Fanatics & FanDuel Push Back on Ohio’s Proposed New Age Limit Regulations

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The fantasy sports website FanDuel is shown on October 16, 2015 in Chicago, Illinois. Photo by Scott Olson/Getty Images via AFP

A proposed regulation is being considered that would restrict sportsbooks in Ohio from advertising bonus bets as a tie-in to non-gambling transactions to anyone under 21 or those on the self-exclusion list.

What’s the Problem?

A non-gambling transaction with a gambling reward is not a problem for virtually all of the 20 online sportsbooks in Ohio. They deal in gambling and their customer list is predicated on those who have signed up for an account and have verified they are 21 or older. Those on the self-exclusion list are readily identifiable and that segment of the audience is rightfully excluded from any communications by the sportsbooks.

Therefore, the proposed regulation to the rules that govern the sportsbooks legally operating in Ohio would not seem to ruffle any feathers. However, there is one notable exception, as Fanatics Betting & Gaming (FBG) has built its brand on the customer lists obtained from selling its sports merchandise and growing its sportsbook from those consumers.

Some of those customers are under 21 and it would now be incumbent upon Fanatics to sort through that list to make sure those minors do not receive a bonus bet or anything tied to its sportsbook.

The new proposed regulation states, “Sports gaming proprietors must not offer a promotion bonus in connection with or as a result of a non-gaming consumer transaction” unless it is offered only to those who are age-verified and not on the voluntary exclusion list.

The regulation goes on to say that any advertisement cannot “target individuals under the age of twenty-one, other individuals who are ineligible to participate in sports gaming, individuals with gambling problems or other vulnerable individuals.”

Fanatics Responds

Naturally, this proposed regulation strikes at the heart of Fanatics’ marketing base, and naturally the company offered its rebuttal.

“FBG has previously noted to OCCC (Ohio Casino Control Commission) staff the Company’s strong belief that executing on a marketing strategy that focused on speaking to Fanatics customers when they engage with Fanatics businesses is not just a sound business decision, but a more responsible means of marketing.

“FBG previously shared with staff statistical support demonstrating that Fanatics Commerce customers are overwhelmingly 21 or older, and a significant percentage of those customers are interested in or currently engaged in sports wagering.

“If the contemplated rule revisions are implemented, to compete in the Ohio market, FBG will shift marketing resources toward other mediums (i.e., TV, out of home) where a higher percentage of minors and Voluntary Exclusion Program (VEP) participants, the very people the OCCC is seeking to limit exposure for, will view FBG’s offers.”

Fanatics Betting & Gaming believes it is being singled out and asked that the rule apply to direct marketing pieces sent by snail mail, email, or text advertising, “which FBG believes is the majority approach in the industry.” A bonus bet tie-in through non-gambling purchases exclusively would rescind its competitive advantage.

Age Verification Concerns

The company also wanted clarity on what is meant by “target” in that operators would have “no reason to know or suspect the recipient of a promotional offer is under 21 or a VEP participant.”

FanDuel also chimed in by saying the expectation of the proposed regulation is unrealistic when compared to the vetting process that is required when customers sign up for a sports betting account.

“…it is not feasible for that same level of verification to be applied to individuals engaged in non-gaming consumer transactions, especially when such transactions take place with a third party. Requiring such a standard would, in effect, be a blanket ban on sports gaming proprietors partnering with third-party businesses in Ohio to provide promotions to their customers.”

FanDuel also requested a revision that would mandate operators are required “to engage in commercially reasonable efforts to prevent individuals who are under 21 or participating in the VEP from receiving the bonus or promotion.”

A permanent decision has yet to be made on this proposed regulatory addition.

Bookmakers Review will continue to monitor this story and update our readers as events unfold.