is that the Choctaws are very pleased with their results from sports wagering.
Second, while the raw numbers for Mississippi commercial casinos regarding sports wagering are not meeting some expectations, the overall increase in GGR for the commercial casinos is up dramatically for the period from August 1, 2018, to date when compared with the same months in the prior year. While the first 12 months of sports wagering GGR is estimated at $32 million, the overall increase in GGR for Mississippi from August 1, 2018, through June 30, 2019, is approximately $104 million (and note that this does not include July numbers for overall GGR). The only logical explanation for the healthy increase in overall GGR is that Mississippi casinos are offering an additional amenity in sports wagering.
As Boyd Gaming CEO Keith Smith said on his most recent earnings call, sports wagering is drawing “new and younger customers” and driving “incremental traffic … that supports the casino,” resulting in a boost to other gaming and nongaming revenues.
These sentiments were echoed by Commission Executive Director Godfrey, who was quoted as saying, “I’ve noticed a significant amount of foot traffic [in casinos]. The operators have told me how many more people are coming in, especially people they haven’t seen in a while. It’s a different clientele, probably a little younger, people who love sports. We know football is key here in the south, especially college football.”
What about the prospects for mobile sports betting? The Mississippi gaming laws permit mobile wagering only within casino properties. The Choctaws have implemented mobile sports betting, but thus far no commercial casinos in Mississippi have done so. Testing of single casino geo-fencing for mobile gaming in Mississippi commercial casinos has taken place, but no one is offering it to the public yet.
Although sports wagering is no panacea for all the issues facing the Mississippi gaming industry, it sure helps. And a new SEC football season is just around the corner.