Strength in numbers: Ladbrokes Coral talks multi-brand strategy

Two years ago this month Ladbrokes and Gala Coral sent shockwaves through the leisure sector with news of a mega-merger between the two UK heavyweights – and from the off both firms were keen to dispel any talk it would opt for a single brand approach. “We think the multi-brand strategy is the right strategy and it would seem Paddy Power Betfair would agree with us,” Gala Coral’s former boss, Carl Leaver, said at the time.

“There are examples of where operators have consolidated brands in the market and found it hard going, at least in the short term, so we are happy with our strategy – we think it’s a strategy that will add real value.”

From a marketing perspective, Ladbrokes Coral has also emphasised that while both brands may appeal to a similar type of customer, it did not necessarily follow that there were no points of differentiation between the two. And in a recent interview with EGR, CEO Jim Mullen claimed how this is to be achieved is currently an ongoing debate between both its marketing and trading teams.

Ladbrokes Coral’s recently installed director of marketing, Alexis Zamboglou, is one person with a critical role in this debate. EGR Marketing spoke to Zamboglou to find out more about the operator’s brand strategy and its marketing plans for the coming year.

Alexis Zamboglou, director of marketing at Ladbrokes Coral

EGR Marketing: Has the merger process been difficult for your teams?
Alexis Zamboglou (AZ): It’s no secret that on a human level, the merger process for any company can be challenging for the teams involved and can create uncertainty across the board no matter how transparent the integration process is. However, the marketing
teams here in Gibraltar, Tel Aviv and London understand that the scale delivered by the merged Ladbrokes Coral entity helps mitigate market changes and brings huge potential not only to investors but also to the overall employee base. We’re now working for one of
the biggest gaming companies in the world and with this comes great opportunities for our colleagues across the online and retail businesses.

Our senior leader team has done a fantastic job at being open, communicative and approachable throughout the integration process, which has allowed the teams across all locations to build confidence that the changes being implemented would not only benefit our company revenue but also their career prospects. At Ladbrokes Coral we’ve not only built a sustainable and robust business model to withstand all industry challenges but we’re also building a company culture which champions innovation and encourages leadership
at all levels.

EGR Marketing: How have you personally found the experience of being part of such an historic merger?
AZ: When I joined the industry in 2007 both Ladbrokes and Coral were cornerstone brands of betting in the UK. My ambition was always to be part of some element of marketing for these great brands, and 10 years later to get the chance to be such a pivotal part of this historic merger has been amazing. I couldn’t quite believe the news when the initial rumours of the merger surfaced. For so many years these renowned betting brands competed fervently with each other, so it seemed nothing more than M&A-related fever pitch that Blue and Red competitors would come together.

“The merger rumours seemed nothing more than M&A-related fever pitch that Blue and Red competitors would come together”

Having been part of the merger process, I now fully understand the rationale behind the move for consolidation, having witnessed the efficiency and scale that a multi-brand betting PLC can deliver. It’s an exciting prospect to be able to help shape the marketing strategy for two brands which are loved and cherished by the British betting public.

EGR Marketing: Was there anything about the Ladbrokes set-up that impressed you and have adopted across the enlarged business?
AZ: There were numerous cross-brand learnings which could be incorporated pretty fast from people, processes, business intelligence, technology and marketing strategy alignments. It’s an eye-opening experience to be able to consolidate all our learnings across sportsbook and gaming marketing to form a ‘best-in-class’ approach by using clinical fact-based assessments to define the strategy.

The important factor when two brands come together is to put aside legacy bias and attempt to view performance comparison as emotionally removed as possible. Fact-based assessments have been the key drivers to decision making when putting the Ladbrokes and Coral marketing strategies alongside each other. It’s not good enough to just carbon-copy one marketing strategy onto another, that’s just lazy marketing led by opinion based conjecture.

EGR Marketing: What do you think are the main opportunities for Ladbrokes Coral of pursuing a dual-brand strategy from a marketing perspective?
AZ: As is widely accepted today, the UK betting market in particular is an ultra-competitive environment with regular betting consumers holding four or five betting accounts, according to the latest market research. There’s no doubt that the pace of growth year-0n-year across online gaming is slowing down, yet there is no reduction in brands entering the market as each financial year passes. Adopting primary and secondary account status for our brands across the consumer’s share of wallet is the key objective of an efficient
dual brand marketing strategy.

Gala Coral and Ladbrokes completed the historic merger in November

A dual brand marketing strategy also gives us the efficiency to put our next pound of marketing investment in the brand or channel which drives the greatest incremental return in revenue. We have the cost efficiency of bulk media buying across two brands, reinforced by the campaign efficiency of continual optimisation according to revenue return.

EGR Marketing: The summer usually brings auctions for the main TV sports channels – has that been the case this year? If so, how competitive have they been?
AZ: Indeed it does. Despite the perception that there is a lull in sportsbook marketing because of the sports calendar in June and July, we’re busier than ever. Sports TV viewership has been a hotly debated topic this year with most evangelical marketers predicting a mass move away from traditional consumption of live sports on TV towards ever-emerging digital platforms. This shift has started, but isn’t as fast as many would have you believe, which means TV still holds a lot of power in the overall marketing mix, specifically in betting where live sports events and demand for betting products are so intrinsically linked.

TV advertising is no different than any other marketing channel, in the fact that it needs to justify its cost by what it delivers to the bottom line of the business. Like all our marketing channels, we view investment based on our projected return and have some pretty intricate methodologies to analyse this cause and effect. We want Ladbrokes and Coral to be at the forefront of bettors’ minds and TV investment is a big part of this. We have a strong sports TV share of voice and plan to continue to bring great offers and great ads that cut-through to sports fans across the UK.

EGR Marketing: What about talk of a crackdown on TV advertising for sportsbooks? Are you making any preparations in this regard?
AZ: It would be naive to assume that the changes to TV advertising in Australia won’t have an influence on legislation in the UK and other European territories in the medium term, so being prepared for a world without live sports betting advertising seems like a necessary safety precaution. Coupled with the potential decline in consumption of traditional sports TV as we know it suggests that seeking alternative routes to brand exposure is necessary.

At Ladbrokes Coral we consistently promote responsible gambling standards and ensure that the marketing of gambling is socially responsible across all our channels, especially TV. We carry Senet Group messaging throughout our marketing to ensure that we reinforce our commitment to gambling standards. We take social responsibility for our customers’ betting behaviour seriously, so it’s important the legislators are conscious of this concerted effort in the case that they consider a ban on TV advertising.

EGR Marketing: How much more competitive is obtaining lucrative sport sponsorships between bookmakers these days? What are you seeing in terms of costs?
AZ: The list of sports sponsorships available to betting operators is unending but it’s picking a route for your brand which is relevant to the key KPIs of your business that’s more important. The strategy of throwing investment at Premier League clubs to buy brand creditability, for example, is one which could come unstuck quite fast.

From a Coral viewpoint in the past, we’ve always been passionate about our sports sponsorship and see our portfolio of sponsorships as a unique opportunity to engage on an emotional level with loyal sports fans, not just pedal our promotions.

“Knowing your customer, your competition and your target audience is obviously the pivotal element of any marketing strategy”

In the last five years we’ve seen the cost and intensity of competition in the top tiers of English sports sponsorship rise significantly. The Premier League represents a significant opportunity for Asian betting brands given the exposure the average viewership of games across Asia has now reached. For this reason the market has seen growing price inflation across betting sponsorship deals specifically across low/medium sized EPL clubs.

More than ever, we are seeing jersey sponsorships from a range of Asian betting brands which makes it commercially difficult for a UK-facing brand to justify competing with. With the vast majority of Premier League media value absorbed from non-UK viewership, it
makes it difficult to build a business case for marketing investment of this type, if your brand aspirations aren’t focused on Asia and beyond.

EGR Marketing: Which digital marketing channels has Ladbrokes Coral really been focused on over the last few months?
AZ: Digital marketing has been a key area of success for both Ladbrokes and Coral in the last three years as competing brands and where we have become extremely strong as a combined entity. A key factor to the success of digital marketing is understanding, scrutinising and defining the performance of your sales/conversion funnel throughout each customer journey. This understanding supported by cutting-edge business intelligence and predictive analytics allows our brands to stitch together the fabric of a very complicated ROI driven landscape.

A departure from the last-click approach which is singular and stale in its methodology and over-credits channels like brand PPC and bottom of the funnel channels is important. The customer has more than one touch-point on their path to registration or bet placement, so it’s key to understand not just the importance of one digital marketing channel but how they work together as a network of advertising interactions.

“I see next year’s World Cup as providing another stepping stone for Ladbrokes Coral to move to the next level of our ambition”

EGR Marketing: Did you have any reservations about targeting a similar type of customer with two separate brands?
AZ: Knowing your customer, your competition and your target audience is obviously the pivotal element of any marketing strategy. Betting consumers break down into several types of cohorts which further disseminate into smaller components that make up our eventual target base. Across this range of different demographics, it’s obvious there will be overlaps by any two brands within the gaming sphere. The key priority of a dual brand strategy is to ensure that message and tone of our brands complement each other in both the nuances of the creative and the promotional execution.

It’s key to avoid customer base cannibalisation between the two brands which will erode market share but it’s a tactical skill which the teams are fast learning and becoming frighteningly good at already.

EGR Marketing: Any plans to launch a new big bang marketing campaign?
AZ: We’re working very hard behind the scenes on creating a roadmap which will deliver value to the consumer, not just across marketing but all facets of the business. The senior leaders across marketing, brand, trading and product have an insatiable desire to give our customers the best experience possible and deliver a first class innovative product to bettors across the UK.

It would be foolish to conceive a ‘big bang’ marketing campaign which shouts really loud but lacks the solid foundation for an excellent customer experience. That’s why we really want to mean what we say and support our core marketing messages with a robust infrastructure of the best products and promotions that deliver value to the customer.

EGR Marketing: Is it too early to start talking about the importance of World Cup 2018?
AZ: No, it’s never too early to start talking about the biggest tournament in world football. Consistently, the summer tournament represents a key growth opportunity for the betting industry, which is why we pay such meticulous detail to our preparation for events like this.

From a marketing perspective, our plans have already begun and we want Ladbrokes and Coral to both be at the heart beat of the home nations fans (and Ireland, as an Irish fan). Brazil 2014 proved to be a pivotal step-change for the Coral online business and I see next year’s World Cup as providing another stepping stone for Ladbrokes Coral to move to the next level of our ambition.

Football is at the heart of most recreational bettors and giving our brands the platform to shine during these pivotal six weeks will have a residual effect on the business in the six months following the tournament – so there’s a lot to play for next summer, both on and off the field.