Grow a sports betting company online in 2021. We have many interests in the Betting & Gaming industry, and we continue to advise Sports betting companies on implementing strategy. With that in mind, we decided to share a short blog.
GROW A SPORTS BETTING COMPANY ONLINE IN 2021
Please note, what you read below is based on our professional opinion. If you have questions regarding this blog, feel free to write us at firstname.lastname@example.org.
THE EARLY DAYS OF ONLINE SPORTS-BETTING
Online Sports betting began in the late 1990s, In the beginning, punters might have been sceptical, but it didn’t take long to gain traction.
At the time, the biggest obstacle was payment methods. Bank transfers took too long to process, and cash wasn’t an option. Companies such as Skrill, and Neteller introduced e-wallets, and the rest is history.
To legalise a business, the only requirement was a betting license. US-facing business set up in the Caribbean, and for Europeans, it was Malta and Gibraltar.
The other issue was regulators, especially in EU states Germany, Sweden, Italy, Belgium, and Cyprus. They would attempt to block Sports betting companies, but the courts usually ruled (free trade) against the State.
One method used for processing bets was the agency (franchise) model. Local partners would set up betting shops and transfer the bets. For online companies, betting affiliate programs became the standard. Both modules worked on revenue share with business booming!
It took relatively little money to grow a betting company quickly!
CURRENT STATE OF PLAY – GROW A SPORTS BETTING COMPANY ONLINE IN 2021
Customers have become demanding by wanting more betting content. For the operator, that means an increased cost.
For the purpose of taxation, countries introduced their own licensing regimes. Needing multiple licenses and having a local set-up adds to operational costs. As a result, small and medium enterprises (SME’s) are struggling to compete.
Generally speaking, big operators have the global market cornered. Take Bet365 for example who employ around 5000 people and who in 2019 had £767 Million in revenue. To gain their position at the head of the global market, they successfully implemented;
First-moment advantage – With less competition, it was easier at the beginning. The Stoke-on-Trent based company implemented a clever strategy and created a recognised brand.
Massive Content – Content is king, and Bet365 offer bets on anything and everything. All the verticals are in place, and they have become a supermarket for betting.
Reputation – Bet365 are a trusted sports betting company. They are one of a few operators who actually honour partner agreements and do things right. In addition, they have an excellent reputation with online gamblers.
Website layout – Modern-day betting is all about user experience. In other words, the website is designed for simplicity and leaves a good impression.
Top-end software – Everything works as it should. Therefore, punters trust the platform and the process.
Multiple betting licenses – Legal and local! Having the legal right to offer bets makes this company trustable.
High payout limits – In an industry that encourages dreamers to dream. Bet365 have an industry high £2 million maximum payouts on top-level football.
High-performance marketing – Develop a marketing strategy that embraces rich content! The Bet365 marketing team created a brand of trust, it makes promoting easier!
Multiple currencies – Giving customers a chance to bet in a chosen or local currency. Localisation encourages people to open betting accounts.
Language support – Not everyone is comfortable speaking English. Support is offered in multiple languages.
Payment methods – Offering multiple E-wallets and other payment options is a must for international business.
Live streaming – Bet on it and watch it for free. It creates customer loyalty, and keeps leisure players on the website.
Fair odds – If we compare to other leisure facing operators, Bet365 offers its customers a fair value product.
Bet365 claim to have over 53 million customers. This company earns a seal of trust from business partners and customers alike!
IT TAKES MONEY TO GROW – GROW A SPORTS BETTING COMPANY ONLINE IN 2021
Many of the betting companies you know today were founded with little initial investment. We can name many startups which began with as little as 100-250K, and today they are worth billions! However, at some stage, every business needs investment to scale. Bet365, Betsson, Tipico, Unibet, Bwin and Bet-at-home used institutional money to make it to the next level!
Typically, investors look for;
Proof-of-concept; Product-market fit! Does the business attract new customers, and then retain them!
Positive cash flow; Investment is for scaling and not survival. If a business is self-sufficient, with help it can scale!
Software Architecture; Ongoing software development means staying ahead of the game. Full-stack with customer approval and resources is a must.
Company Structuring; Business structures need to be optimised. They must be crystal clean, tax-efficient and ready for growth.
Brand of trust; Reputation is everything! Licenses & clever marketing create a positive image. It doesn’t take long to figure out the company reputation.
WEBSITES NEED A TOP LANDING PAGE – GROW A SPORTS BETTING COMPANY ONLINE IN 2021
A website landing page needs to convince and then convert visitors into becoming clients. A positive first impression is essential. Considering costs involved with promoting websites, getting the unique selling point in front of the customers is the main factor! Make the incentive instantly clear, whether it be;
Aesthetically pleasing – First impressions. Don’t underestimate layout or colours.
Bonus Promotions – If the enticement is a bonus, hit the visitor with the offer.
Fantastic odds – Win more, best odds, great value – Sell it!
Betting content – Sport types
In-play betting – More popular than ever before, and it keeps customers on the bookmakers website.
Other games – Verticals are a great way to boost income. By that we mean casino, and any other games.
A Sports-betting website should be SEO friendly and represent what clients want to see. Find out what is attracting (USP) first-time visitors, and market accordingly.
A good company profile encourages rather than deters, work on it!
UNIQUE SELLING POINT
It takes all sorts. The appeal of betting companies is dependent on finding the right balance. For example;
Professional gamblers are more interested in low juice Asian odds. Bookmakers bet to lower margins, and winning accounts are acceptable.
Leisure bookmakers entice customers with a first-time deposit bonus and higher payout limits. They don’t want wise guys or professional gamblers. When someone wins big, it should be luck rather than skill. Leisure operators offer masses of content, including all the verticals.
Bookmakers need to focus on what they have at hand. What appeals to an African customer wouldn’t work in Asia, and vice versa. Localising business is the quickest route to finding clients!
OPPORTUNITIES FOR GROWTH– GROW AN ONLINE SPORTS BETTING COMPANY IN 2021
We are often approached by Betting software companies asking if we can help them find customers. Most offer turnkey solutions, such as White labels, Sportsbook service, and casino hubs. Unfortunately, the market is competitive, and we wouldn’t be the right partner.
To grow a Betting and Gaming company, the best opportunities centre around;
Localisation – Brand product/services locally. As a minimum, put representatives on the ground who understand need and are capable of networking. Localisation creates a brand of trust, which in turn gives consumers and business partners confidence.
High-end marketing – Assuming a company has the right product and cash, they have the ammunition to expedite growth. The most successful company at marketing is Bet365 because they literally have a presence on every gaming site. Even in this blog, they have a post link, and they pay for it. Other than that, Bet365 has built a strong network of affiliates. Sites host forced pop-ups on their behalf, and they are across all the social media channels and sponsorships.
Blockchain – While it is a double-edged bet, many offshore companies are long accepting Bitcoin. Cryptocurrencies are now in the public domain. This payment method is perfect for deregulation and those looking to bet without legal constraints.
Niche status – Some companies have done well out of focusing on a specific type of betting. Take Racebets and Pferdewetten.de who concentrate on horse racing. To show value, back in 2016, Racebets sold out to Betsson for €40 million. The German facing Pferdewetten.de is capitalised at €80.76M. Game suppliers, virtual sport, and e-gaming specialists are all niche!
Value – Punters love Pinnacle because they offer great value odds with high betting limits and don’t ban winners. Betfair was the first betting exchange with real liquidity. It was a game-changer that hardly needed promoting. Punters will find high-value services, and that’s why the low margin Russian bookmakers are making a splash.
CONTENT IS KING
With leisure consumers, content is king! Did you know, most sports betting companies purchase data from 3rd-party services such as Bet-Radar? This leading supplier offers fixtures, odds, and results into the system. Without such services, a Leisure facing SME would not be able to compete.
The problem with using this method is everyone is doing the same. Many of the better-known companies are paying Betradar €200k+ per month.
Other incentives are needed to entice customers. Cash-out is popular, while accumulator bonus could be the carrot.
Having live streaming of sporting events will keep customers on-site. Stats, blogs, live-score are positive add-ons.
Online chat makes a customer feel secure. Deposits will often depend on trust, and the big websites create a better image.
MAKE THE BUSINESS FEEL LOCAL – GROW A SPORTS BETTING COMPANY ONLINE IN 2021
Website translations should be perfect, and not google-translate. Customers are more inclined to deposit with betting sites that explain terms & conditions well.
Having support staff to answer questions in the language of the customer adds trust!
A local betting license is a stamp of approval and it gives customers an added layer of protection.
Marketing a Betting & Gaming company will not be easy, albeit a massive budget will change that.
In the past, betting operators would work with affiliate sites for a share of the revenue. It was a fair method and was lucrative for both parties. Unfortunately, operators such as Sky bet and William Hill got greedy and walked away from commitments. Suffice to say, most top affiliates no longer accept unknowns!
Finding the right audience is a challenge, and most digital marketers do not have a clue. With that said, where there is a will, there is a way. To get the most out of your marketing, think product-market fit.
For long term success, great SEO (search engine optimisation) will save operators a fortune. However, it takes time, and other ways need exploring.
Marketing depends on many factors. Take into consideration target territory, legality, and what you have in hand.
EXPLORE OPPORTUNITY – GROW A SPORTS BETTING COMPANY ONLINE IN 2021
Many of the latecomers to the European market went to Africa. While the Government licensing system is somewhat corrupt, it is relatively easy to obtain the necessary rights.
Well established companies are more focused on getting into the US market. It will be interesting to see which companies are successful. Canada is also starting to license sports betting, and so are many countries in South America.
In the betting and gaming industry, the legal situation is continually changing!
Some gaming companies offer skins. Partners receive a full suite of product in return for a share of the profit. The advantages are cheap entry-level, license and content included. For those with a small audience, it is an option.
An example of such:
Israeli owned 10bet has all these skins, and possibly more : 377bet, baymavi, betfinal, betfirst, betfoot, bethard, betive, betolay, betrally, betsat, betstars, betvision, comeon, fun88, ganabet, jbet, jenningsbet, jojobet, justinbet, knockout, luckia.es, matrixbet, mobilbet, netbet, norgesspil, odeonbet, ole777, paradisewin, propawin, realdealbet (closed after ripping-off clients), redbet, redzonesports, royrichie, rubet, sekabet, setanta, spilleautomater, suomivegas, superbetin, sverigekronan, tlcbet, winmasters.
PAYMENT PROVIDERS – GROW A SPORTS BETTING COMPANY ONLINE IN 2021
What payment providers a sports-betting company can offer will be dictated by the situation. Determining factors include legal structure, target market, and license.
For those setting up offshore in places such as Curacao, it is not easy to get bank accounts or payment providers. However, setting up a legal EU entity (sister company) will make it easier to be accepted. The other option is to use a cryptocurrency like Bitcoin. US residents can fund betting accounts using this method, and it opens another world.
An EU licensed company should have every option possible. Even Paypal have stepped back into the arena, while maestro, Switch, Visa and Master card are cheaper to process.
One thing is certain, having options will improve potential.
REPUTATION – DO NOT UNDERESTIMATE
We have seen a rise in Russian owned gaming companies, and billionaire investors are behind companies such as 1Xbet. This relatively new enterprise gained traction by accepting gamblers from anywhere in the world.
Having everything in place makes it easier for customers to both deposit and receive funds. 1xbet offer all the e-wallets possible, plus the customer support is in many languages. A generous FTD bonus and attractive odds lure customers. And, to keep visitors on the site and betting, a vast amount of live-streaming with in-play odds is on offer.
However, 1xbet don’t have any worthwhile betting licenses. They fail badly in the reputation department, and they abuse client data.
We should emphasise, build trust through reputation management. By doing things right, the message will get out that the sportsbook pays, and viral marketing (word of mouth) works!
Anything is possible for companies that are well funded and ready to do things right. However, those that don’t understand money is needed to grow a company will struggle. Be realistic and evaluate what you have at hand.
Check out this blog on: HOW TO INVEST IN SPORTS BETTING – RISK EXPLAINED