The Westgate Las Vegas SuperBook announced two weeks ago they would start accepting entries to its popular SuperContest on July 1.
Last week in a series of tweets sent out by the book, they announced the entry fee would remain at $1,500 but “due to rising costs, time and resources we have to dedicate to the event, there will be an 8% ad fee.”
The ad fee is for administrative costs associated with the SuperContest, the premier sports handicapping tournament in the world where contestants choose five NFL sides a week against the spread for 17 weeks. However, it wasn’t long before the SuperBook got a few tweets from the public showing its displeasure with the move, many of those who probably don’t even participate in the contest.
My immediate thought was an administrative fee was actually long overdue. In addition to the Westgate paying the bonus fees of up to $40,000 out of their own pockets, they have advertising fees (about $35,000 is my guess), and credit card fees (maybe $20,000?) have never been talked about.
Think around $90,000 right there in costs out the window in what is an annual loss-leader for the SuperBook. They also pay for the six free SuperContest entry fees given away during SuperContest weekend (Aug. 26-27 this year).
But why should they have to incur losses on something so wildly popular? Last season a record 1,727 people competed with the winner taking home $906,675 (35% of the pot). The SuperBook created a giant, but after it’s all over each season they should be able to at least say they broke even with the venture.
The SuperContest also doesn’t run on auto-pilot. They use thousands of hours of manpower from April through February to operate this thing, and not all from the book itself. It’s an encompassing project throughout the casino and involves services from Westgate departments like accounting, legal, marketing, security and I.T.
What’s the estimated labor cost? Is $85,000 too low an estimate? How about $125,000? It’s a chunky figure for a non-revenue generating venture.
The eight percent fee attached this year probably isn’t enough to just break even. Any good casino analyst will ask: “If it’s so popular, why are we not making any money to it?”
Poker takes out around six percent and daily fantasy sports sites take out 20 percent. And let’s be clear, this just isn’t any contest; it’s the elite of all contests where winners are immediately put into sort of a sports betting hall of fame. That’s why it’s so popular and why so many from all across the country make the visit to Las Vegas to sign up and prove they’re the best handicapper.
The Westgate should probably take 15 percent out and maybe try to actually make money on the brand. And for those who don’t want to join because there is no longer that attractive overlay, try another high-end pro football contest.
Oh yeah, there is nothing like it. This kind of prestige and exclusivity should be able to have a small profit made off it by the casino.
The expectation for most book contests is that it drives traffic to the casino, and pro formas always show an end means to make revenue, or have the contest pay for itself completely. The cost of the contest is always justified by forecasting additional “write” over the counter that eventually translates to win.
The way I see it is Jay Kornegay and his staff have done an amazing job of “giving” every single day to the public. Whether it’s a liberal comp policy, offering the lowest theoretic hold on futures and the best wagering menu in Las Vegas, or the just completed $11 million overhaul in the book to give customers the ultimate viewing experience, they are in a constant giving mode.
An eight percent ad fee was long overdue, but will be forgotten about when the SuperContest winner makes a record $1 million this year.
After the Cavs’ 33-point beat down loss at Golden State in Game 2 Sunday, you could almost hear the collective “here we go again” sigh from northeast Ohio. Cleveland, with some of the most passionate fans in the country, has been let down every year with its sports teams since winning the NFL Championship in 1964.
While we can’t write the Cavs off just yet – it’s only 0-2, there is hope brewing next-door to the Cavs home on Ontario St. at Progressive Field where the Indians just slapped the World Champion Royals around in a four game sweep. In the process, the Indians took over first-place and made a serious statement they’re contenders to win the World Series.
Cleveland’s starting rotation is what was the most impressive. The Royals had been on a six game winning streak and were hitting .385 over its previous 10 games, but the Cleveland starters cooled them off. Carlos Carrasco came back to the rotation after a month off and got things started on Thursday with a 5-4 win. Danny Salazar, Josh Tomlin and Corey Kluber started the next three and won by a combined 20-2 score for Terry Francona’s Tribe.
The Westgate had lots of respect for the Indians coming into the season with 20/1 odds to win the World Series and as of Monday they were down to 14/1 (6/1 to win the AL).
Cleveland last won the World Series in 1948, just three years after the Cubs last played in it. Those two teams meeting in October would be quite a story, where the loser’s plight would be almost as big a story as the winner finally winning.
Micah Roberts is a former Las Vegas race and sports book director, one of The Linemakers on SportingNews.com , and longtime motorsports columnist and sports analyst at GamingToday. Twitter: @MicahRoberts7 Email: [email protected]