From Loto Foot to Bet Builder, sports betting through the years
Betting evolution analysis, ANJ marketing report 2024, Winamax joins DSWV, Richard Flint next Entain CEO?
Hello, on Gaming & Co today:
With Bet Builder the talk of the betting town, Olivier Kaplan starts a series looking at how sports betting products have evolved in the past 25 years.
French regulator ANJ revealed that marketing budgets will rise 14% in 2024 in France and called on the industry to advertise responsibly during the Euros and Olympics.
Winamax joins German trade body DSWV.
News in brief: will Richard Flint be the next Entain CEO?
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Sports betting: from Loto Foot to Bet Builder (Part 1)
With Bet Builder set to continue to be the sector's flagship product in 2024, Olivier Kaplan, a longstanding expert in online sports betting with more than 20 years experience with La Française des Jeux and Betclic, recounts and analyses the evolution of sports betting over the past quarter century.
Under construction: For nearly 10 years now, almost all sports betting operators have had as a key objective to offer a quality Bet Builder product to their players.
But while Bet Builder has made a number of operators very happy, particularly in the US where it generates substantial margins when compared with single bets (on average 15% vs. 5% respectively), is Bet Builder an end in itself?
Have we reached the 'ultimate product' and what can we expect in terms of new products from the sector?
To better understand Bet Builder's position and importance in the market, let's take a look back at the sports betting developments that have brought us to the current product as it stands.
From 1X2 grid to fixed-odds betting
In the late 1990s in most of continental Europe, the only way to bet on sport was to fill in a grid of football matches and predict the overall outcome. Based on a pools/pari mutuel system, whatever the number of matches to predict, you had to find the winning choice between 1, X and 2.
Difficult and, sometimes, rewarding: In France, this product was embodied by Loto Foot, a slight evolution on the emblematic Loto Sportif, a basic but extremely difficult game and therefore highly rewarding (when players were lucky enough to win having risked at least THE surprise of the day).
Can’t hide the disappointment: As a result, players were often left disappointed, either because they never won, or because when they did win, the sums involved were minimal because the results were logical: all the favourites had won and once the money had been shared out, the size of the payouts was disappointing.
This is the result of a game that mixes expertise and pools: either there are surprises and you didn't anticipate them, or there aren't any and all the other players win and have to share (minimal) winnings.
What players wanted
Unanimous: The findings of player surveys were unanimous and pointed in the same direction; the need for a sports betting product that allowed players to win a little, but regularly (or a lot, but with increased risk), but also to be able to choose the events on which they wanted to bet.
Fixing it: This resulted in the arrival of fixed-odds betting in France, with FDJ launching Cote & Match at the beginning of 2003 across its retail network and online.
Immediately it was well received and, although limited to football and 1X2, it quickly diversified thanks to technological developments, with other sports and other types of bets, and above all an increasingly wide range of matches.
What operators wanted
Accumulators (pari combiné in French) and high margin bets: These have been game-changers for operators. While a simple 1X2 bet appeals to players because of its ease and simplicity, the margins for operators are relatively limited.
A three-choice bet on football matches does not provide a sufficient or high operating margin for an operator, who becomes too dependent on sporting results in a sport where the favourites still win most of the time.
To remedy this, two major routes were taken to enable operators to better control their margins, outside of pure risk management, and therefore, in theory, reach the stage where they can accurately predict their margins.
Olivier Kaplan is a digital transformation consultant with eXalt and started his career with Française des Jeux in 1994 before joining Betclic in 2008. In the next instalment in this series Olivier will explain how the number of punter selections and bookmakers’ offers influenced corporate strategies (and margins).
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Marketing 2024: Euro and Olympic Games in focus
With the Autorité Nationale des Jeux preparing to unveil its strategic plan for 2024 at the end of January, it called on the industry to advertise responsibly during the two major sporting events of 2024.
Summer hits: The promotional budgets of French online sports betting and gaming operators will increase by 14% on an annual basis to €670m in 2024 and 30% of that total will be allocated between May and July to coincide with Euro 2024 football and the Paris Olympics.
The figures, published by ANJ following its annual analysis of operators' advertising strategies, also revealed that at 59% of investment, bonuses and other financial rewards are the most important marketing elements for operators.
Digital windfall: At 46%, online channels will receive almost half of this investment, with television taking 26% and sports sponsorship 15%.
Focus on bonuses: Of the 16 licensed operators in France, five will spend 82% of their marketing budgets on bonuses or other forms of free bets.
This has led ANJ to remind them that they should "significantly moderate their promotional strategy so as not to exert excessive advertising pressure (...) particularly during the period of Euro 2024 and the Paris Olympic Games".
ANJ's campaign also reflects its desire to avoid a repeat of the waves of advertising and negative public reaction that followed the Euro 2020 (2021) tournament.
Partial rejection: Meanwhile Winamax's promotional strategy for 2024 was subject to a partial rejection concerning "the component relating to financial rewards", ANJ said.
ANJ considered that the "considerable volume of financial rewards" posed "a significant risk of intensification of gambling practices, with this risk being exacerbated among the most vulnerable players". Winamax has until 15 February to submit a new application.
In an interview with BFM TV, ANJ President Isabelle Falque-Pierrotin said the authority wanted “the advertising that accompanies these sports bets to be responsible”.
Falque-Pierrotin added that ANJ's strategy was to make operators responsible for offering their products with a certain number of guarantees and barriers, an approach she considers more reasonable than banning advertising."There is a balance to be struck between too much regulation, which kills the market, and regulation that allows a recreational market to develop, and we have chosen that camp," she added.
In its report, the ANJ stated that operators will have to communicate these offers in an understandable way and adopt "moderate use of the most attractive promotional tools" such as fast poker tournaments or high odds betting, as these entail "an increased risk of problem gambling".
The operators will continue with the strategy they have put in place for 2023, "characterised by a desire to retain players, against a backdrop of intense sporting activity around the Euro and the Olympic Games", said the Authority.
Winamax joins DSWV
Winamax has joined the Deutscher Sportwettenverband (DSWV), the trade body for sports betting operators in Germany. The French group was granted a German licence in 2021 following the introduction of the country’s new regulatory regime that year.
The DSWV is calling on the authorities to review their regulatory framework around the marketing of online betting and the range of products that can be promoted by operators, which they consider to be too restrictive.
In November, a report commissioned by the DSWV and the online casino trade body (DOCV) stated that 50% of German punters played on illegal sites, a figure that the German regulator GGL rejected.
A review of the rules on marketing is planned by the GGL and the Länder (autonomous regions) this year.
Alexandre Roos and Christophe Schaming, co-CEOs of Winamax, said: "We want to combine our efforts to work with politicians and the public to obtain effective measures to protect players and combat the black market. The DSWV will work to curb illegal betting offers and improve conditions for legal offers."
News in brief
Italy is set to undertake a major reform of its online gambling laws in 2024 following the government's approval of the Reorganisation Decree. High profile reforms will focus on the skin betting system and the cost of online gambling licences will rise to €7m and an operating fee of 3% will have to be paid by the licensee.
Gaming Innovation Group has launched Betway's offering in Portugal. The two groups have previously worked together when Sportnco, the sports betting platform that GIG acquired at the end of 2021, launched Betway in France, but the bookmaker decided to leave the market in March 2023.
Is Richard Flint, ex-CEO of SkyBet, positioning himself to become the new boss of British giant Entain? Speculation is mounting and odds are tightening as yesterday Flint stepped down as a board member with Flutter Entertainment, the parent company of SkyBet.
Calendar
Jan 17: 888
Jan 18: Flutter Entertainment
Feb 6-8: ICE
Feb 7: Disney/EPSN Bet
Feb 29: Lottomatica
Contact
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