End product: Kindred Group's Erik Backlund on switching from sportsbook to CPO

After spending more than a decade heading up Kindred Group’s sportsbook division, Erik Backlund finds himself in a new hotseat. Appointed chief product officer (CPO) in October to replace the outgoing Fredrik Kjell, the former Siemens marketing manager has reached a new zenith after almost 16 years with the Stockholm-listed operator. Stepping up to the plate during one of the most tumultuous periods in the industry’s history, Backlund believes that a renewed emphasis on product can act as a much-needed catalyst to power Kindred through those regulatory headwinds and into the hearts and minds of consumers. Speaking to EGR Intel, Backlund details his veteran career in the industry, how Kindred’s US penetration rests upon product specifics, and what the future holds in terms of innovation. EGR Intel: How does it feel after spending 11 years as head of sportsbook to make the transition to CPO? Erik Backlund (EB): It’s a different level. The key difference is the level of decisions and group strategy involvement that you step up to. I think it’s an interesting time to do that, there’s a lot of change in the industry around the US and European markets. It’s challenging but also very rewarding. It’s a bit weird because the pace of the industry has always been very high but now it feels like the pace is picking up to a new level. I’m an expert in terms of sports betting and sportsbook and I’ve been working for over 15 years in that area, but that doesn’t mean you’re not involved with other parts of the business such as the overall product portfolio or the commercial area. EGR Intel: Did the promotion come as a shock after being in the same role for so long? Did you think this opportunity had perhaps passed you by? EB: I think that one of the reasons I stayed for so many years within the same department, in my position as head of sportsbook for almost 10 years, was the amount of work needed to build up the Kindred sportsbook team since the decision was made to create Kambi and separate them into two companies. Firstly, it was to ensure that we could make Kambi a success, and at the same time grow Unibet and find an identity for Unibet going forward. We have also acquired a lot of businesses over time such as 32Red, Stan James, Betchoice in Australia and Eurosport.bet in France. This comes with a lot of challenges and a big focus has been on how to integrate those businesses, both from an organisation perspective, but also from a product perspective. Now, as CPO, there are similar challenges. We still have legacy platforms and we still have the changing European regulatory landscape. We’ve got US states to enter and adapt the platform, product and organisation for, to ensure that we create scalability and we are as successful going forward as we have been in the past. It’s the same kind of challenges but on a different level. EGR Intel: Kindred is live in the US with the Unibet brand – is the product unique enough to cut-through the market? EB: The US customer is a different creature than in Europe. The demands and expectations are very different to those of the European and Australian customers that we are used to. There’s a lot of work in the beginning to ensure that we can tailor-make products for US customers. This can be anything from the types of sports to bet markets, which casino games we offer and the UI. Just like in Europe, the product is key. In the US, where there’s a clear difference in the kind of offering state-by-state, this adds complexity and it means we have to be compliant with those regulations – it is not one-size-fits-all. I think one of the things that could be quite easy to do is to patronise American customers. Just because sports betting hasn’t been legal for long, it doesn’t mean they don’t know what they like. If you look at the products that are popular in the US, it is a little more regressive than in Europe. I think it is important to move at their pace and not run ahead because of European heritage. I think it is kind of a balance. It’s an educational piece, both for the operator and for the customer where we need to educate the latter about online betting, in-play and elements like that, and the customer also needs to educate us in terms of what makes them tick. EGR Intel: Similar to a symbiotic relationship where you work together to find the best fit? EB: Exactly. It’s important not to be too nonchalant and think you know best. You need to take a step back, look at customer behaviour and assess how that will be important to your brand in terms of taking market share. EGR Intel: What was the thinking behind launching your own pay and play casino brand (Otto Kasino) in the Nordics this summer? EB: Pay and play has gained quite a lot of popularity in recent years, especially in the Nordics with challenger brands going against the more established, traditional sportsbook brands and local monopolies. It matches a change in consumer demand. I think the players can see that pay and play is the perfect opportunity to get in and out, with instant withdrawals and no long registrations. It is a form of anonymity that is quite attractive in today’s society of data collection. It sounds like the perfect combination of product and social demand, but for us there are also potential restrictions with the concept. We know less about our customers with the kind of data that is collected on playing history, and that is needed for personalisation and responsible gambling requirements. We had to adopt some of the tools we have in order to help customers identify problematic gambling behaviour and I think in the end, with Otto Kasino, we have cracked that. We created a new, fast casino but we still managed to keep that personalised experience in terms of the front-end while offering our customers the responsible gambling tools that we have developed under the Kindred umbrella. EGR Intel: What is Kindred’s plan for the German market following regulatory changes in the country? EB: Germany is a big betting market and it’s in our heartland. We are a tier-one European operator and we have the ambition to have as much regulated revenue as possible – as long as the conditions are workable and not completely impossible to adhere to. In all those markets where we are active, we aim to comply with the local regulations. I think there is more to be said about German regulation and a lot of unknown aspects still. However, at this time, we are adapting a platform and product to be compliant and we are looking forward to a regulated and competitive German market going forward. We currently have the Unibet brand active in Germany and we intend to keep it there. If there will be another brand or brands on top of that, then we will have to evaluate that as we go along. EGR Intel: Do you think the roadmap in your new role will be a case of carrying on Fredrik’s work or are you putting a brand new vision in place? EB: For me, I think it’s an evolution. Our strategic challenges from two or three years ago are very different from what they are now in terms of market footprint, regulations and supplier landscape. I have to constantly challenge my product team to ensure we are compliant, innovative and putting product at the forefront of Kindred. With an ever-evolving landscape, if you snooze you lose, and that’s why the focus is on scalability across the business. That’s why we’re investing a lot in the platform and product and constantly have to evolve as a product department to support the organisation. EGR Intel: Kindred said a strong focus on product diversification helped deliver strong Q2 results – what’s the significance of developing alternative verticals? EB: I think it is important. It is not just product but the brand as well. The fact that we have multiple brands with different positioning and different kinds of product proposition is an important part of the puzzle. On the product side, it’s key to have a supplier base that is broad so you can optimise per market by having a good, scalable platform. If a majority of the user journey of our customers is outside our own platform or not in an environment controlled by us, I think that’s fine, but that’s also one of the reasons why we are focusing on taking ownership of that front-end packaging. That’s why we are building our own sports betting front-end on the Kambi APIs and ensuring that we are using our own algorithms and tools in terms of personalisation. If you don’t have that control on the front-end, you might not deliver on that brand promise or on what’s important for the customer. I think that’s the key focus when it comes to product control. EGR Intel: What examples of differentiation are in the pipeline for Kindred? EB: The key in the US will be to build the right partnerships. These partners will help us to develop our products in the right way and to stay ahead of regulations and seize the right commercial opportunities that arise. The launch of the Unibet Philadelphia Eagles blackjack game is one example, and the early customer uptake has been very good since launch. We are also working on an Eagles slot game. Product differentiation will be key going forward across all markets, and another great example of that is the exclusive bet types and experience we are offering our customers on Allsvenskan, the top football league in Sweden, where we are the main sponsors. It includes a collaboration between Kindred, the league and an external partner to provide fast data and create exclusive bet types around that data while using individual club logos and images. EGR Intel: What are your hopes and expectations as CPO of Kindred over the next 12-24 months? EB: We have grand ambitions to continue our growth in the UK. We need to ensure that we can sustain and grow on our position in the Nordics and Western Europe, while also preparing for the US in a controlled way. All of this puts pressure on ensuring we have a scalable product that is ever evolving when it comes to innovation. When we do partnerships in different markets, it’s important from a product perspective that we are agile, which is the fun challenge of being active in so many markets. Whether you are a brand manager or country manager for one of the Kindred brands, they all expect to have a competitive product, whether that means having a strong central product that can compete with the likes of bet365, or local products that can compete against monopolies and casino-specific operators. My challenge is to create a team and a product portfolio to show that we are in a position to do that and deliver on our strategic intent to become the number one operator across all our markets.