Hooters of America (HOA) has reached an alliance with the sports betting company Draft Kings and is close to completing a deal with Points Bet., another sports betting firm. Hooters guests receive special offers via a QR code or can simply visit the Draft Kings site and use a promotional code.
Appealing to the increasing number of sports bettors across the country presents “an opportunity to drive new customers into our restaurants,” explained Sal Melilli, CEO of Hooters of America, based in Atlanta, Ga., a veteran of 31 years with the company who was named CEO in June 2020. In the U.S. so far, thirty states have legalized sports gambling.
In the states where Hooters are located, five of them currently permit sports gambling including Indiana, Iowa, Michigan, Illinois and Tennessee and that affects 32 of Hooters’ eateries.
Currently that’s a fraction of Hooters’ overall locations. It boasts 379 restaurants with 314 domestic locations, across 37 states, and is augmented by 65 international locations in 18 foreign countries. Of that number, 200 are company-owned and 179 are franchisee-owned.
“We’re still in the early innings of gaming,” Melilli explained, so deals with other companies such as Fan Duel or Barstool Bets could take place in the future.
Establishing alliances with sports betting companies is boosting Hooters’ appeal with its core customers and soon could lead to more partnerships.
To make it easier for its sports-betting clientele, each of the Hooters involved offers dedicated televisions that provide daily sports betting game schedules and betting odds.
And Melilli expects the number of states to legalize gambling to grow. Hence, its restaurants, both corporate and franchisees, are primed to add sports betting to more Hooters nationwide. “The model is set. As fast as they become legal, the footprint is in place,” he said.
Melilli added that “experiential dining is at the core of our brand,” and the emergence and growth of sports betting blend right into that theme.
Hence, the audience for sports betting and what Hooters offers overlap. Milelli said, “Many of our guests come to us for two reasons: our world-famous wings and as a destination to watch sports events.”
Melilli calls the sports betting alliance an “accelerant to what we’re already doing. Now you can enjoy the game, you can bet on it and watch, on dedicated TVs, or place bets with Hooters girls who can talk sports. Now you don’t have to go to a casino. You just go to your neighborhood Hooters.’
While Hooters expects a steady flow of betting customers, Melelli also predicts that there will be surges of guests at certain major events such as throughout the football season, the Super Bowl and March Madness.
Asked if an emphasis on sports betting, which one assumes appeals mostly to men aged 21 to 40, will alienate women diners, Melilli counters that the American Gaming Association data from 2019 indicated that 32 percent of sports bettors in the previous year were women.
Nor is he concerned that some religious people who oppose betting might be antagonized by sports betting. “With our footprint through the country and our core customers, that’s not much of a concern,” he said.
Hooters doesn’t derive any percentage of betting that its customers engage in while gambling. “We are not the ‘house,’” Melilli explained. “The gaming license is with our partners; we’re just the venue.”
Hooters has also trained its staff, called the Hooters girls, to help educate patrons who haven’t downloaded the app yet on what to do, he said.
In most Hooters locations, some dedicated televisions post sports betting odds. In Georgia, however, there are in-store gaming machines.
It has been reported that there are roughly 6.6 million sports gambling addicts in the country, and sports betting companies are required by law to limit this number and post referral services to treat gambling addicts. Whenever Hooters mentions sports betting in its marketing, it too provides numbers such as the one for 1-800-GAMBLER.
Hooters has also been expanding its brands. It now offers Hoots Wings, which has about a dozen units across five states. Melilli described it as “the fast-casual version versus full-service dining,” which was based on the explosion of off premises food consumption.
It also has three virtual brands—Hootie’s Burger Bar, Hootie’s Chicken Tenders and Hootie’s Bait & Tackle, which attract customers on third-party platforms and the slew of food delivery services.
Ultimately its alliance with sports betting firms will have two positive effects on Hooters, Melilli affirmed: 1) It will “increase the dwell time, the amount of time consumers spends in the restaurant,” which should lead to additional spending, 2) Because it offers sports betting alliances, it will make Hooters more appealing to its core customers.