Last month, I checked in with Michigan sports betting as the state bounced back in August from a down month in July. Michigan launched its online sports betting market on January 22, 2021, and became the third-most populated state, with legal sports betting behind Illinois and Pennsylvania. In September, Michigan grew with a new all-time high of $386.8 million in total sports betting handle. The previous high was $383.7 million in March 2021. GeoComply, a geolocation tracking technology company, reported a 122% year-over-year increase in US sports betting over the first month of the NFL season. The introduction of a massive market in Michigan certainly helped boost those numbers.
Michigan’s Financial Success With Sports Betting
Michigan’s all-time high in total handle came during the first month of NFL regular season football, during which the state had legalized sports betting after launching in January 2021. September 2021 represented a massive 85% increase in total handle over August’s $208.6 million in sports wagers. However, the online sports betting handle was $354.3 million, not quite surpassing the previous high of $359.5 million set in March 2021, fueled by tons of betting interest in college basketball’s March Madness tournament, especially as the University of Michigan went on a deep run.
Still, sportsbooks generated $27.1 million in total gross revenue on the strength of a 7% hold rate. Online sportsbooks generated $23.7 million in revenue, about 87.7% of that total amount. However, sportsbooks spent much of that revenue on promotions as the start of football season is crucial to fuel customer acquisition and retention. With massive promotions handed out, online operators generated just $17,399 in gross receipts. In September, Michigan collected $426,872 in taxes from online sports betting, down 37.1% from August’s $679,308.
Retail Sports Betting Doubles From August
Surprisingly, the growth in online sports betting in September did not extend to retail sports betting. In September, retail sportsbooks saw $32.5 million in total handle, up 49.8% from August’s $16.3 million in betting action. September’s retail handle of $32.5 million was the second-highest total of 2021, just behind $35.7 million in January, the first month of online sports betting in the state. September’s handle was down slightly from $33.5 million in September 2020.
BetMGM at MGM Grand Detroit led the three casinos with retail sports betting with $13.2 million in bets. In comparison, Greektown Casino’s Barstool Sportsbook saw $12 million in bets, and FanDuel Sportsbook at Motor City Casino saw $7.4 million in wagers. Retail sportsbooks generated $3.5 million in total gross revenue on a 10.8% hold rate, significantly higher than the online sports betting hold rate of 7%. The state of Michigan collected $130,844 in taxes from retail sportsbooks, while Detroit collected $159,970.
Top Operators in Michigan
DraftKings Sportsbook was the top operator in Michigan by a sizable margin with $106.9 million in total handle, representing 30.2% of the total market. However, DraftKings Sportsbook lost $4.7 million for the month as it handed out a large sum of promotional money to aid with customer acquisition during the start of football season. FanDuel Sportsbook may have trailed with $82.1 million in total handle, but it led the state with $3.2 million in revenue. BetMGMSportsbook saw an $81.8 million handle, just behind FanDuel Sportsbook, with a state-leading 10.8% hold rate. Barstool Sportsbook ($29.5 million) and Caesars Sportsbook ($23.4 million) more than doubled their respective August handles but still trailed significantly behind DraftKings, FanDuel, and BetMGM, rounding out the top five.
The University of Michigan’s 6-0 start to the college football season has coincided with the start of the NFL season to deliver plenty of sports betting intrigue to Michiganders. As football season continues to roll on and basketball season starts, Michigan’s sports betting handle should continue to grow.