Betters get smart
Bookmakers in the 20th Century had it easy. Prior to the new Millennium, bookies could always count on large masses of public bettors – referred to as “squares” by those behind the counter – to blindly bet on the favored team in any sporting event, especially one involving NFL football. Often times it didn’t matter what number the books released on a game, the public would bet the favorite with reckless abandon. This allowed the bookie to set ‘shaded’ numbers which means they loaded down the favorite with extra points. It didn’t matter what number the bookmaker strung up on a team – especially in big games – the squares would line up to take it.
Boy, how times have changed.
In the last five years, bookmakers have noticed a major fluctuation in the way the public wagers on sports. Squares can no longer be counted on to bet the favorite in any situation. Anticipation of where the handle will fall on a sporting event is one of the key tools for a bookie in hopes of securing a strong profit for the house. While many public or recreational bettors can still be relied on to bet their hometown team or an overvalued favorite, the group as a whole is becoming much more educated and much less predictable in the eyes of the bookmaker.
“The public is (growing) tired of getting burned by just betting the favored team,” said Jay Kornegay, executive director of race and sports for the Las Vegas Hilton. “It’s hard to even say ‘squares’ anymore because they are just more educated players.”
The Information Age has ushered in a new breed of sports bettor. Recreational bettors do their homework. They research games on the Internet. They watch 24-hour sports news programs. They listen to radio talk shows. They are familiar and comfortable with sports betting and they understand the point spread. Most importantly, they realize that there can be value in taking the points.
“People are just more educated,” said Tony Sinisi, odds director for Las Vegas Sports Consultants, the Southern Nevada-based odds firm responsible for supplying point spreads to more than 90 percent of the books in the state. “There are more sources to get information. There’s the Internet, there’s a myriad of sports shows on television. If you are looking for (the information) you can certainly find it and you are going to become a more educated bettor.”
“It seems like people are just more accustomed to what the numbers mean and what types of different bets there are,” added Doug Beil, race and sportsbook manager for Terrible's Hotel/Casino in Las Vegas. “In year’s past there would be a significant amount of people that would come to the counter where I work and ask ‘what does minus seven mean?’ You still get that customer and you still get that kind of question, but I think the frequency of that is much less than it used to be.”
Super Bowl XXXVII was one of the first major betting events in which the squares shocked Las Vegas bookies by going against typical wagering patterns. ‘Sin City’ gets so many California visitors that the Oakland Raiders are usually a very popular ‘public team’ with the squares. In this big game they were facing off against the Tampa Bay Buccaneers. Oakland was a slight favorite and the public was expected to bet them heavily (the oddsmakers shaded the line in anticipation of excessive Raiders handle). On game day, however, the public bucked all the trends that have taken place in Las Vegas books for more than three decades and bookmakers saw a huge influx of Tampa Bay money, much of it coming in on game day. The Buccaneers won the game, 48-21.
This year’s NCAA Basketball Tournament provided even more surprises. Las Vegas hotels are booked solid months in advance for the tourney, which is almost as big as the Super Bowl for local sportsbooks when you add up the combined handle for the entire event. The public has always bet the popular teams in the tournament but this year major books like the Stardust and the Hilton actually needed some big favorites like Duke and Kansas to cover in some of their games. This would have never happened 10 years ago.
Kornegay said that the Hilton got off to a bad start last football season because public bettors were making more educated wagers. Sports betting is essentially a battle between the public squares and the professional ‘wise guys’. And you can guess which group usually comes out on top. This symbiotic relationship is crucial for bookies to balance their action (and assure a profit via the vigorish, or commission charged to sports bets). When both groups are on the same side of a game, however, it can spell major trouble for the books.
“The first half of the year (in the NFL) was like that,” said Kornegay of the 2004 regular season. “The public money and the educated money was on the same side. And a lot of times during that stretch they were correct. So the books really got off to a rough start (during) the months we usually have fairly decent numbers. You (look at) the last couple of Super Bowls and you didn’t always just see a rush of favorite money, you didn’t see a rush of ‘over’ money and you didn’t see a rush of favorite and over money (on parlays). There isn’t overwhelming favorite and ‘over’ support like there used to be.”
Even though the squares are getting smarter and they have shocked bookies at certain points in the last five years, all the bookmakers interviewed for this article agree that this trend is good for the industry as a whole. Bookies may be forced to adjust their strategies to adapt to the new marketplace, but the increased volume that comes as a result of more educated and more interested bettors is considered a major positive.
“I think it’s great,” commented Kornegay. “The volume is terrific. The more interest we have, the better. It makes our job more difficult and there is not a problem with that. It’s just more work for us. We pride ourselves on that so-called art form of bookmaking and that is something we have to rely on more and more every year.”
“I think bookmaking is kind of an ‘over-time’ kind of thing,” added Beil. “The idea is still to put up a good, strong number and over time the bookmaker should win out. That isn’t necessarily the case on a day-to-day basis or an event-to-event basis. I think the popularity of our industry helps our industry. The popularity of sports betting is nothing but a positive (for the book).”
There is also more to sports betting than just being informed. Bookies and oddsmakers both agree that interpretation of the information is critical in regards to long-term gambling success.
“I think that even if you have good information, unless you are a professional player, there are a lot of ways (things) can go bad,” said Sinisi. “There’s a lot of pitfalls out there. It’s not just picking a particular winner. It’s money management. It’s dealing with emotions (and) greed. A lot of it is the interpretation of the information. The sophisticated bettor is taking 10 on a game that he should only be taking eight on. It’s the idiosyncrasies, the value judgments that are being made by the wise guys that (differentiate them from the squares).”
Bookies must now make adjustments in the way they operate. They can no longer anticipate that the public will lay all their money down on inflated favorites. Shading – although still prevalent in the industry – is becoming less widespread. Larger line movements will become more commonplace as the squares and wise guys load up on the same side of games, causing bookies to become more aggressive in an attempt to attain balanced books.
“We used to anticipate and we could pretty much predict (the handle) just by looking at the game a week in advance,” concluded Kornegay. “But now it is more or less monitoring during the course (of time) that the wagers come in. And it makes us analyze the type of money that is coming in more – how fast we should move (the number) or not move it at all. It’s definitely more of a challenge. Analyzing the type of money coming in is now probably our most valuable tool.”