Sports betting is often considered the fairest type of gambling. After all, you aren’t betting on random chance. You are predicting the possibility of an outcome using the information on each player or team. There’s no way for a casino to force you into a disadvantageous bet and make money from sportsbook betting.
Or is there? After all, if they weren’t making some kind of profit, they wouldn’t be able to continue operating.
Keep reading on, as I explain how they do it.
1. The Vigorish
You might not have heard of the term ‘Vigorish’ or ‘Vig’ before. It is an old-fashioned word used to refer to a commission.
This commission is taken from the winners of a bet. This is how most casinos make money from sportsbook betting.
Suppose there is a match with two teams that are almost equal. According to all the analysts, it is impossible to tell who would win. The odds are 50/50. Normally, you would expect that on a win, you would get your stake back plus winnings equal to the stake. That would equate to a total of $200 back.
However, that isn’t the case with sports betting. A small commission is taken from the winnings. For example, a 10% commission might be cut.
So, instead of getting $200 back, you would get $190 back. The $10 is the vig.
2. Wins and Losses Average Out
Generally, sportsbooks will take lots of different bets from players. In each bet, some players will win and others will lose.
The overall goal is to even out the wins and losses. All the winnings will be paid out from the losses. The vig is what gives Sportsbook its house edge and ensures that they make a profit in the long run.
This is where a lot of operators fall short and fail to make money from sportsbook betting. They do not add a large enough handicap or make the odds on the less-likely side tempting enough.
In that case, too many punters choose the safe option. Suddenly there are too many wins and not enough losses – meaning the sportsbook cannot pay out to everyone and might go bankrupt.
3. Determining the Odds and Handicaps
Determining the odds is one of the most important parts of running a sportsbook.
Players or teams are not always equal going against each other. While the very best teams are going to be on roughly the same level, there could be major gaps between the rest of the teams.
So, how do sportsbooks make up for this and prevent people from all betting on one side? They introduce handicaps to it.
In a handicap bet, one side is given a handicap. For instance, in Football, a handicap might be Manchester City -2 and Arsenal +2. That means when it comes to scoring, we treat the final score as -2 or +2 respectively.
If Manchester City beats Arsenal by a margin of 2 or more goals, then it will count as a win for the purposes of the bet. The winners will get paid out. However, if Man City does not win by the handicap margin, then the bet will be considered a Push. All the players will get their money returned to them.
4. Keeping a close eye on the Sharps
Sharps are punters who are extremely well-informed and experienced. They have as much, if not more, knowledge as the sportsbook’s bookies. They are very likely to win their bets very often.
Obviously, a player who can win consistently is a problem for a sportsbook. In order to keep Sharps from getting too much of an advantage, the sportsbook will lean on the odds a bit.
If you notice that the odds on a particular bet are pushed to one side, then it might indicate that there are sharps placing bets on one side. The bookies are encouraging normal punters to bet on the opposite side in order to balance things out and make money from sportsbook betting.
5. Attracting Punters with Bonuses
Bonuses are a great way to attract a player. Once you have activated a bonus, you have to fulfil the terms and conditions. Usually, these terms include making a large number of bets.
This is one way to encourage players to keep betting. So, someone who gets a big, lucky win on his first bet is encouraged to keep going.
Eventually, they may start losing and return most of the winnings back to the sportsbook.
Can Players Really Win in Sports Betting?
After learning about these strategies casinos use to make money from sportsbook betting, you might be wondering: can players really win?
The answer is ‘yes’. In the short run, lucky players can definitely win. In the long run, players should treat sports betting like any other kind of entertainment.
That is to say, it is fun for a while, but costs a bit of money. If they are lucky or plan things very carefully, then there might be some profit involved instead.
Want to learn more about sportsbooks and sports betting? Stay tuned to our blog or get in touch with us.
