Q&A: Buzz Bingo CEO on being "ahead of the curve"

Full-year (FY) 2023 was a strong one for Buzz Bingo, but CEO Dominic Mansour has his sights set firmly on an even better 2024.  

There has been plenty of change at the Nottingham-based omnichannel bingo brand in the past 18 months, which includes Mansour’s predecessor Chris Matthews stepping aside and David Evans being named as Buzz Bingo’s first-ever chief product officer (CPO). 

The firm itself conceded that 2023 was a “year of reset”. But that sort of turbulence did not stand in the way of impressive growth for both the retail and online segments, with the latter posting a 31% year-on-year (YoY) rise for the 12 months to 13 January 2024. 

Average online customers, new online customers and online customer spend were all on the rise, while the omnichannel strategy deployed by Buzz Bingo continues to prove fruitful with 44% of online players coming from customers who had initially first played in the company’s retail clubs. 

The first half of 2024 has been even more impressive so far, with May seeing Buzz Bingo confirm the acquisition of two MERKUR-owned bingo clubs that Mansour, along with the rest of those at the top of the company’s hierarchy, hopes will inspire a 10% rise in retail revenue. 

In light of Buzz Bingo’s FY 2023 results being released, EGR caught up with Mansour to talk everything from economic pressures to the potential impact of September’s £5 cap on online slots. 

EGR: How are you feeling about the past 12 months following the strong financial report? 

Dominic Mansour (DM): The long and the short of it, [we are] pretty happy with FY23 and the direction of travel of the business. I know you guys think more about digital than retail, but we really look at them as one connected business. While retail is a huge portion of our overall revenue, the performance of our digital business has been absolutely exceptional.  

We can see that we’re significantly ahead of the market trends which, frankly, were always put down to the fact that we’re able to acquire so many customers through our retail channel. The cost of acquisition is insanely cheap by comparison to what an online-only operator must contend with. 

In parallel, the value of them is two or three times that of a normal online customer as well. The result of all of that is a digital business that’s frankly flying, a retail business that’s returning a little bit to growth and putting ourselves back on the right foot.  

We suffered a lot during Covid. It was an expensive time to keep a retail estate open. So last year, we really reset the business and costs aggressively and in parallel, we were able to grow our revenues across both channels. We’re pretty happy with where we are right now, on our five-year journey. 

EGR: Buzz’s online arm recorded revenue growth of 31% YoY. What do you put that significant rise down to? 

DM: We do get an immense number of customers coming through retail. That’s kind of number one. But what we’ve done is we’ve tried to innovate in digital.  

I remember when I first started looking at the business before I joined and the very first thing I wrote down was ‘me too website’. It just looked like another bingo site. 

We’ve tried hard to differentiate ourselves and try to play to our retail presence as an advantage for the digital business.  

The live bingo that we’ve introduced has been a phenomenal success. What we’ve seen off the back of that innovation is a lovely halo effect to longevity of sessions, halo effect into other games they play, more slots than they would have done and we’re no longer a ‘me too’. So, we’ve got a point of difference which I think has attracted a lot of customers. 

EGR: Online spend per player is up 10%. Given the economic pressures and wider industry push to a more recreational player base, how has this been delivered? 

DM: We moved to the recreational player base three years ago, so we got ahead of the curve. We felt there was this space in the market [that] at the time was pushing for high-value customers. On one end, you had the whole market concentrated in that area, and tombola who was sort of an extreme side, where they were very, very recreational. 

For a long time now – it’s been three years – we’ve had a low stake cap of £10. We’ve cut that from £50, way before the Gambling Commission (GC) started slapping everyone’s wrists with these issues. That’s worked really well for us.  

We design all our promotional activity in that same direction as well. We’re not looking for high-value customers – I think our biggest customer loses £2,500 to £3,000 per year. Many of the operators get that in a day and it smooths the underlying performance of the business, so it’s easier to manage. You don’t get massive peaks when the big guy loses a ton of cash. You don’t get massive troughs when the guy wins a ton of cash. 

EGR: How has the launch of your online casino platform impacted online operations? 

DM: Really well. We felt we needed to diversify. We may look for further diversification in the future as well. We wanted to appeal to a slightly different customer base – to our broader bingo customer base – and use it as a secondary channel for lapsing customers. That was the original thesis about launching, so we’ve got something to cross sell them into and that’s worked really well. 

What we hadn’t anticipated was the pick-up we’ve had of customers specifically looking for casino in the first instance. That’s been a bit of a bonus. And I think that comes down to really strong SEO that we get the halo effect of. We perform well [when it comes to] bingo SEO stuff. So, connecting that with the casino site has helped us. 

EGR: Half of your retail club visitors in 2023 (about 100,000) were under the age of 35. Are you seeing a similar demographic engage with Buzz Bingo’s online offerings? 

DM: Online has always been a bit younger than retail. The traditional sort of retail customer is one that is much significantly older. We’re excited that we’ve got younger customers coming through the door in retail, but it is a reflection of our online customers. It’s a much nearer profile to what we have online.  

We’ve also become better at doing the journey the other way around. All I’ve spoken about is retail to online. We’re getting better at going online to retail. 

We found that a decent number in the old days – that was like 0.1% – would go [from online to] play in club. Now, north of 15% to 20% are using that journey. I think that ties in because it’s the profile of an online customer who’s typically younger, so that’s why they’re going hand in glove. 

EGR: Do you foresee any impact from September’s £5 cap on online slots or the financial risks check pilot due to be put in place next month?  

DM: We did go early on that stuff. So, [we’re] not remotely concerned. If anything, a bit more on the positive side than on the negative side. I’m keen that as an industry, we have a level playing field. 

One of the things we saw when we put the £10 cap in was that nowadays, with the requirement from the GC to demonstrate source of funds of your customers, it became near-on impossible to reclaim customer winnings. Typically, what would happen is a customer wins big on a day and very quickly, they’d lose the money back to you. That’s the old model of online gaming, per se.  

What’s happening now is if you had a big stake cap – if your cap was £50 or £100 – and a customer wins £25,000, and then within the next 24-48 hours starts losing it back, you nowadays have to go to the GC and prove the source of funds. Even though you’ve given them that money, you still have to prove, somehow demonstrate, that’s your money. 

When you reduce the stake cap, you reduce the max winnings and so your net balance is in a much healthier position than before, and your customers are having a better experience off the back of it. 

EGR: Underlying EBITDA is up 22% in the first half of this year. Do you anticipate an even stronger 2024? What is the focus for the remainder the year at Buzz Bingo? 

DM: This is the way you have to report on EBITDA. But actually on a pre-IFRS basis, which is how the industry likes to measure it, the numbers are even higher, significantly higher – more like 83% growth. And I think that’s how our performance is really trending, which is way better than what you’re seeing. That does put us in a decent position for the second half of the year.  

We’re really optimistic about the changes we made in 2023. We had a massive cost initiative to bring down the underlying cost base of the business, while trying to invest in doing things to make the business tick again. Those primarily were investing in infrastructure, so Wi-Fi in the clubs and the tablets that people play on, through to investing in prize and prize boards, and those things don’t just give you an instant uptick.  

We’re seeing that starting to filter through, which for the second half of the year we think puts us in a really good position to exit at a really healthy level.