Five industry trends to watch out for ahead of the new football season

Something big is coming. Something that could change the future of the online gambling sector for good, or possibly for bad. This August will see the start of the 2019-20 season of European football and, either way, the industry is unlikely to come out of the other end the same way it started.

From advertising to data, from sponsorships to legislation, this feels like a potentially massive season to come. So let’s look at five things to look out for:

Go big

At present it’s the calm before the storm, but probably the surest bet this season is we’re going to see some major promotional offers and campaigns from the big players this season. With growth rates slowing, advertising restrictions kicking in and competitive pressure arguably higher than ever, this is not a season for caution.

The market for request-a-bet and build-a-bet markets in particular is likely to be fierce, as will in-play as operators look to grow revenues through share of wallet as much as market share gains. The start of the domestic football season is not traditionally the scene of huge acquisition campaigns as seen for racing festivals and major football tournaments. It’s more of a marathon than a sprint with players acquired, reactivated, retained and monetised throughout the long season ahead, but this only makes the promotional intensity that much harder to sustain.

We’re already seeing bet boosts, cash-backs and early payouts across a number of sites and all will be keen to offer something stand-out this year. If the likes of Sky Bet or bet365 really want to exercise their promotional muscles we could see something as game-changing as Sky Bet’s Cheltenham offer this season.

Or go home?

One area that seems likely to be a direct consequence of the expected rise in promotional intensity is the increased pressure it will place on new entrants to the major markets and on non-local operators hoping to capture share. For operators in key markets with 1% market shares, this could be a make or break season as they find the bar raised and revenues ever more squeezed. And while the UK is the obvious case here, this is also likely to be true in Germany, Italy, Spain and the Nordic markets.

Sports betting is becoming an increasing game of scale and if you have no local advantages then it is going to be a very expensive game to play in not least when regulatory demands continue to rise. And it would be no surprise to see some operators pull out of or scale-back from the UK or other major markets during the course of the new season. One other factor that could come into play is the rising interest in Asian, African and now crypto currency operators targeting the UK specifically for sponsorships that speak to an audience way beyond the local market.

Could we see some media and regulatory backlash to these that calls into question to what has become a huge marketing channel for grey market firms? It’s certainly not impossible.

The shirts off our backs

Sponsorships generally seem to be a hot issue across Europe with no obvious industry consensus about what the correct approach is either for now or the future. Italy have taken mattes out of operators and the league’s control with their advertising ban and it would be no surprise to see Spain take a similar view in the near-term with its new government previously opposed to gambling advertising. And other markets look vulnerable to shifts in legislative or regulatory mood, not least the UK.

We’re delighted to unveil the new @htafcdotcom home kit for the 2019/20 season! https://t.co/yf1eFZIyRe

— Paddy Power (@paddypower) July 17, 2019

At the time of writing, Paddy Power seem in the midst of a new stunt that will doubtless draw some negative attention to the huge business of gambling shirt sponsorships in the UK with both the Premier League and Championship flooded with egaming logos on the front of team’s kits. How this all gets resolved seems impossible to envisage without some form of regulatory or legislative change and that will likely depend on the timing of the next election in the UK as much as anything with the Labour party are likely to push back if it comes into power.

The current mood is not strongly in favour, and GVC drawing its line in the sand over the issue is sure to remain a talking point within the industry and who knows what the end result of the latest Paddy Power shenanigans will be. This is another area to watch with interest.

VAR – variable additional regulation

Regulatory change is likely to go far wider and deeper than simply sponsorship, however, with several key topics yet to be decided on from the Gambling Commission. The biggest of these is the area of affordability checks, which have been mooted in the past and it appeared to make a guarded reference to in a recent report. But there are also consultations ongoing on the use of credit cards and a wider range of measures to reduce gambling harms.

In addtion, there is an ongoing debate on advertising with an interim report released last week where the Gambling Commission noted the “final phase of the research and subsequent findings” will be published later in 2019 and will focus on “the impact of gambling marketing and advertising”. It would be a brave person who expected the end result of all this to be no change, and in the interim it means operators are flying blind to a certain extent.

It’s easy enough for commentators to say the industry should be acting more responsibly, but harder to define what that means in practice and how much of a hit they should take commercially prior to any new guidelines coming out. Caution should probably be the watchword here, but this is easier to say than do when looking at the competitive environment.

Data warfare

As mentioned in a previous article on EGR, the issue of data is also likely to become a bigger point of conversation and contention over the next season, not just in the Premier League but in a number of European leagues. Who owns the data, what it costs to operators and how much value it brings to all vested interests is something that hasn’t been fully defined yet and retains as many questions as it does answers. And with in-play looking to be an even more important and competitive market than ever over the next season or two the role and position of data and the companies providing it will only become a more significant factor.

We could see legal challenges on all sides, or we could see a shrug of the shoulders and the absorption of yet another cost into the mix. What we absolutely need from this season, however, is some clarity on how to move forward and some innovation into the in-play product as a result if either operator or customer is going to see any benefit here.

This is by no means an exhaustive list too. There are a number of other issues that could raise their head during the season, and the biggest one of all hasn’t really been touched upon.

How big can this market get? Among the top tier firms there is a huge need to drive revenue growth through football betting in 2019 and 2020 but there is an increasing question as to how high the ceiling is in the UK market in particular. How many more new players are there out there and how much more share of wallet can really be achieved, not least with an eye to responsible gambling?

These are really big questions that the industry needs to answer and you sense it’s got the next nine or ten months to begin to do so.