Effective and Compliant Competition: More Players, not More Pay
Published January 20, 2021 by Lee R
Addiction does not need to be encouraged to increase revenues.
It doesn't take a gambling expert to know that addiction is the leading problem for the industry—and it doesn't take a genius to know that people who do not gamble quietly tend to stigmatize it as addictive.
Global Gambling Age
With a global population of 7.8 billion Statista reports from 2020 that 74% of the world is over 16, an age which an individually can reasonably be assumed achieve the ability to access gambling play, online or off, including at unlicensed sites with no age limits.
74% pf 7.8 billion is roughly 6 billion, meaning that some 4 billion people of adult age choose not to gamble. The remainder comprises a huge market.
Percentage of Global Gamblers
Last October of 2020, UK Footie confirmed that some 1.6 billion people gamble throughout the year, and 2 billion of the entire world population gambled at some point in their lives. A 1.6 billion-2 billion market is nothing to sneeze at, so the operators are going to compete for those dollars as vehemently as they are permitted to.
The Operator-Regulator Flashpoint
As the iGaming industry expands online casino and sports betting options, a tug-of-war has emerged between zealous operators and regulatory agencies who try to rein in the aggressive marketing competition amongst operators.
Fraction of Gamblers Addicted
Of the target market operators are vying for, only a small percentage of those players actually display signs of problem gambling, which plays out in the form of statistics such as one UK operator last year taking 83% if its deposits from 2% of its customers.
Targeting Overplay to Overpay
The concern for regulators as indicated by the Guardian article from which this data was provided to launch 2020 is that the gambling industry is relying too heavily on revenues from addicted players—in a country where punting is considered a national past-time.
Crackdowns to Protect the Vulnerable
Increasingly stringent measures which we have seen introduced by regulatory authorities both within the UK and without include hard curbs on advertising displays and limits on hours in which gambling adverts may be broadcast on television or radio.
Key Play Limits
However, the most controversial measure imposed by leading jurisdictions such as the UK to protect players is the wager limits.
Dueling Priorities
Operators and their trade groups are of course invariably tending towards flooring the gas when it comes to collecting revenues—with wager limits placing ceilings on how much an individual customer can contribute to the traditionally surging coffers of gambling operators.
The Wager Limit as Solution
At this point, in light of stigmas from outsiders and highly publicized problem gambling issues visible to stakeholders, wagering limits to protect gamblers appear the most effective means of maintaining a cohesive standard of credibility for iGaming as it continues to expand and regulate worldwide.
Focus Shift for 2021
While operators may quibble with getting “cut off” from willing spenders, they may just need to realign their focus to sustain or increase their revenue goals while adhering to player protection guidelines.
Establishing the Ability to "walk away"
When players are aware in advance of their play limits, the credibility of iGaming can be maintained or even enhanced by promoting more responsible decisions about iGaming, and more strategic thinking by players going in—with those limits based on limits percentage of income levels.
Wider Marketing not Harder
Operators should focus more on “horizontal” forms of expansion, and adapt marketing to wider audiences with less aggressive messages and less aggressive forms of marketing. The world has proven it can play without getting addicted. If operators do not overmarket or overrely on those who display signs of problem gambling, gambling as an activity and an industry can become safer, more respected, and more accepted.
Targeting the “Right” Players
When the recreational benefits are delivered in an increasingly safe fashion, the full social benefits of regulating iGaming be realized. Adapted marketing by compliant operators can not only help but reach more players who are able manage their own compulsive behavior better.
Avoiding the Vulnerable Few
Operators can become more complaint by easing off the targeting of players in the population minorities who possess the clinical characteristics that cause problem gambling in the first place.
Aggressive marketing antagonizes the vulnerable individual by seeking to clean him out, and this is the practice that UK regulators and others are concerned about,
Leisure not Risk
To expand safely, and respect guidelines, operators need to return to the core principles of gambling as a recreational activity. Risking money is supposed to be sporting, not damning. It's light recreation, meant for relaxation, not maximum risk stimulation.
Note to Operators
In 2021's regulatory environment discouraging over-reliance on big spenders and high rollers too much: take $1000 from 10 people instead of 1 to increase revenues.
Focus on the recreational component of play to offset the addictive component.
Transforming Perceptions to Maximize Revenues
When the world perceives of safe practice that protect players and do not conjure up the stigma of addiction, then iGaming will have the best chance of expanding, and operators will have the best chance of tapping new markets—which is the ultimate form of revenue growth.
Outlook
Effective wager and play limits are the best way to empower new and veteran players alike to manage their play proactively. The marketing practice of targeting less compulsive demographics supports operators and regulators to focus more on social reinvestment of the increasing revenues to be gained from safely expanding markets.
