You might have noticed new bookmakers & small betting operators have a similar look, and that is because they are buying-in odds and data from the same service. Buying ad space might get eyeballs to a website, but if the product is the same, it will not work!
TASTES LIKE CAT FOOD
Most bookmakers are like cat food, in that they have a familiar taste. With all due respect, why would anyone bet with an unknown bookmaker? The only chance a newbie has is if they found a new market, or are extra competitive.
NOT ALL BOOKMAKERS CREATED EQUAL
Who said size does not matter? in online-betting it does! Betting companies such as Bet365 have cornered the market. The Stoke-on-Trent outfit has the best software, a quality product, and licenses throughout the world. If you stop and think about it, around a dozen online-bookmakers have the market cornered. These enterprises have superior betting platforms and are more trusted than the rest put together.
New bookmakers & small operators will struggle if they fail to adapt!
BETRADAR EFFECT – NEW BOOKMAKERS & SMALL OPERATORS
Under normal circumstances, small betting operators can’t openly compete with better-known brands. Obvious reasons include marketing budget, not having human resources or high-end technology. Where new enterprises can compete is through content, bonus incentives, and attractive betting odds. Content delivery services can help balance the playing field.
The best-known provider of such services is a company called Betradar. Bookmakers pay anything from 10 to 200K per month for a full betting service which consists of; event pairings, results, adjustable odds, user stats, in-play betting, and warnings. Bookmakers can integrate software through plug-ins, and the Betradar system does the rest.
The Betradar system allows contracting partners to configure, sports they wish to offer, betting-key (%), betting-types, and set parameters.
It is also possible for bookmakers to take control by overriding imported odds. However, that option is not a natural process for less informed bookmakers, and that is why you see many companies offering the same odds.
MARKETING OPTIONS LIMITED
There are some excellent marketing people out there, but not many understand the betting industry. On top of that, top marketers come at a high cost and are used to working with big budgets. Traditionally speaking betting operators pay low salaries, and that is almost certainly the case with lesser-known companies. On top of that, betting companies are not easy to promote, and are often limited by regional licensing.
One of the issues facing gaming operators is restrictions on advertising. For example, unless these companies have a country license, Google will not accept AdWord campaigns. For the record, when they allow bookmakers to use their service, the cost of PPC (pay-per-click) is between $30 – $60 without conversion guarantee.
Most smaller operators believe the best method is through Affiliate programs. However, getting webmasters to trust them is not easy because bookmakers have a habit of reneging on agreements. Did you know because of this many super affiliates have seen their business crumble overnight!
Some bookmakers will allow affiliates to use black hat methods such as e-mailing lists or getting people to spam from social media accounts. The lifespan of such is limited, and these operators are usually heading towards a bad reputation. We also know of gaming operators who have had their license withdrawn or fined for such skulduggery.
The best options for smaller operators are often hybrid deals tied in with CPA agreements. Getting a banner on appropriate sites is great for SEO, but at the same time expensive. With that in mind, bookmakers using this method better have a great product.
Incentivising new customers through a first-time deposit bonus can work. However, gaming authorities have the duty of care, and they now restrict bookmakers from encouraging people to bet. Furthermore, those bookmakers who use such methods are often at the end of bonus abuse. And, it is especially the case since Matched-betting sites came along.
SHOP / NICHE – LOCATION PLAY
If you have found a new country which will licence betting, it is often a licence to print money. Over the last five years, Africa and South America as become increasingly popular for gaming startups. However, like with any business, if it is going good others will copy.
The longevity of betting companies will depend on the founders having a plan, and on top of that, they will need a bit of luck. The likes of Tipico (German facing) were in the right place at the right time. The startup capital for Tipico was less than €250K, on being acquired they where valued at over €1.2 billion.
Companies who failed to capitalise on the first-moment advantage include William Hill. The British high street bookmaker lost fortunes trying to get into the Italian & Spanish market, and they left with a massive loss!
If legally allowed what works is bricks and mortar, franchise partners. Getting others to do the dirty work and pick up the costs is a great way to drive any business forwards. With proper branding, newbies can get noticed quickly. The challenge is finding countries in which the market is open to such.
OUR ADVICE TO NEW BOOKMAKERS / SMALL OPERATORS
New entrants need to put themselves out there. Making the locals believe business belongs is ultra important. If a company is not in a position to localise, it needs to find a regional partner. Betting is all about trust and reputation. Start with a physical presence.
Online bookmakers need all payment options possible. Getting a reputation for being a reliable and quick payer will create a brand of trust. Any modern-day bookmaker needs all the verticals and sticky content to keep customers happy.
Last but not least, gaming operators need to think their website is a business card. People want easy functions and attractive outlay. SEO will come from user experience and learning how to keep people on site.
In conclusion, costs and regulations have increased. It is not going to get any easier for newbies to make a breakthrough. Nevertheless, do things right, and anything is possible.