Ohio’s sports betting market will feature a platform that could set a new standard for the gambling industry nationwide: the kiosk.
PlayOhio projects that in its first year of legal gambling, the Ohio sports betting kiosk market could generate about $80 million in total bets and account for around 1% of the state’s total sports betting handle.
Ohio sports betting kiosks are uniquely convenient
While many states use kiosks within casinos and retail sportsbooks, Ohio plans a large-scale rollout that is the first of its kind in the U.S.
The self-service betting machines will be available in more than 1,000 businesses across the state, from bars and restaurants to grocery and convenience stores. While online sportsbooks will be the most popular betting option in Ohio, sports betting kiosks will be a uniquely convenient option.
Ohio sports betting to handle $8 billion of bets in 2023
The Buckeye State stands to become one of the largest sports betting markets in the country.
PlayOhio has projected $8 billion in total sports bets in the first year of sports betting, placing Ohio fourth in line behind New Jersey, Illinois and New York. Our projection takes the following factors into account:
- 11 Ohio retail casinos and racinos have sports betting licenses;
- 22 of the max 40 retail sportsbooks are likely to be approved to launch on Jan. 1;
- 21 of a max 46 online sportsbooks are likely to be approved to launch on Jan. 1;
- More than 1,000 sports betting kiosks are approved to launch on Jan. 1.
Even with so many betting options on the table and a strong collegiate and professional tradition in the state, Ohio’s first year of sports betting will have its road bumps.
Ohio kiosk betting favored by nearly 185,000 Ohioans
Arriving at a clear picture of how the kiosk market will influence the larger retail sports betting market is difficult.
As the first state to offer such a product, comparable jurisdictions do not exist. We start with the state’s betting-age population: 9.2 million. Of that population, a smaller population will bet on sports, about 19%, or 1.75 million people, per a Pew Research survey.
A separate survey by PlayOhio found that 79% of Ohio bettors plan to place bets online. That leaves 367,000 Ohioans who plan to bet through the retail market. Survey data further indicates that 24% of respondents will bet via retail sportsbooks and casinos, and 25% will use kiosks. None of the data indicates that respondents will use any particular market exclusively, only that they will try the given market.
Thus, among retail bettors, there is a pretty even split. So, returning to our initial retail population estimate (367,000), we can say that around 185,000 bettors will use kiosks among their sports betting options — a touch more than will bet through casinos and retail sportsbooks.
Kiosk handle will generate a small percentage of total handle
Considering the total amount bet on sports in Ohio, 185,000 kiosk bettors represent 11% of all bettors in the state. However, we project that they would generate only 0.5%-2% of the total handle. A few factors influence this range.
First of all, there is a $700 weekly maximum that can be spent across all kiosks, and kiosks also will not take prop bets or in-game wagers. While this is not a small weekly maximum, kiosks will not be taking any Mattress Mack-level, market-shaping bets.
Secondly, even though nearly 1,000 kiosk operators have been approved to launch on Jan. 1, not all will. Significantly, the state’s largest grocery store chain, Kroger, has been approved to add kiosks inside 42 locations. But it will not install them by Jan. 1. Those kiosks will mainly serve the greater Columbus, Cincinnati and Dayton areas, three of the largest population centers in the state. The company has only said it will go live “later in 2023.”
Still, the kiosks could be remarkably easy to use despite the fact they do not all look the same, with some resembling vending machines and others ATMs. Familiarity with lottery terminals may create a degree of comfort for those trying a new retail betting option.
This ease of use could encourage more betting, or at least easier placement of bets than one encounters in a retail sportsbook. However, such a new technology undoubtedly will face challenges that slow it down in the early stages.
Finally, though kiosk betting could streamline the betting process, most bettors will turn to mobile apps to place a quick bet, limiting the overall convenience of the kiosks.
Thus, while kiosk bettors account for 11% of all sports bettors, the larger bets and more aggressive bettors still will rely on sportsbook apps. And if the novel system encounters problems, and other hosts — like Kroger — decide to wait to launch, kiosks may give bettors pause and slow their intake.
The breakdown: PlayOhio’s kiosk betting projection
Putting all the pieces together, PlayOhio projects kiosk handle in the range of $45 million to $190 million for 2023, with $80 million representing our closest approximation.
This range is from kiosks pulling in 0.5%-2% of total handle, where total handle could range between $8 billion-$9 billion. We’re skewing slightly to the lower end of the range because of known limiting factors:
- Not all kiosks are launching on Jan.1, including 42 Kroger locations, the state’s largest supermarket chain.
- Customer acclimatization to a new market and technology.
- Weekly kiosk betting limits.
- Limits on bet types at kiosks.
- Preference for online apps.
Who will likely use Ohio betting kiosks?
The prevalence of sports betting kiosks will offer a convenience unmatched by retail sportsbooks.
From the person sitting at a sports bar and placing a casual bet to make the game more exciting to someone popping into a gas station for a morning coffee and setting their picks for the week, kiosks could provide simplified access to the retail market.
These customers probably will not seek out kiosks but rather use available kiosks in everyday places.
Ohio Rep. William Seitz, one of the major proponents of the legislation that legalized sports betting in Ohio, told PlayOhio:
“Patrons at bars, restaurants and bowling alleys that currently offer lottery products (including Keno) will be able to place simplified sports bets via the kiosks.”
In many ways, using a betting kiosk will be like buying a lottery ticket, which makes sense because to have a sports betting kiosk, a retailer must already have specific Ohio Lottery licenses.
Adam Hoffer of TaxFoundation.org, an independent tax policy research institute, said there would be some overlap in these markets. Hoffer’s analysis indicates that fluency with the lottery industry and lottery terminals could create market growth as lottery players find kiosks in the same places they play the lottery.
“About half of Americans play the lottery and, obviously, not all of them wager on sports or visit casinos,” he told PlayOhio, “so there is actually a real opportunity to expand the market here.”
Lottery players may take up sports betting as well as playing the lottery. But sports betting could also cannibalize some lottery players, converting them from lottery players into sports bettors.
Will future markets offer sports betting kiosks?
Launching soon after Ohio, Massachusetts sports betting also may include retail kiosks at some point. A Massachusetts Gaming Commission research study examining the feasibility of kiosks at bars and restaurants is forthcoming (due by Dec. 31). The research group will address the impact of kiosks on small businesses.
Those findings will certainly be passed along to other states considering the legalization of sports betting. Texas, for one, with its size and a relatively large population living in smaller communities, could benefit from a kiosk system. Spotty internet service in rural areas of the Lone Star State already forces many Texans to commute to accomplish tasks that others complete remotely. Sports betting kiosks make good sense in these communities.
Ohio has had a launch date in place for months and has been diligently preparing the sports betting industry for one of the biggest launches in the country to date. Depending on how the rollout of the kiosk market goes, other states will be taking notes and weighing the benefits of a more expansive self-service retail market.