LeoVegas CEO on taking share in Sweden and revitalising the UK
Gustaf Hagman also discusses the marketing ban in Italy and uncertainty in German online casino
LeoVegas yesterday reported an 8%cc rise in Q2 revenues, although the firm’s share price dipped 5% as it continued to struggle in the UK market. Following the results announcement, EGR caught up with LeoVegas CEO Gustaf Hagman to find out what’s driving the company’s growth and how it plans to revitalise the UK market.
EGR Intel: How are you planning to improve performance in the UK?
Gustaf Hagman (GH): It’s a little bit of a constant battle in the UK. I can’t really give you any quick fixes, it’s more about adapting to the market and trying to focus on product innovation because I strongly believe that if you have a great product that in itself creates a good customer journey, which in itself creates customer loyalty and then the customer will come back to you as a company and a brand.
EGR Intel: We’ve seen several companies recently talk about focusing on one or two primary brands rather than a multi-brand approach. Would that be an option in the UK?
GH: We will continue to have a little bit of a different approach where LeoVegas and Royal Panda are global brands and then locally we have the RocketX brands in the UK. They are specialists in Google, so you will see a couple of those brands on the front page of searches in the UK. So it’s a little bit of a different brand strategy than some of the other guys.
EGR Intel: You suggested you’re taking market share in Sweden, so what are you doing well there currently?
GH: We’ve been present in Sweden since the launch of LeoVegas back in 2012 and people love it. It’s a great brand, great customer journey, and good customer retention. All that ties into why we’re taking market share in Sweden. But also the fact that we know how to handle regulated markets. We are present in seven different regulated markets and that’s also a competitive advantage compared to some of our competitors in the Nordics.
EGR Intel: How have you found your interactions with the regulator there? Plenty of operators have reported issues with communication.
GH: We haven’t had any bad experience there. I would say you could ask for a little bit more clarity when it comes to the marketing. What is moderate marketing? That’s one of the questions that the industry is constantly asking the regulator in Sweden. We need to know that because otherwise how can we adapt to something where there are no guidelines?Intel: Can you share more details on what was moved to Malta?
GH: It’s always a constant work around efficiency in the organisation. Certain types of services need to be done in Malta and other ones need to be done in the UK. We still have our office in the UK in Newcastle. It’s more of an organisation change and an ongoing process to be optimised across the business in terms of job losses. It’s nothing substantial.
EGR Intel: How have you been affected by the ad ban that kicked in recently in Italy?
GH: Actually, we haven’t seen any negative effects from the ad ban. I know it’s early days but the Italian numbers are official from the Italian regulatory body, and we’re gaining market share in Italy as well.
EGR Intel: There seems to be plenty of uncertainty around Germany and whether online casino will be allowed going forward. How do you view the market?
GH: The German market is a little bit day to day. Sometimes one quarter they are talking about prohibition on casino and other quarters it’s business as usual. It’s really hard to say. We know that as of now it’s status quo in Germany and we are continuing as such. It’s important to remember that we are paying the VAT and the sportsbook tax so it’s a semi-taxed country for us.
EGR Intel: And if PayPal is switched off for operators there as seems likely?
GH: I think in general, PayPal is a quite well-used payment solution in Germany. However, we’ve been working a lot with other payment solutions to mitigate the effect of PayPal if that was turned down.
EGR Intel: Anecdotally, it sounds like Latin America is booming for operators at the minute. Is that your experience?
GH: We just went live in Chile, Peru and Brazil. It’s early days but it’s promising. There’s good momentum when several operators move in at the same time, it creates a kind of echo and a good environment.
Gustaf Hagman, CEO LeoVegas