Disruption mode: what the sports betting industry can learn from TikTok

LeoVegas Group’s director of sports strategy, Per Carlander, has always been vocal about the opportunities open to the industry around the use of technology.

At ICE Barcelona earlier this year, Carlander noted two key themes in sports betting: rich data and entertainment. On the latter in particular, he homes in on the reality that the sector is not just competing against other betting operators but also the likes of TikTok, Netflix and other gaming apps.

Here, Carlander considers how innovation in sports betting has evolved since he joined LeoVegas Group in October 2022 and the key to making products stand out in a crowded market.

EGR: What changes have you seen in sports betting in terms of innovation since you joined LeoVegas Group more than two years ago?

Per Carlander (PC): The biggest change I have noticed since I started, with how we work with innovation, is around localisation. We have always wanted to have a global product that could fit any need in any of our markets, but with the pace of local regulations all across Europe and now Latin America, we realised you need to be very localised to be relevant in each market.

So, that dictates a lot of our innovation and product development now. That has been the biggest change because now we do a lot of user research in all our markets. And then, of course, the foundation of a great product doesn’t differ too much when you compare the UK to Brazil or Spain, but that little extra layer of innovation, that differs a lot. Now we are focusing a lot more on local adaptions and USPs than we did two-and-a-half years ago.

EGR: In a recent interview, you mentioned the industry is competing with the likes of Netflix and TikTok. What can the gambling sector learn from these companies?

PC: TikTok, Netflix and other applications have disrupted their niche of the industry a lot by being super customer-focused or customer-obsessed in different ways. What they do really well within their niche is serving people what they want. As a customer, when you open an app, or if you go into a store or restaurant and you get the feeling that they really know what you like, almost better than yourself, then that’s a great feeling.

And that’s the common thing with these disruptive companies, that they have found a way to know their customer better than anyone else. They then take all of that knowledge and package it really well and present it to you. It’s something I don’t think anyone has really done within the betting industry. Different companies do good things, but I don’t believe we have seen that kind of disruption yet on a bigger scale. So, hopefully, that will be us.

EGR: How is LeoVegas Group adapting its product offering to attract a more digitally savvy audience?

PC: LeoVegas Group is still a pretty young company – we were founded in 2011. Our advantage compared to some other operators that’ve been around for longer is that we were founded mobile-first. So, that has given us some advantages compared to earlier [established] companies that were focusing on desktop and all of that. So, that was the foundation.

Then, what we have realised over the last couple of years is if you look at age groups between 18 and 25, their attention span is very short because they are used to media that goes super-fast and super-quick – if you don’t get hooked after two seconds, you do something else. And that’s something we really try to incorporate in our [user] experience today. How can we make our product stickier? How do we put what we think is the most attractive offering for the customer when they enter the site or open the app? There’s a lot focused around that. People in general don’t have the patience to scroll around and look for a long time. That’s the biggest difference.

EGR: Sportradar CEO Carsten Koerl said last year that he believes firms that don’t embrace AI will be out of the market in three years. Do you agree or disagree with that?

PC: Yes, I would say I totally agree. But also, AI is not a new thing. We and many others have been working with it for many years. The language models, ChatGPT and that, are pretty new. Three years from now is a very long time in our industry, especially when you’re considering AI. Rather than fall in the trap of guessing where AI will be in three years, or where it will take us, we’re pretty focused on how we can use AI right here and now.

The human brain doesn’t have the capacity to grasp exponential growth. We have no idea where it [AI] will be in three years. So, I would say we are very focused on the here and now but also try to remember AI is, of course, going to change everything. But more traditional recommendation models and personalisation will always be important for our industry, so we won’t say, ‘Okay, let’s go all in on AI’ and then not work on our foundation anymore. So, we are pretty pragmatic around AI.

EGR: What are some of the main uses of AI at LeoVegas Group, and how much potential do you see with it?

PC: We have used AI and more traditional machine learning for many years. We use it for the detection of problem gambling, for example, that’s one of our biggest uses for AI right now. It works really well, and it develops really fast as well.

In general, we use it mostly to create more internal efficiency – making software development more efficient, more time saving for customers on-site etc. I read an article the other day about Microsoft’s new Majorana 1 that blew my mind a bit. Microsoft has found a fourth material – it’s not liquid, it’s not gas and it’s not solid. They can use that fourth material to stabilise quantum bits. We make a lot of calculations but, if the material gets disrupted, you need to start over again.

But this more stable material can make all those billions of calculations without starting from the beginning again. At the moment, you need a lot of attempts when you’re trying to create the perfect product or solve a very difficult issue. But if that material works, you will get a perfect product at your first try. It’s very interesting to think about, but it will still be a couple of years from now when we will find real use cases about it.

EGR: In the past, you’ve spoken about why sports betting should be more like Tinder. Do you still hold this view?

PC: I do because that industry moves really fast as well. I said that one or two years ago, but maybe now Tinder is a bad example because there are other apps in that niche that are more disruptive. But I would say, in the context of what we spoke about in the beginning, they [apps like Netflix, TikTok and Tinder] changed the whole industry by implementing a new UX. People were not used to that. And then all of a sudden, within a couple of months, that’s what people expected. But a lot of sportsbook operators are still very traditional. Of course, the product has improved over the last 10 years but it’s still pretty static; you kind of get the same experience no matter what brand you enter. Basically, I think we have a lot to learn from other disruptive companies in other industries.

EGR: Some people in the industry have said a lot of product innovation is coming from crypto gambling operators now. What are your thoughts on this?

PC: I can agree to a certain extent. Some of them have really great products and they are developing and changing the products at a very fast pace. We are only active in regulated markets or very soon-to-be-regulated markets, and that’s a strategic choice. But being active in 10 to 15 different local regulations also brings a lot of extra overhead costs because it’s complex, you need to comply with the regulations and do the reporting. Then, of course, you need to pay local taxes. So, our profit margin that we have the possibility to reinvest into innovation may be a bit smaller than operators that have chosen another path and are not going into local regulations. I think that’s probably a bigger piece of that [contributing factor] than just that they are crypto operators.

EGR: BetMGM launched in Sweden and the Netherlands in 2024. How do you ensure your sports betting product stands out from the competition in those markets?

PC: With Sweden and Netherlands, before we launched BetMGM in those markets, they were two of our strongest sportsbook markets already for our other brands, LeoVegas and Expekt, so we had a pretty good foundation to build on. We had good user insights. We had the product that was working already on other brands. Connecting back to what I said in the beginning, what we have done is taken that foundation and added a brand flair from Vegas and all that that brings us. But we’ve also added locally specific development on top of that.

In Sweden, for example, we have added something called the ‘MGM Tipset’, a pool betting product for football and ice hockey, which is very big. I think it’s almost 30% of the Swedish gambling market. We didn’t have that vertical before, but that’s something we have added on top of our sportsbook in Sweden. We have also introduced a concept called ‘Super Swedes’ where we lift out Swedish sports stars and create unique markets around them every day. So, it’s those smaller things that we try to add on top to stand out from the competition.

EGR: With the likes of Robinhood, Kalshi and Polymarket offering sports events contracts, do you see this as a threat to traditional sports betting operators at all?

PC: We [the gambling industry] don’t have many examples where other companies enter from other industries. Maybe the best example is Sky Bet. It came from the media industry, moved into betting and is now one of the market leaders in the UK. I still think we will get disruptive companies from other industries into our sector but I’m not sure if it will be around future contracts or something else. But, if you look at it from an outside perspective, Robinhood in the US has a perfect customer base to also offer betting, or close to betting products. So, I definitely think we need to keep our eyes open to other sectors that may try to get into our industry, for sure.

EGR: What’s next for innovation in sports betting?

PC: Right now, I think most betting companies have a one-size-fits-all product, to be honest. Of course, we make changes, order the content in a different way and recommend different events but, in essence, it’s kind of the same. I think we will move away from that.

As a brand, maybe you want to offer a traditional experience because it will always be there, or at least be there for a very long time, as a lot of our customers really appreciate that, and we don’t want to close them out.

But perhaps your brand wants to also offer a completely different experience to someone else. So, let’s say, ‘TikTok betting’ or ‘Tinder betting’, where it’s a completely different experience that is curated only for you. It’s very light, not with lots of different markets, but rather you open up the app or site and get served with content that we think you like. I think you will see one brand umbrella, but it will offer different experiences to different customers when they log into the site. And you will probably have some mixes in between. So, I think it’s going away from a one-size-fits-all [product] to more of a totally different UX for different customer groups.