Businesses Bet on Sports to Boost Bottom Line

The bumpy but successful implementation of Montana’s sports betting legislation has helped businesses stave off pandemic losses

By Micah Drew
Fatt Boys Sports Bar and Casino on Sept. 6, 2019. Hunter D’Antuono | Flathead Beacon

On March 9, less than a year after Gov. Steve Bullock signed House Bill 725 legalizing sports betting in Montana, the first betting terminals were placed inside bars and casinos across the state.

Two days later, the NBA suspended the remainder of the professional basketball season. A day after that, the NHL and MLS suspended their seasons, Major League Baseball canceled spring training and delayed the start to its season, and the NCAA canceled all postseason tournaments, opening the door to a different kind of March madness.

“This inaugural year was strange for sports betting,” said Jennifer McKee, communications manager for Montana Lottery, which operates Sports Bet Montana. “We were prepared to be overwhelmed, but by the end of the week we started placing terminals, all major sports were shutting down.”

After a year of logistical planning for the rollout of Sports Bet Montana, the actual kickoff flopped. A huge ad campaign geared toward informing Montanans about locations where they could place bets was scrapped when Bullock issued a stay-at-home directive, effectively shuttering nonessential businesses, such as the bars and casinos now housing betting terminals.

Workers for Montana Lottery were tasked with relocating terminals within various retailers so people could be socially distanced while using them. They instructed employees on how to properly clean the machines, and then they waited.

Activity finally picked up during the summer months, when the stay-at-home orders were lifted, but the start was slow.

“There was some Korean baseball happening and MMA fights, and there were some Montana athletes in MMA, so that was fun,” McKee said. “But it’s not what we thought we’d be watching for sports betting.”

Because the robust tech team hired to handle any technical malfunctions or glitches had been largely disbanded due to the pandemic, there were several issues to be resolved in the early days, including a glitch where credits displayed on a betting machine would disappear, but as more professional sports returned to play and more Montanans began to place wagers, Sports Bet Montana took off. Now, by McKee’s description, “everything is going gangbusters.”

As of Nov. 16, $11.6 million has been wagered at 280 locations across the state. Of that, $10.2 million has been paid out, and an estimated $632,000 has been paid to retailers in commission, which McKee touts as a key to the support and success of Sports Bet Montana. Of the handle — the total bets placed — the state takes 12% and uses half for STEM (science, technology, engineering and mathematics) scholarships and state funding while returning half to the retailers.

“Every single thing that helps a Montana business to be successful, especially right now, matters,” McKee said.

Alyssa Seeber, the assistant manager at Big Diamond Casino in Columbia Falls, says she’s seen a marked increase in both patrons and revenue since the addition of sports betting.

“We’ve definitely seen an increase, at least 15%, and it’s becoming more and more popular,” Seeber said. “Quite a few more people are coming in just because of the sports betting machines.”

Big Diamond Casino has a betting terminal, as well as an app beacon, which allows patrons to place bets via the Sports Bet Montana app as long as they are within range of the beacon. The signal is curated to reach a smaller distance than the standard WiFi router, following the stipulation that bets must be placed inside of a licensed establishment.

“People can just come in and use the app — they don’t have to come into contact with other people or machines,” Seeber said. “It’s helped counter [COVID losses]. Even if people aren’t big sports gamblers, it helps draw in some of the newbies who are just interested in something different to do.”

While Montana’s sports wagering got off to a slow start, the beginning of soccer (McKee said “we were surprised with the interest in soccer”) and ultimately the NFL affirmed the success of the legislation.

Montanans bet $189,000 on the opening weekend of the NFL, and $472,000 was wagered on Nov. 6-8, the highest weekend for football so far, boosted by the highest-wagered contest this year, Tampa Bay versus New Orleans.

Football wagers make up 28% of the year-to-date handle, but more than 50% of money wagered in most weeks since the NFL season began. The interest is anticipated to continue increasing, especially after an October district court decision that opened up sports betting to businesses that don’t have an alcoholic beverage license.

Out of the 23 betting locations in the Flathead, Big Diamond Casino has the third highest handle in the state to date. Five Flathead county businesses are in the top 10 of statewide retailers in overall handle.

“I think every other state that’s expanded to sports betting passed their law a little different and Montana is unique by prioritizing private sector,” McKee said. “It’s one thing to say we’re investing in Main Street businesses — everyone says that and it’s always true — but we really see how that applies with our products in this year.”