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Gambling companies spend £1.2 billion marketing online, five times more than on television ads

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Gambling companies spend £1.2 billion marketing online, five times more than on television ads
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New financial analysis from respected gambling industry specialists Regulus Partners has estimated that the total spend by gambling companies on marketing has gone up by 56% since 2014, and has now hit £1.5bn.

Most marketing activity is now on the internet, with companies spending five times more online than on television.The new figures, derived from audited accounts of the top publicly listed operators and other available financial data for private and offshore companies, indicate the areas where gambling companies spent the most money on marketing in 2017:

• Direct online internet marketing costs – £747m, almost half (48%) of total gambling marketing spend

• Advertising through marketing ‘affiliates’ – websites, tipsters and publications who earn commission for generating new business for the gambling companies – £301m, nearly one fifth (19%) of total expenditure

• TV gambling advertising – £234m, just 15% of total gambling marketing spend

• Social media – £149m, more than tripling over three years, and 10% of total gambling marketing spend

• Sponsorship – £60m, double the amount spent in 2014 (£30m).

80% of all gambling marketing spend is now online. There has been significant debate about the amount of advertising by bookmakers, bingo websites and virtual casinos on television, but these figures shine a light onto the huge amount of money being spent promoting gambling on the internet. Detailed marketing expenditure is considered commercially confidential, so obtaining definitive figures is not possible. But Regulus Partners have applied similar techniques used by city analysts to generate estimates which will have strong credibility within the gambling industry, and clearly indicate the relative extent of online marketing activity.

Marc Etches, CEO of GambleAware said:

“Children are growing up in a very different world than their parents. The Gambling Commission reports that 59% of 11-16 year olds have seen gambling advertisements on social media, compared to 66% on television. One in eight 11 to 16 year olds follow gambling companies on social media, and they are three times more likely to spend money on gambling. Of those who have ever played online gambling-style games, 24% follow gambling companies online.Compared to other potentially harmful activities, the rate of gambling in the past week among young people is higher than the rates of drinking alcohol, smoking cigarettes and taking illegal drugs. This underlines the need to treat gambling as a public health issue.

The Regulus analysis shows that much more attention needs to be payed to the extent of gambling-related marketing online, and that internet companies and social media platforms must share in the responsibility to protect children, and to generally raise awareness of the nature of gambling, associated risks of harm, and where to go for help and advice if it is needed.”

An infographic summarising the financial analysis is here!

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Industry News

888 Announces Q3 2021 Trading Update

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888, one of the world’s leading online betting and gaming companies, has announced a trading update for the three months ended 30 September 2021 (Q3 2021). The Group’s Q3 2021 performance was in line with the Board’s expectations.

At the end of the Period and following policy changes published by the Dutch Gambling Authority (KSA), the Group took the decision to cease provision of services in the Netherlands from 1 October 2021. The Group continues to believe the Netherlands represents an attractive medium-term opportunity and intends to apply for a local licence in the coming months. Notwithstanding this unforeseen development within the Netherlands, the Board remains confident that the performance of the Group during the current year will be in line with its expectations.

Looking ahead, the timing of any licence award within the Netherlands remains unclear, but the Group aims to be operational within the country during the second half of 2022. This temporary closure is expected to negatively impact 2022 EBITDA, post certain mitigations at Group level, by approximately $10 million, with no change in the Group’s expectations for 2023 and beyond.

Itai Pazner, CEO of 888, said: “Q3 2021 was a period of outstanding strategic progress for 888. During the period we announced the transformational acquisition of William Hill International, successfully launched SI Sportsbook in the US, and began operating 888sport under a new licence in Germany as we continued to execute our plan to build a global online betting and gaming leader.

“Alongside these important strategic milestones, I am pleased with the Group’s continued positive trading, particularly as we lap very tough comparative periods. This performance reflects the continued success of our data-driven investments and execution against our product-leadership plan that delivers ongoing improvements in the usability, quality and safety of our sports betting and gaming products.

“Underpinned by our advanced technology, leading products, and strong brands, as well as the increased scale, talent and diversification that the Group will benefit from as a result of its combination with William Hill International, we have a very exciting platform for long-term growth.”

Business Review

Q3 2021 was a period of significant progress for 888. During the Period, the Group announced the transformational acquisition of William Hill International, which will significantly enhance the enlarged Group’s scale and create leading positions in several key regulated markets. In addition, the Group continued to deliver on its long-term growth strategy in the US market with the successful launch of SI Sportsbook in Colorado, utilising 888’s in-house sports betting platform for the first time in the US.

B2C

Gaming revenue growth of 11% was led by casino, reflecting the continuing success of the Group’s investment in enhancing the user experience through product and content leadership as well as AI-driven personalisation.

During the period, the Group launched more than 150 new casino games including several in-house developed games, which continue to resonate well with customers and provide a differentiated experience. Alongside expanding the range of content, the Group continues to improve the experience for customers using AI-driven recommendation engines and personalised offers, which it believes is leading to increased share of wallet, and therefore market share gains in several key regulated markets such as the UK, Italy, Spain and Romania.

Betting revenue declined 15% against Q3 2020 when the Group delivered a very strong performance that benefited from a condensed calendar of sporting events following Covid-related disruption, particularly within football across the Group’s UK and key European markets. Compared to Q3 2019, betting revenue increased 21%.

B2B

Revenue from 888’s B2B division increased 4% to $9.6 million, with both the bingo and US operational segments delivering moderate growth.

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Industry News

SYNOT Games Signs Distribution Deal with Playtech

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SYNOT Games has signed a new content distribution deal with Playtech, the world’s leading gambling technology company.

This deal is another important landmark in the SYNOT Games growth strategy, continuing to deliver gaming content into new, regulated markets.

This partnership will further enrich the existing Playtech offering of popular titles, including top performers such as Book of Secrets, Respin Joker, Mysterious Atlantis and newest releases Pixel Reels, Fruits Go Multiply, Diamondz and others. SYNOT Games slots will be available in both desktop and mobile resolutions.

The popularity of the 70 plus in-house produced SYNOT Games has risen rapidly among Europe’s largest online casino brands as well as retail slot halls and is now available to a broader player audience.

“This partnership shows our commitment to expanding our reach into new regulated markets across the globe and we are looking forward to a successful partnership,” Ivan Kodaj, CEO at SYNOT Games, said.

“We are delighted that SYNOT Games has joined the Playtech distribution network as its Casino software partner. Playtech’s scale and distribution is a powerful offering for potential partners, and this is a great example of our commitment to partnering with the right and well-known companies to bring great content to regulated and growing markets,” Tomasz Mogiła, Country Manager at Playtech, said.

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Industry News

Free Bets to be Banned in Ireland Under Landmark New Gambling Laws

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A proposal for new gambling laws in Ireland is calling for the banning of free bets in the country.

The newly proposed gambling legislation in Ireland also seeks to create a national gambling regulator in 2022. The regulator will be given powers to revoke or suspend gambling licences, and will be able to freeze accounts and block incoming payments to providers, while there will be no inducements or VIP treatment for certain gamblers.

A social impact fund meanwhile will also be established, which will place a levy on gambling companies, which will fund addiction treatment and other awareness measures. A self-exclusion register will be available to allow gamblers to restrict themselves from certain providers for a certain period of time.

Advertising is another area that will be subject to strict measures, with the new regulator able to issue codes around the time and frequency that gambling ads can appear on TV, radio and other media. Bans on ads which may appeal to children will also be put in place.

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