Attempting to secure a long-term presence in the Australian wagering industry and pierce the US market with little success, online bookie BlueBet (ASX: BBT) has turned the ante up to acquire new customers at the cost of heavy cash burn – while promoting its offerings to all Australians during our largest annual sporting events.
Reaching for market share in the Australian industry, BlueBet continued to add active customers consistently over the quarter despite reporting falling profits and earnings as a result of solidifying themselves in the space. Highlighting its progress and growth, active customers who have placed bets through the bookie increased 40.1%, bringing the total to 54,920.
Cash burnt on marketing and advertising in the three months to 27 October 2022 reached $4.4 million, up from $3.4 million during Q422. This spend was reinforced as turnover for the period increased 5.6% to $133 million while the Company also maintained a win rate of 10% across all its bets despite the previously mentioned heavy promotional spending injected into the most popular sporting events, the AFL and NRL finals.
During the 2022 finals for both events, where huge audiences are expected across the nation, it was reported that nearly 3 million fans tuned in to watch. Surprisingly equal to just over 8% of our population, which in reality would be much higher as it only takes into account the amount of screens tuning into the event.
Calling attention to the infancy of this business and its experience as a bookmaker, very recently the Company withdrew its sportsbetting licence application in Virginia, United States. Attempting to emulate and mimic a similar strategy to one of its rivals, PointsBet Holdings (ASX: PBH) who is growing to become an incumbent, BlueBet has been in force to expand across the US in fears of missing out on the action.
Listing it as the rationale behind its IPO in 2021, so far the Company has only secured a betting licence in the state of Iowa, but has its sights set on Colorado, Tennessee and Maryland. Whereas, rival PointsBet has already secured licences in 7 US states and market access partners in 9 US states.
BBT shares, along with the rest of the industry, has been in the mix of a multi-year downturn. From its highs of $3.03 in September 2021, shares have decreased over 85% to be worth $0.45 at the time of writing.
Trading Desk Assistant at Emerald Financial
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