Legal Sports Betting Has A PR Problem, But Is There A Solution?

Almost every day there are headlines like this from the LA Times:

• Headline in search engines: “Legalized gambling is already ruining sports.”

• Headline on the site: “It’s not just Shohei — a massive scandal involving sports betting is just around the corner”

I am preaching to the choir to this newsletter’s audience, but the Ohtani scandal has absolutely nothing to with legal gambling. However, the legal industry keeps catching strays as that detail gets left out of the Ohtani discussion. The L.A. Times, like many other outlets, has used Ohtani to dive into a dressing down of the legal sports betting industry.

The fact that Ohtani and his interpreter are mixed up with an illegal bookmaker doesn’t seem to matter much in the optics. Somehow it’s all gotten conflated; the narrative around the Ohtani situation is that it is somehow a product of the expansion of legal gambling. That’s despite the fact that this same scenario could have happened whether the federal sports betting ban fell or not.

We could just continue to get angry that the L.A. Times and numerous outlets are conflating legal and illegal gambling either on purpose or out of ignorance. At some point, however, we probably need to confront the larger issue: Sports betting now has a material image problem. And it’s not clear that that image problem has an obvious solution.

It didn’t happen overnight. But sometime in the past six or so months it feels like the idea that “sports betting is a problem” became a thing in a way it hadn’t before. This New Yorker piece did a pretty good job of breaking down the vibes around sports betting, which are decidedly bad for a variety of reasons. Those vibes can lead to a range of outcomes, from nothing, to further limiting regulations at the state level, to possible federal intervention (even though that still seems unlikely, especially in the short term.)

I go back to thinking about the Saturday Night Live sports betting sketch of late. I don’t really care that SNL dunked on sports betting; it’s nowhere near the cultural force it once was. What matters is that it tackled the subject at all. SNL is designed for a wide audience, and the fact that it felt that making fun on sports betting would be a subject that would resonate with viewers is the key point. The writers and producers believed the average person watching SNL has seen these commercials and the parody would get across to them. That says a lot about the state of the industry. It’s good in that sports betting has become part of the national consciousness, but bad in terms of how it’s viewed.

I also summed it up, as Sportico noticed:

“Usually the bad news in sports betting gets a lot of hand wringing in an echo chamber. But I think it’s clear the problems have reached a critical velocity and escaped the echo chamber. The larger consciousness in America is aware. What does that mean? Guess we’ll find out.”

So can the sports betting industry turn the bad vibes around? Does it even need to?Here’s a few thoughts and what could help:

1. Actual change in how sports betting operates and advertises. We now have the recently announced Responsible Online Gambling Association that could help, as long as that organization is dedicated to actual change and isn’t just performative. I think it’s clear that advertising needs to be reined in somewhat, whether it comes from self-regulation or actual regulation. Some of the blowback for legal gambling is because of the increasing integration of gambling into sports/teams/leagues/broadcasts. If sports betting wants to improve its optics in the U.S., I think it takes a lot of work to make everyone believe that it doesn’t deserve the image it now has.

2. More effort at public relations. Some of the problem is that the sports betting industry has let its story be told for it. The American Gaming Association does what it can, but it has a wide membership base and I don’t think it’s the AGA’s job to play whack-a-mole every time there’s a negative story about sports betting. It’s also tough for the operators to stem the tide individually; is it even worth executives or PR folks from FanDuel or DraftKings to insert themselves into these stories? In any event, it feels like there need to be stronger voices and a dedicated vehicle to telling the story of why sports betting isn’t the anti-Christ and why it’s actually pretty good! How does that happen and what’s the vehicle? I am not sure, but I am also sure that the industry needs to do more than it’s doing now.

3. Point vigorously to all the unregulated online sports betting that’s going on. This is arguably just an extension of No. 2, and it already goes on to some extent. But clearly, it’s still not widely known or accepted that 1. offshore sportsbooks 2. fantasy sports vs. the house and 3. sweepstakes sportsbooks are all meaningful industries. Any regulation that seeks to limit legal sports betting — see the recent push to ban college prop betting — doesn’t affect any of these three parallel industries at all, and in fact continues to strengthen them. The argument should be that if we want to make limitations to the legal industry, we need to meaningfully rein in the rest of it, or at least acknowledge that those three things are competitive products that don’t have the same guardrails.

Maybe some of the bad vibes recede with the passing of time and less negative news. But it feels like the status quo isn’t tenable, and the sports betting industry should become more proactive before it starts encountering more poor outcomes.

The Closing Line is a publication of +More Media. 

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