Are NCAA Cinderella teams good or bad for sportsbooks?

The best thing about March Madness is undoubtedly the Cinderella runs. 

It’s a clip from a feel-good Disney flick. The unheralded underdog rises up against the major-conference giant, winning over the hearts of the nation with upset after upset. Jeff Bridges is in talks to be cast as the off-the-wall inspiring coach.

Everyone loves them some sweet, sweet Cinderella, right?

Well, that all depends on who you talk to. Sportsbooks in particular have mixed emotions when it comes to these upstart NCAA tournament teams. 

A Cinderella team is always the betting underdog (Real Cinderellas, at least. Not this No. 9 over No. 8 nonsense). And in the most publicly-bet event of the sports calendar – outside of the Super Bowl – a live underdog is the oddsmakers’ best friend.
 

The betting masses love to side with the favorites early on in the Big Dance, so much so books actually set the odds with the public – and not the sharp bettors – in mind. It’s the reason why many power programs are terrible against the spread in the NCAA. Having an upset or two in the first few days of the tournament pads the books’ pockets, especially if it’s a lopsided seeding matchup.

Cinderella runs are also the main focus of the mainstream media, and a shocking win over a top-ranked team brings a lot more attention to the tournament. And what’s good for the tournament is usually good for the sportsbooks.

“Cinderella teams are great for the book because they draw action and media attention,” Peter Childs, supervisor of risk management for Sportsbook.ag, tells Covers. “It’s great for the tournament and it’s what makes this tournament so great year after year.”

Another market that benefits from Cinderella runs is the NCAA tournament futures odds. Books have been taking action on the outright winner for almost an entire year, with big-name programs drawing the majority of the handle. Having one of these popular plays go down early in an upset gives the bookies a big lump-sum payday.

“It creates large liabilities that are usually avoided,” says Jeff Sherman, sportsbook manager at the Westgate Las Vegas Superbook, referring to the small amount of money wagered on these long shots compared to the heavy action on tournament favorites.

Just like puppies, underdogs are cute early on. However, puppies grow into big, smelly, drooling, shedding dogs, that shit on your floor and get into the garbage. NCAA underdogs present their own problems when they progress too far into the tournament.

For an example, look no further than Florida Gulf Coasts’ Cinderella run to the Sweet 16 in 2013. The Eagles were a relative unknown team heading into their first-round matchup with Georgetown as 14-point underdogs, and quickly captured the attention of the betting public with their wide-open style and flurry of slam dunks. 

By the time Florida Gulf Coast strolled into the Round of 16, coming off upset wins against the Hoyas and San Diego State, it was among the most popular bets of the tournament. The Eagles lost 62-50 to Florida but still managed to cover as 14-point underdogs, giving sportsbooks one of their biggest losses of the tournament.

“(Cinderella) certainly can do damage to our books and specifically Florida Golf Coast (in 2013), it was by far the biggest loss we took on a single game,” Childs says. “Our bettors hammered Florida Golf Coast plus the points. That game hurt us.”

Another reason books aren’t high on a deep Cinderella run is the loss of name appeal the tournament has when an unknown program cracks the final rounds of the bracket. While an underdog run makes for a good story, basketball fans are hesitant to watch and wager when college hoops superpowers aren’t involved. 

“I think it goes against the books when more than one Cinderella team advances far into the tournament, as people like to bet the top teams once we get to the Elite Eight, Final Four, and championship game,” Steve Mikkelson, sportsbook director at the Atlantis Casino in Reno, tells Covers. 

Don’t think that’s true? Take a look at the TV rating for 2015 national title game. The championship between Wisconsin and Duke – two of the more popular teams in college basketball – drew 28.3 million viewers, the highest number in 18 years. That Final Four included Wisconsin, Duke, Michigan State, and an undefeated Kentucky team, helping drum up the highest ratings for the national semifinals in 22 years. 

“As with all of the sports, the farther into the playoffs you go, the more overall interest and betting action happen when you have the top teams playing,” says Mikkelson.

Who will be this year’s Cinderella teams? We won’t know until the bracket plays out over the next three weeks. The one thing we do know is that sportsbooks will be hoping these underdogs do well – but not too well.

Editor’s note: Originally published in 2014. Stats and info have been updated. 




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