Some of the largest sports betting operators in the US and beyond are looking to enter the Canadian sports betting market, but few have positioned themselves as quickly as the Australian betting firm PointsBet.
Prior to the passage of C-218, the Safe and Regulated Sports Betting Act in June, PointsBet launched PointsBet Canada, a new division focused solely on the Canadian betting space.
At the same time, PointsBet hired former Monkey Knife Fight president Nic Sulsky as Chief Commercial Officer to lead the new Canadian venture.
On 27th August, single-event wagering became a reality in Canada and provincial lottery operators can now offer single-event wagering. However, commercial operators have yet to enter the market.
GamblingSpotlight caught up with Sulsky to discuss how PointsBet plans to establish itself in the Canadian sports betting industry.
GS: What were your initial reactions when single-event sports betting got the green light in Canada?
Sulsky: It was extraordinarily exciting. It’s something that a lot of people have been working on for over a decade and the momentum for the legislation started really building up in the early parts of this year and to see it finally get over the finish line was really exciting.
I joined PointsBet Canada and was the first employee of the Canadian business and I made that move and accepted the position based on the hope the legislation would pass. Because obviously if that legislation did not pass, it would have been a bit of a challenge to launch the business as quickly as we all hoped. With the final nod from our parliament, it was met with extraordinary excitement and anxious energy.
GS: Following the developments over the last few months it seems like the process has been pretty quick, would you agree?
Sulsky: It was quick for those who weren’t on the front lines of the Canadian gaming space for the better part of a decade. Quite frankly it’s a little bit more complicated than it seems. As an example, single-event sports betting went live in Canada on August 27th, but only the already-licensed lottery corporations. No operator is licensed to operate legally in Canada yet. So as much as things have moved quickly, it’s not as quick as it seems.
GS: As each Canadian province will regulate its own sports wagering market, where can we expect to see PointsBet in Canada?
Sulsky: PointsBet will operate in all provinces as those provinces regulate and the licensing regimes begin. PointsBet will not operate in the grey market in Canada. We will only operate in provinces where we get licensed and have proper regulations.
GS: Which province do you think will be the first to welcome commercial operators?
Sulsky: Ontario will be first. The AGCO has oversight for single-event sports betting and the igaming licensure in Ontario. Similar to the US, Canada will launch province by province, as you are aware. So Ontario will be first and the target is early December of this year. The formal regulations have not yet been issued but are close to being issued. From there contracts will be signed with operators, platforms will be tested and licenses will be issued. It looks as though early December will be the target, December 6th specifically is the target that has been stated a number of times by the AGCO.
GS: It’s really exciting how the market is opening up. It seems very similar to the rollout in the US.
Sulsky: It is exciting, but there’s a lot of differences between the US market and the Canadian market. From a gaming perspective, the biggest difference is how the grey market operators have been functioning in Canada versus the US.
In the US when a state opens up, everyone starts on the same line. In Canada, because of the amount of grey market activity, there are ten-plus operators who already have significant databases and market share.
So for those operators who will not enter Canada until the regulations are in place, it definitely puts a different challenge on the table as opposed to operators when a US state opens.
GS: How will newcomers into the market like PointsBet plan to acquire new customers who have grown accustomed to using grey market operators?
Sulsky: I think operators are going to take different tactics to try and siphon off some of those users who have become comfortable with the grey market operators they have been gaming with. There are a number of bigger brands who will follow a similar playbook that they employed in the US like big money media spends, premium ad buys, sponsorship deals with teams. It will be a very noisy launch to the legal and regulated Ontario sports gaming market.
It’s going to be a hyper-competitive market and there’s going to be a lot of noise around sports properties. As an example, during the Stanley Cup final this year, if a Canadian sports fan was watching the Stanley Cup final they would be seeing ads for a grey market operator, there was a broadcast integration for another grey market operator. Another grey market operator had their logo on the ice of a Canadian hockey team, there were grey market operators advertising on tarps at the NHL games before the market opened up.
So you can only imagine what it’s going to be like for Canadian sports fans when they are watching a sporting event after the market officially opens and media companies, sports teams, and properties can actually advertise real money sports betting without the cloud of ‘dot net’ and ‘grey market’ hanging over them.
GS: Canada looks like it will be a very different market compared to the US. For instance, hockey is much more popular over there. What sports do you think will be the most popular?
Sulsky: The assumption is that hockey will be the leading sports gambling sport in Canada, and I think it will be one of the biggest. But, I also think that American football is going to be a major market in this country. 1.2 million Canadians, for example, watch Sunday Night Football. That’s a huge amount of people. We love the NFL. But that being said, there are other uniquely Canadian sports that I think Canadians will be excited to gamble on. The CFL will be interesting to see, baseball is going to be popular and so will basketball.
I think we’re going to follow a lot of US trends from the big four, but what’s interesting about Canada is that we are a mosaic while the US is a melting pot. By that I mean we are very tribal, we have distant regions across the country and within those regions, we have pockets of nationalities that all like their own specific sports. I think what we will see in Canada is a variety of sports gambling participants in some of the smaller sports that have not necessarily caught on in the US or other parts of the world.
GS: How does PointsBet plan to build a relationship with Canadian sports fans?
Sulsky: That’s like Tim Hortons telling you what the special ingredients in their donuts and coffee are.
We have not been shy about our desire to try and build an authentic and genuine connection with Canadian sports fans. So quite frankly that’s how we’re going to do it. We are trying to create a foundation to have real conversations with Canadian sports fans, to really educate them on what being a responsible gambler is in a regulated market and what a best-in-class product actually is.
The great thing about this market opening up is that the Canadian sports fan is finally going to be able to utilize better platforms to gamble with. PointsBet has, in my opinion, the best-in-class technology in the space. We own our own technology platform which will allow us to customize specific features and product offerings for the Canadian sports fan and we’re hiring best-in-class Canadians to help us figure out how to communicate those advantages and benefits that our technology and approach bring to the Canadian sports fan in a much more genuine and authentic way.
GS: What lessons has PointsBet learned from the US market and how will this influence Canadian operations?
Sulsky: From an operational perspective, PointsBet being an Australian company that decided to build an authentic and distinct US operation comprised mainly of Americans catering to the US audience has proven extraordinarily successful.
Before coming to the US, PointsBet was a brand that most Americans had never heard of. Now after a couple of short years, PointsBet is now in the top five of almost every state we’re operating in. That’s a huge accomplishment and we would be foolish not to try and replicate the success the American team had and the strategy they employed by doing the same thing in Canada.
What’s interesting from a launch and a customer acquisition perspective is that we are going to be able to piggyback on a lot of learning that PointsBet has seen when rolling out state by state in the US.
We believe that each Canadian province is even more unique to one another as states are to themselves. So the things that the PointsBet US teams have been learning and the types of partnerships they are creating and marketing activities they are employing are absolutely going to be things we are going to learn from and iterate on.
GS: Several of your US competitors, like BetMGM, have already signaled their intentions to enter the Canadian market. How will PointsBet set itself apart from the competition?
Sulsky: I think most big US operators are looking at Canada, especially Ontario, with big eyes. Remember, Ontario is the fifth-biggest market in North America.
We’re going to separate ourselves because I believe we understand the Canadian audience, the Canadian consumers, and the Canadian sports landscape better than any other operator does. We are the only operator opening a new Canadian business. Sure, theScore was founded in Canada but they are not the only ones who will have an office in downtown Toronto.
I believe that our understanding of the Canadian sports fan, the Canadian sports teams, the Canadian sports associations, Canadian brands, and what it means to be Canadian are going to give us an opportunity to differentiate and separate ourselves from all of the big operators whether they come from the US or offshore and green markets.