Following changes that the two brands made in the initial working relationship, the budget allocation that had earlier been agreed upon will be utilized differently. Cutting down on expenditure is a strategy that many organizations adopt when the economic conditions are not working in their favor. This is mostly in efforts to save on expenses so as to maintain an organization’s level of productivity. This definitely makes sense because it costs less to address a combined audience as opposed to catering to different market segments.
The marketing spend that had been set by the initial agreement, that is unused to date because it was intended for the third, fourth, and fifth years, will be spread further to cover two more years. With this change being effected, it means that the average annual marketing budget will be reduced significantly. According to the management of PointsBet Casino, it was important to review the marketing spend schedule if the company was going to achieve its optimum desired level of investment made under a targeted and localized strategy.
The Managing Director and Group CEO at PointsBet, Sam Swanell, has commended the management of NBCUniversal for its great workmanship over the agreement period. Since the two companies came together to form a partnership, the relationship has been cordial. So far the only report emanating from the boardroom is that the companies are enjoying a symbiotic relationship. The only reason that they are reaping positivity is that they both have great teams; working with people who are consistently focused on a common goal makes the journey of achieving set targets quite simple.
PointsBet is a seasoned player in the US gambling market and has drawn great experience since it ventured into the gambling market. While a lot of the lessons learned are from trial and error, it is this rich interaction with the industry that positions the company as a great business partner. Swanell reveals that the brand shares views with NBCU on the necessary adjustments that must be done so that trade targets can be achieved. So as to achieve results from laid down strategies, the business partners must agree to take lessons from past experiences.
The management of PointsBet firmly holds on to the perception that any amount of money spent on marketing is not even close to beating the level of gain and efficacy that comes from working with a worthy partner. PointsBet is happy with the partnership they have with NBCU because it grants them access to unrivaled media properties. This is a great resource for the betting operator because of the contribution it brings to their strong US growth.
Although PointsBet is ranked among the top betting operators in the US market, the performance of the brand is lacking in competitiveness. As a top-10 gambling services provider, the fact that it trails far behind the other industry giants is a point of concern. The company is supposed to post performance reports matching to what is produced by the likes of Caesars, BetMGM, DraftKings, and FanDuel.
According to the amended agreement, PointsBet will retain the privilege of pricing benefits as well as exclusive rights for integration. This consideration is applied to the sports betting category at every level that the company carries out operations. The greatest advantage of PointsBet in the market is the fact that the company maintains its online casino integration exclusivity at a local, regional, and national level.
A statement given by PointsBet on the company’s hold over NBCUniversal’s national media assets indicates that the betting operator has relinquished sports betting integration exclusivity. In the meantime, PointsBet retains a “second look” approach for all national NBCUniversal assets. According to the agreement, NBCUniversal will be allowed to nominate one extra “Official Sports Betting Partner” of NBC Sports.
Football fans will soon see promotional materials during the duration of NBC-sponsored matches. For those who have never taken any time to know what gambling is about, these clips will thrust them into a world of luck and immense possibilities. New job opportunities will also be created for commentators and game analysts to discuss team strengths and possible outcomes before, during, and after a game.
The current gambling space favors companies that are willing to work in partnership with others for mutual gain. With a media partner in their corner, it is going to be a lot easier for PointsBet to achieve its business goals. The same applies to NBCUniversal which will gain not only from increased football viewership, but also from endorsements that will be pledged by entities that want to align with the idea of success.
Having already gone over the budget that had been drawn for the first two years of the respective agreement, it was decided by the partner’s financial analysts that the planned expenditure was unnecessary based on the privileges that each of them brought. Instead of going ahead to allocate the total committed marketing spend for the remaining years, it was deemed fit to add 2 more years to this budget. Considering that the total sum set aside for the five years was $294 million to be used between August 2022 and August 2027, the remaining amount was equitably large.
$25 million was already used up as of the end of 2022 ($269 million remaining). The total projected commitment for the current year which is scheduled to end in August 2023 is estimated to be $50 million (this is a reduction of 43% from the initial agreement.
Conclusion
Partnerships in the casino industry are a great booster for business. This explains why a large number of companies are rushing to find worthy partners with whom they can team up for even greater gain. Ideally, partnerships are akin to customer pooling and this causes a massive shift of attention onto a brand by entities that might have had reason to notice it before. For companies that have taken this route to grow their businesses, the reports indicate mutual gain on both ends.
