US Gambling Companies Could Benefit from Celebrity Ad Ban

2023-09-23 06:55:04

Celebrity Ad Ban Would Help US Gambling Companies

Have you ever chosen a Chase Bank credit card because of comedian Kevin Hart's endorsement? Or bought Tostitos because of a commercial with Dan Levy? Or let Danny Devito sway your lunch selection through his appearances in Jersey Mike's ads?

Research consistently shows that celebrity endorsements have little to no impact on consumer behavior. Despite this, real-money online casinos and other businesses continue to invest in these strategies.

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Recently, regulators in Canada's most populous province took a stand against this trend, and it's something governing bodies in the United States should consider. By recognizing the harm that celebrity relationships with brands often cause, regulators could save gambling companies from themselves.

What Surveys Say About Celebrity Endorsements

Although using celebrities in advertising can enhance memorability, there is a significant gap between brand recognition and actual consumer actions.

A 2014 study from Ace Metrix found that television commercials without celebrities performed better than those featuring them. A 2020 study by WP Engine revealed that survey respondents were indifferent to celebrity endorsements.

The key reason behind this lack of impact is that consumers believe celebrities endorse products solely because they are being paid to do so.

The Complications of Using Trusted Voices in Gambling Ads

Success as a gambler is rare, and even rarer is finding someone who is both famous and successful in online gambling. Additionally, there are responsible gambling concerns to consider. If a gambling company were to find a celebrity who possesses gambling expertise and fame, broadcasting their endorsement could convey problematic messages about gambling as a reliable source of income or a game of skill.

Due to these complexities, gambling companies often opt for partnerships with well-known faces and hope for the best. However, gaming regulators in Ontario have taken a different approach.

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Ontario's Ban on Celebrity Gambling Advertisements

The Alcohol and Gaming Commission of Ontario recently implemented new rules for licensed gambling operators in the province.

According to Heather Fletcher of Bonus.com, the regulations extend beyond athletes and prohibit ads featuring individuals of significant notoriety. The goal is to protect children and youth, who heavily influence celebrities, from the potentially harmful effects of gambling endorsements.

Although US regulators have yet to seriously consider similar rules, it could be beneficial if they did.

Regulation as Protection for Gambling Companies

US online gambling companies continue to make missteps, demonstrating that they have not fully grasped the lesson of "just because you can, doesn't mean you should." For instance, DraftKings' recent "Never Forget" promotion, which turned 9/11 memorialization into a sports betting ad, was met with rightful criticism.

While the inability to obtain a return on investment through celebrity endorsements should already be a lesson learned, the damage caused by celebrities who do more harm than good to brands is even more detrimental.

One example is Betr's partnership with Jake Paul. Despite Paul's large social media following, data show that he fails to convert those followers into Betr customers. Moreover, his recent controversial endorsements only add to the negative impact.

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Betr's performance in generating revenue from sporting events in Massachusetts is abysmal compared to physical sportsbooks operating in the state.

When considering the history of ineffective celebrity endorsements and research suggesting that they only provide minimal benefits, it becomes clear that gambling companies should move away from this strategy and make better use of their marketing budgets.

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