888 says sports cross-sell a big factor in growth

888 chief executive Brian Mattingley (pictured) this morning described the 115% year-on-year growth enjoyed by its burgeoning sports betting business as the firm’s “undoubted highlight” of 2014 with the vertical acting in part as a strong acquisition channel for its “overperforming” casino business.

The operator’s revamped 888Sport product, launched in tandem with sportsbook supplier Kambi Sports Solutions back in May 2013, has been pushed aggressively by the firm both in the UK and more recently in Spain, where it was released in August last year.

Although 888Sport’s true numbers are obscured by the fact they are reported among the company’s ’emerging offering’, the bulk of the $29.9m (£20m) recorded in 2014 was derived via its sportsbook.

And Mattingley told eGaming Review this morning that the 16% boost to casino revenues was partly attributable to the fact that 888 has managed to cross-sell customers into the flagship vertical.

“This time last year we said we saw great opportunity in sport and Kambi our partners have been superb – its risk management is very good and we have increased the number of live events,” Mattingley said.

“More importantly, however, we connected it to our back office, we are driving CRM through it, we are driving our marketing campaigns and we have been very successful at cross-selling.

“One thing we were always aware of is that the sports betting customer migrates well to casino, and to a lesser extent to poker, and we have seized on that and done very well,” he added.

The question is where 888 takes sports next. Using a third-party provider in the long-term doesn’t fit with its wider strategy of developing propriety software, as it has already done with poker, casino and bingo.

“At this moment we are not [developing our own sportsbook software],” Mattingley said.

“The resources we have got are limited. We have a very large development team but a lot of that is taken up by other things at the moment. I’m not sure if we would actually develop our own but what you may see is that we’d maybe acquire someone that has got that sports technology,” he added.

The immediate next step for sports appears to be a launch in Italy, where sports betting is currently enjoying a period of growth and where Kambi is said to be developing a product that complies with local regulations.

“There is a very strong possibility that we will get a sports licence in Italy,” Mattingley said. “So I believe it is something that we should be looking at and will be looking at this year,” he added.

888’s total revenues for the 12 months of the year grew 14% to $455m (£304m) while adjusted EBITDA increased 32% to $101m (£68m) during the period.