Avoiding the fate of European marketing
As regulated US sports betting begins its journey, it looks like the rest of the world is running into difficulties when it comes to marketing. In this opinion piece, Nathan Rothschild, partner and co-founder at Genius Tech Group, suggests that US operators can learn some lessons from what is happening in Europe and elsewhere and can employ measures to ensure that from the off they don’t run foul of the same issues around over-exposure.
The excitement around the regulated US sports-betting opportunity is palpable and the recent spate of sponsorship deals between betting operators and major US teams and leagues is a further indication of the enthusiasm on display from all sides.
Such high-profile promotional efforts, alongside the rest of the arsenal of advertising and marketing techniques ready to be deployed, are sure to bear fruit in markets that have been starved of regulated betting to date.
Yet, as we can see from the experience in some regulated markets in Europe, unfettered access to available marketing avenues brings with it a warning. The UK is the most obvious example of the dangers of taking market access for granted – and of how a regulator can kick back in a very public and costly way.
Not only are the restrictions on gambling advertising increasing, where gambling is still allowed there are often more stringent rules on what can be advertised.
In this new landscape, winning on product will be the new war to win in sports betting. Regulatory and compliance issues aside, I think one of the lessons from the UK is that operators need to avoid the race to the bottom as they trawl for new customers. It means, we think, focusing on the quality of the products and what you can do to entice the punters to choose your offering and then, even more importantly, stay with you for the long term.
It means looking beyond simple bonusing. In the US it means that as much as the high-profile sponsorship arrangements will undoubtedly be important, along with the other means of marketing, it will be what operators do in terms of acquisition, conversion and retention that will be the new battlefield.
A thirst for sport
Handily in the US, operators have some important aspects on their side. The huge interest of US sports fans, the degree to which all are obsessed with the statistics, the popularity of fantasy leagues and its DFS cousin – all of these are pointers to how betting will intersect with the existing and deep pool of enthusiasm.
It is my educated guess that in the US market, information will be king. That gamblers want to make bets based on informed decisions and that the source statistics and corresponding analytics will be vital in that process. It is also my belief that in the long run, this will matter more than any free bets or other inducements.
This will be music to the ears of the regulators and legislators. An informed punter is a more considered gambler and that should lessen the risk of them getting into trouble or having responsible gambling issues.
It also means that operators will be able to generate greater brand loyalty. The cost of acquiring players in the US will be as expensive as it is elsewhere. Though the financial sums involved in many of the deals announced so far are being kept under wraps, it is a fair guess that they aren’t coming cheap.
Player lifetime values
To achieve the right return on investment, player lifetime values will be all-important and we think the type of product enhancements represented by data and statistics-based offerings will encourage that.
Further elements can be added to the mix. Back in September, I moderated a panel at the Betting On Sports conference on the subject of gamification in sports-betting. We think games as part of a sportsbook offering create huge potential acquisition and retention opportunities. With a prediction element complemented by some easy to digest data analytics added in, the conversion potential is significant.
The American Gaming Association (AGA) makes much of the potential for the sports leagues to benefit from the greater fan engagement that will come with sports betting. This is significant.
We think the AGA is right and that sports betting will be attracting the mass of sports fans across the US. These fans will expect an exciting and entertaining experience and given all we know from New Jersey so far, it is no surprise that the winners – including DraftKings we are pleased to say – are the ones that are offering products which are attuned to what these sports fans want.