It is the biggest sports betting event of the year, bar none. True, the Big Game in the first week of February generates more excitement and action than any other single sports event, but the collective wagering on the March Madness tournament is far bigger than anything else in Nevada sports betting. As is usually the case, though, the real impact extends far beyond the betting window.
Last year, for example, Nevada sportsbooks accepted about $132 million in bets on the Super Bowl, and won $13 million. The college basketball total for March—mostly made up of tournament wagers—was about $296 million, with $15 million kept by the books.
That’s quite a bit of money, to be sure, but it’s far less than the $500 million or so that slot machines bring in each month to the state. And if that $15 million was split up equally among the state’s 191 licensed betting locations, we’re talking a total of under $79,000 each—enough to keep the bills paid, probably, but not exactly windfall profits.
In the past decade, the amount bet on the tournament has almost doubled. That’s more about the expanding popularity of sports betting itself, though, since the percentage of money bet on the tournament has remained close to 65 percent of all money bet at the books in March. Last year saw the biggest total bet on March Madness yet, and this year’s will likely be even bigger, but betting in general is increasing.
So why do casinos put so much effort into promoting the tournament if it makes so little money for them? A little money is better than no money, but more importantly, the deeper answer is that gambling is increasingly becoming a lure to sell hotel rooms, rather than being the moneymaker itself. Visitors in March typically fill about a half-million more room nights than February and slightly more than April, and while visitors making the trip to bet aren’t the only reason for this increase, they do contribute. Even if the games themselves aren’t significant profit centers for casinos, the tourism they inspire is.
Further, sportsbook directors like March Madness because there are a number of decisions to bet on—67 total games, each with a point spread, over/under and halftime numbers. That’s a better bet than the Super Bowl, which, with everything riding on one game and sometimes one play, can swing either way. The percentage of bets won by sportsbooks on the Super Bowl has swung from -2.8% (the New York Giants’ disastrous upset of the New England Patriots in 2008) to 16.5% (the Seattle Seahawks’ 2015 stomping of the Denver Broncos). Bouncing between 5% and 7%, March Madness has always been relatively reliable for books.
The key to casinos’ increasing buy-in to March Madness, then, is a dependable but not exceptional gaming revenue stream, and fuller hotels and restaurants. As long as the tournament continues to deliver those, expect college basketball to remain a springtime focus in Las Vegas.