But this battle for customers is not typical in other regulated European markets. In France, for example, guaranteeing the “best price” is not readily accepted by the authorities. Betclic’s marketing team was recently asked to present a new campaign to regulator ARJEL, as well as employ an independent arbiter to check that it was offering the top price, as its advertising claimed. “The French authorities are much more protective of their citizens and it becomes a lot more prohibitive to run such campaigns,” says Wright. Odds generation Behind the scenes, the evolution of the way odds are generated is also having an impact on what bookmakers offer their customers. While some of the larger, traditional bookmakers continue to use their own in-house trading teams to compile odds, many operators either outsource part or all of the function. Outsourcing odds generation to an automated technology provider removes the need to hire hundreds of traders, including often expensive specialists for certain sports. And while there is always a margin attached to any algorithmic model, bookmakers can still overlay their own variables to ensure their bias and overall risk is re?ected in their pricing. Warren Murphy, CEO at Sporting Index, says it is vital for those bookmakers to retain control of their pricing, whether it’s for marketing purposes or simply to manage risk. “The idea of outsourcing is growing because the vast majority of pricing is very close. This has made it somewhat commoditised, meaning bookmakers can outsource the whole lot, and then make minor changes their end, which is much more efficient. That’s when operators can add any margin they want; they can lengthen or shorten odds and manage liability. That’s the point they can add a differentiator.” A hybrid approach of both in-house and external odds generation has become a prevalent method among operators entering newly regulated markets. In order to compete against the likes of Bet365, for example, which plans to offer its vast product in Spain, odds outsourcing is the only way other operators can compete on a level playing ?eld. Matt Stephenson, business development director at BetGenius, explains: “Everyone wants to be able to offer a massive product. So if you are a bookmaker in Spain that would never normally take bets on snooker, you still want to offer that bet so you can say you have the same product as the big brands.” But no matter how prices are generated, every operator knows that the odds customers see on their screens is, for better or worse, what really counts. “The industry has really become much more about advertising. The days of the old traditional bookmaker are over; they must now be excellent marketers as well,” says Murphy.
“THE DAYS OF THE OLD TRADITIONAL BOOKMAKER ARE OVER; THEY MUST NOW BE EXCELLENT MARKETERS AS WELL”
Warren Murphy, CEO at Sporting Index
exchange, by its very nature, has forced traditional operators to become more competitive with their pricing, the result of which being that today, the punter is bene?ting from what is a vibrant and competitive market.” But when the average recreational bettor is simply after more bang for his buck, the lure of better prices, especially from ?xed-odds bookmakers, is likely to be too strong to turn down. From inside the industry, however, these promotions are seen as “the oldest trick in the book” to attract gamblers to their websites. Andy Wright, sportsbook director at Betclic, says the tactic is a double-edged sword, as those customers whose only interest is price are rarely in it for the long term. “You can cull your prices for half an hour and state that you’re the best price, but in fact you were probably only top price for a very limited period and you probably restricted customers betting on that price while you were. “The price war around football odds, for example, has been going on for some time. The likes of Ladbrokes and William Hill have driven down pro?t margins on Premiership football to the point that many UK bookmakers are betting to 102-103% on Premiership football of a weekend, because of the war that they started,” he adds.
“The likes of Ladbrokes and William Hill have driven down pro?t margins on Premiership football… because of the war that they started.” Andy Wright, sportsbook director at Betclic
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