A fan celebrates after making bets at the FanDuel Sportsbook in New Jersey during Super Bowl LIII in 2019. A paper published last year revealed the prevalence of sports betting ads during TV broadcasts.EDUARDO MUNOZ/Reuters
Are young sports fans doomed to become bad investors because they are overexposed to gambling ideology? There’s probably a way to bet on it.
It may sound like a stretch to connect the love of sports with someone’s future wealth but when you watch a game on TV you might question whether the focus is the sport or the sports betting.
Whether it is a physical advertisement on the court or ice, on the boards around the rink, electronically inserted ads on a broadcast, a gambling company-sponsored half-time show, or even announcers providing commentary that includes gambling strategies, the average number of gambling references per minute of TV broadcast was 2.8, according to a paper published last year.
Prior to the passing of Bill C-218 in 2021, which made single-event sports betting legal in Canada, that number would have been zero.
And while some people might gamble responsibly, problem gambling is linked to behaviours that undermine traditional saving and investing.
That paper in the International Gambling Studies journal examined gambling advertisements in sporting events airing in Ontario. Looking only at five NHL and two NBA games aired over five consecutive days, the study found a whopping 4,119 gambling messages shown to potential viewers across television and advertisements on X. Half, or 50.4 per cent, of the TV-based references appeared on the playing surface (such as on the ice or court) while gambling references took up 21.7 per cent of the broadcasts.
Sports betting ads take many forms, including digital ads that now crowd social media feeds.The Globe and Mail
The advertisements on X were viewed a total of 5,687,097 times and generally featured males between the ages of 25 and 34. Almost half of those ads violated advertising standards by not disclosing they were ads. Out of 36 different brands, FanDuel, a sports betting platform, was the most prevalent of all those advertised.
All of this exposure risks the normalization of gambling in general, not to mention a departure from the purity of sport.
An earlier paper found that problem gambling was associated with higher stock trading activity. That behaviour is well-known to correlate with lower investment returns.
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Last year, I wrote about two other papers that, amongst troubling findings, found for every dollar bet on sports, there was a reduction of just over two dollars in stock market investments. Generally, credit scores decreased and bankruptcy filings increased in jurisdictions that allowed sports betting.
There’s no upside to the onslaught of sports betting that is worth this amount of societal damage.
Leagues will say they need the revenue. Broadcasters will say they need the ads. Fine. But then they own the collateral damage. If you sell gambling inside the game then you share responsibility for the fallout that shows up in lower credit scores, more bankruptcies and empty investment accounts.
I want the culture to reward boring excellence again. Pay yourself first. Buy and hold low cost, well-diversified portfolios. And let me watch the game without being bombarded by sports betting ads. If the new business model of sports requires taking advantage of some fans as collateral, the model is wrong.
We are trading compound interest for dopamine. That is a lousy bet for society that too many people will defend under the idea that most people can play responsibly and they should be free to make their own choices.
Stronger regulation of sports betting advertising doesn’t stop anyone from gambling. It simply restores balance to the games that have been rigged against financial well-being.
Preet Banerjee is a consultant to the wealth management industry with a focus on commercial applications of behavioural finance research.
