Poll: Should operators be concerned by self-exclusion impact?

William Hill shares nosedived 12% last week after the operator issued a post-Cheltenham profit warning. And arguably the most concerning part of the trading update was the number of customers opting to self-exclude or enter a cooling-off period, which has risen to as many as 3,000 a week.

The firm estimated the full-year financial impact could be as much as ?25m, with the customers that use these self-exclusion tools worth up to four times as much as a typical punter.

Previously gamblers wishing to self-exclude had to phone the William Hill office, but recent changes mean the process can now be done online in just three clicks.

Hills boss James Henderson also warned there could be more pain to come with ‘reality check’ customer pop-up warnings, similar to those seen on FOBTs, set to be implemented at the end of April.

There are also concerns that the mainstream press coverage of the Hills’ profit warning will have alerted even more customers to the existence of these self-exclusion tools, creating an even bigger impact on profit down the road.

But it would appear William Hill has been disproportionately affected by the introduction of the self-exclusion and cool-off tools, with a number of its rivals telling eGaming Review they were “surprised” at numbers reported by the operator.

“While we are expecting some impact from the self-exclusions, we were surprised to see the scale of the impact Hills is already predicting,” said one major operator.

The ?25m hit represents about 4.5% of Hills’ full-year revenues – more than the 3% that the Global Betting and Gaming Consultancy (GBGC) has previously estimated social responsibility requirements would cost the industry in 2016.

However, with the introduction of more self-exclusion tools, including a national self-exclusion database where players can block themselves from all sites, the GBGC expects social responsibility requirements to cost the industry 15% of revenue and 35% of profits in just five years’ time.

With this in mind, this week’s EGR poll asks how concerned the industry should be about self-exclusion tools. Is William Hill ahead of the curve in assessing the profit-busting potential of these tools? If so, do operators need to start planning for similar hits to their own profits?

Conversely, is it possible that William Hill has overstated the impact of these tools, as its online profit slump is rooted in a variety of other factors, including increased taxation, a catastrophic Cheltenham Festival and rapidly growing rivals?

Have your say on the right hand side of the page.