Interview: We'll go "aggressive" for World Cup, says GVC chief exec
After a transformative 2013, GVC's chief exec Kenneth Alexander tells eGaming Review how its Sportingbet and Betboo brands will play it shrewd this summer
After what can only be deemed as a successful year, GVC Holdings chief executive Kenneth Alexander is enthusiastic about what the future may hold for its stable of betting brands.
Yesterday’s Q4 results revealed encouraging signs of underlying growth with sports betting stakes up 19% and gaming revenues up 12% sequentially.
And having led the Group through its successful acquisition of the bulk of the Sportingbet business in March, Alexander now finds himself with arguably the two biggest betting brands in Latin America with a Brazil-hosted World Cup just months away.
GVC sportsbooks Betboo and Sportingbet lead the way in unregulated Latin America and recent estimates put the Group’s revenue derived from the region at around 16%. The opportunity to increase this figure hasn’t been lost on the former accountant.
“The World Cup is in Brazil and we consider ourselves to be the biggest player in sports betting in Latin America so we are pretty excited by 2014,” Alexander says.
Marketing battle
Yet despite his excitement, Alexander says GVC won’t be swept away with the expected World Cup marketing battle “ something he believes has previously lured operators into offering unwise promotions in a bid to win market share.
“Everyone will be rambling around trying to boost recruitment and I’m sure in previous World Cups and European Championships there has been all sorts of ludicrous marketing campaigns,” he says.
“We are going to be aggressive but at the same time we are not going to be kamikaze and we are not going to waste money. We are all about making profits not generating growth for growth’s sake, so any marketing spend will be used to develop a long-term return to generate cash and then we’ll reward our shareholders as a result.”
One area GVC hopes to improve in this year is in mobile. According to Alexander, revenue derived from mobile platforms is hovering at around the 20% mark “ way behind the likes of Paddy Power, which attracts 47% of total revenues on mobile devices.
The Group is currently working on a series of improvements which it expects to unveil before the World Cup kicks-off in June.
“We are always looking at improving our mobile products,” Alexander says. “We’ll have some improvements before the World Cup for sure and we are definitely looking to improve that [20% figure] and we expect that to grow over the next year or so,” he adds.
Regulation
Following on from the takeover of Sportingbet, which now makes up roughly 40% of GVC revenue, the Group this week switched regulatory regimes from Alderney to Malta. The move stemmed from GVC’s decision to close Sportingbet’s Channel Island operations and redeploy its employees to its Malta offices in a bid to cut costs.
“It was a big, big, project which we had been planning for six months or so,” Alexander says of the switch.
On regulation, Alexander makes clear the Group has no current plans to apply for any further licences in regulated countries or pull out of those without a regulated market in which it operates. GVC has been a recent beneficiary of the gradual withdrawal of rival operators from unregulated markets such as Turkey and Germany, a trend he has no desire of following.
“Our plans are we don’t have any intentions of exiting any of the markets we are currently in,” Alexander says. “By in large, we are in the same sorts of markets as everybody else and we remain committed to growing our market share in those markets over the next 12 months as aggressively as we can.”
The Group currently holds a number of licences in countries such as Denmark, Germany, Italy, South Africa and Malta.
“We’d like to have a licence in them all if they were taxed sensibly but it’s not possible so we are no different to most of our competitors – when we can get a licence with sensible taxation and sensible regulation we’ll go for it,” he adds.
With the World Cup looming on the horizon, and with Alexander also open to the idea of making further acquisitions, there’s barely time to reflect on the year that’s past.
“I have to say I’m pretty pleased with 2013 and of all parts of GVC but now it’s onwards and upwards with regards 2014.”