Wynn Resorts Limited has announced the closure of its online sports betting and iGaming brand, WynnBET in eight of the twelve states in which it is currently operational.
Wynn has made the decision to close the following ventures:
- Arizona online sports betting
- Colorado online sports betting
- Indiana online sports betting
- Louisiana online sports betting
- Michigan online sports betting (MI online casino is ‘under review’)
- New Jersey online sports betting and NJ online casino
- Tennessee online sports betting
- Virginia online sports betting
- West Virginia online sports betting and WV online casino
Wynn has announced business as usual in markets where they have landbased properties, Massachusetts and Nevada. The company has also placed its position in New York under strategic review.
Wynn has struggled to contend with market leaders across the majority of jurisdictions in which it has held an online presence. Julie Cameron-Doe, Chief Financial Officer of Wynn Resorts cited high consumer acquisition costs and over-the-top promotional spend in online sports betting as one of the primary reasons behind the shift.
She commented: “In light of the continued requirement for outsized marketing spend through user acquisition and promotions in online sports betting, we believe there are higher and better uses of capital deployment for Wynn Resorts shareholders.”
From Cameron-Doe’s further comment, it’s clear that WynnBET’s hope was less glacial iGaming regulation, with sportsbook offering a vehicle for consumer acquisition and subsequent cross-sell into casino product.
She added: “While we believe in the long-term prospects of iGaming, the dearth of iGaming legislation and the presence of numerous other investment opportunities available to us around the globe have led us to the decision to curtail our capital investment in WynnBET to focus primarily on those states where we maintain a physical presence.”
Customers with WynnBET accounts will have access to their accounts until October 11th, however sportsbooks will stop taking wagers from bettors with immediate effect. If, by the date in October, consumers have an outstanding balance in their account, Wynn will honor the balance and send a check to users with the remaining balance.
FanDuel and DraftKings continue to dominate the US online sports betting landscape, with other large brands such as BetMGM (in partnership with Entain) and Caesar’s struggling to obtain comparable market share.
The initial US sports betting gold-rush and clamber for market share has inevitably resulted in sky-high consumer acquisition costs and thus commercial viability for those without significant market share can prove tricky.
With Wynn reviewing its position in New York, analysts will be intrigued to see if a potential licensee spot opens and the new ‘potential juggernaut’ in PENN and ESPN Bet can obtain a spot. With lofty market share ambitions and financial clauses tied to market share success, the dynamic in the New York sports betting market could soon change significantly.