PokerStars NJ Continues to Lead the Market One Year Later

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Thursday, April 13th, 2017 | Written by Stephen Smith

It’s been one year since PokerStars made its return to the U.S. online gambling market with the launch in New Jersey at the end of March. Like other operators currently providing service in the Garden State, PokerStars has experienced some challenges in the highly fragmented market, but overall the first 12 months has been a positive one for the online poker operator’s first foray into the U.S. market since Black Friday.

Let’s take a look back at how the year unfolded:

– Launch. As a part of their agreement with New Jersey, PokerStars had a five-day soft launch of their site to test for bugs and glitches before the official launch on March 21, 2016. Unlike its New Jersey competitors that offered huge promotions to encourage sign-ups with their launches, PokerStars had just two welcome packages–one for serious players and one for more recreational players. Within just one day, PokerStars had risen to the second place spot in cash game traffic, and five days later, it was the number one site in the New Jersey.

– Smart Promotions Strengthen Market Share. To encourage recreational players to visit the site for quick play, PokerStars unveiled a special edition Spin & Go in April. This promotion was wildly popular, allowing PokerStars to bring in 45.5 percent of all gross gaming revenue during the month. After the April promotion ended, PokerStars had a $1.1 million NJSCOOP event that helped the site retain a 44.8 percent share of revenues. That month, the entire industry made more than $2.5 million in gross gaming revenues, achieving a level of earnings that had not been seen since 2014.

– A Return to Reality. By summer, some of the novelty had worn off, leading to a 23.4 percent drop off in revenues at PokerStars. While the site remained number one, their lead in front of WSOP/888 shrank. Many people began speculating that PokerStars was going to lose its traffic to competitors and that the bustling start had only been due to the hype of a new site arriving in the market.

– A Hard Winter. Despite a headline-making win in late January, PokerStars had a difficult winter. Revenue increased by only modest amounts from November to February, leading us to where we are now with PokerStars enjoying the number one spot, but with its competition close behind.

Looking Ahead to Year 2

So what will year two be like for PokerStars New Jersey? Most industry experts believe that PokerStars will not have a problem holding onto its number one position in the market unless some unexpected shakeup occurs. While the site has brought in some new players, it’s estimated that about 70 percent of PokerStars New Jerseys users defected from competitor sites. If PokerStars invests in the right type of marketing to attract new players from the Garden State, the site could lead to some small growth in the New Jersey online gambling market; however, it is unlikely that PokerStars will grow by leaps and bounds until New Jersey solves the state’s liquidity problem by entering into a player sharing compact with another state or foreign country.

NJ iGaming at Record High in March

In the meantime, the Division of Gaming Enforcement has now released its latest results for March, in the process completing one year of statistics since PokerStars entered the market at the end of the same month in 2016. Impressively, the market hit an all time high of $21.7 million last month, representing a huge 40% improvement versus March of 2015.

Accounting for the lion’s share of revenues was the online casino vertical, up almost 50% to $19.5 million, even as online poker saw its revenue contract by 8.5% to $2.25 million. From the three operators currently offering online poker products, the PokerStars/Resorts Digital Gaming partnership dominated the market with revenues of $909k, while a distant second was Caesars Interactive Entertainment with $693k, followed by Borgata with $650k.

Following the release of the overall record iGaming results, gaming analyst DellaFave heaped praise on the role the industry has played in helping to reverse the state’s fortunes, commenting:

“Online gambling is a critical component of Atlantic City’s revitalization efforts. Nearly three-and-a-half years since its inception, the train that is the New Jersey online gambling industry continues to gather steam. Every month the industry either flirts with or sets a new record for revenue.”