UK sports betting: Just how important is brand?

In what seemed like an act of unnecessary masochism, it emerged last week Playtech had expressed an interest in taking over the Sun Bets contract from Tabcorp. With Playtech reportedly failing to meet the minimum revenue guarantee on Sun Bingo, taking on the betting brand can be seen either as giving itself the best chance of getting out of a holem, or buying a larger shovel. Because if it thought UK bingo was tough, then sports is another level up.

Anecdotal and financial reports show the big brands aren’t shooting the lights out so far in 2018, although you’d expect the World Cup to have acted as a short-term revenue boost. But longer term the UK is no longer a market growing at an exponential rate and one where there are seemingly endless numbers of new brands looking to take a share. What room really is there for a declining media brand with a decidedly mixed public image?

‘Ah but Sky Bet’, will be the usual refrain when that question is raised. But a brand like Sky, which is indelibly linked to a major betting sport, and took the best part of a decade to really hit its stride, and had to reinvent the recreational betting market in the UK to do so, is perhaps an outlier. The history of online gambling is litte red with the skeletons of failed media brands attempting to turn their huge database of “engaged sports fans” into punters. Because, those engaged fans are usually already betting elsewhere.

It won’t stop others trying, however, and the US is undoubtedly going to end up with a number of media brands latching themselves on to this new sports betting boom. It’s entirely possible in a much less mature market some will succeed, but closer to home it feels like this ship has sailed, and crashed, far too many times before to really give anyone much hope for the future. And the next wave of brands crashing on the shore appear to be taking a different approach to winning punters over.

It’s the product, stupid

The gaming brands gradually moving into the sports betting space such as 888 have not tried to create a brand to rival Ladbrokes or William Hill, but has looked more to mine a new softer betting niche and the likes of LeoVegas and MrGreen are pushing that even further with simplified betting options with visually rich presentation. Platform and trading is all handled by third-parties and the operators can focus on front-end and CRM. And, for now, it seems to be working, albeit on a fairly small scale.

The much trumpeted Addison Global meanwhile finally revealed its hand with the launch of MoPlay just in time for the World Cup with a fairly stripped down site, although it’s unlikely this is anything like the finished product. The team are focused on the mobile experience and there is an app yet to come so this is undoubtedly just a small taster, but what we have got is a SBTech skin with some fairly simple enhanced odds and “trending” one-click promoted bets. It’s hard to get too firm a read on what is coming next, but the concept looks to be more user experience than brand, and arguably you could say this is what the market is primed for in online gambling.

Do customers really flock to a gambling site because they identify with the brand or is the brand just a way of drawing attention to your product and user experience? It’s almost certainly a mixture of both, but repeat play is surely driven more by product than brand. Do they come back because they love Sky Bet, or do they come because they love Request a Bet? And as we’ve seen with Paddy Power recently, a drop off in feature development has been blamed for a fairly flat revenue performance in 2017.

Does brand really matter?

Recent efforts to turn sports betting into more of a gaming product, with pre-loaded multiples, enhanced odds and user-generated bets, means the product is becoming more important than the brand. And in a world where advertising is looking ever more threatened by regulators this could be a crucial selling point in the years to come. The temptation is to say that those with the largest brand recognition will win out, but in a world where the product is the brand will that be true?

This becomes even more interesting when you look at what recent M&A activity has done to the UK market. GVC has two similar and competing brands in Ladbrokes and Coral, while Paddy Power Betfair (PPB) has two ostensibly different brands that nonetheless seem to be fighting for a similar looking pool of players. PPB have said previously Betfair is aiming for value-led customers and Paddy Power those who are entertainment-led.  Perhaps more simply it could be thought of as trying to compete with bet365 on one hand and Sky Bet on the other.

The view from the other side

There is clear separation in the marketing efforts, with Betfair ads looking more GQ than the FHM of Paddy Power. And there is, we are told, an attempt at a similar brand differentiation into value and entertainment at Ladbrokes Coral you have to look a bit harder to see it. Coral’s new TV adverts follow a similar theme as Betfair with the slogan “don’t bet silly, bet savvy” looking to appeal to a more sophisticated bettor. But the adverts themselves are harder to differentiate from those of its sister brand in the red corner on first inspection.

That’s not to say the two brands are not differentiating, but it’s perhaps a suggestion that there is more overlap between their two customer cohorts than PPB lead us to believe? Or maybe that both campaigns will begin to diverge more in time? Or perhaps it’s more that the brand isn’t all that’s important here. We’ve seen how important product is for the casino vertical and product enhancements such as cash out or request a bets have seen huge shifts in the balance of power in the online betting sector.

And as we move from a more functional sports betting product designed to get bets on with the minimum of fuss to a deeper level of personalisation and engagement is there a lot more that can be done here? Is the product going to be the brand for the next generation of sports betting operators? It’s an interesting question to consider. Not least for those with two very large brands sitting on the same technology stack hoping to differentiate with pricing and some clever marketing.