14 THE FUTURE OF SPORTSBETTING

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JULIAN ROGERS ASKS WHAT THE INDUSTRY HAS IN STORE AS WE MOVE INTO A NEW PHASE OF

SPORTS BETTING ! THE EVOLUTION OF MOBILE SPORTSBOOK ".#

When the humble mobile sportsbook debuted around the turn of the cen-tury, it was generally perceived as the ugly duckling digital sports betting o!ering. The nascent hardware was

mainly to blame for shackling its initial progress. These were the days of sluggish WAP handsets with fiddly controls and dinky monochrome displays, while the excruciatingly slow 2G connections only compounded the misery.

In 2014 a fully featured mobile app is now standard, but is technology already starting to make them look outdated? The revolutionary iPhone, which burst onto the scene in 2007, signalled a watershed moment for m-commerce – including the egaming industry. Various iterations of the iPhone, together with the arrival of a slew of Android smartphones, sparked an arms race among the operators for mobile sportsbook dominance. The explosion in mobile sports betting growth earlier this decade – in triple digits for many operators – was quite staggering. It’s a segment that shows little sign of slowing down. William Hill’s mobile sportsbook turnover surged by 78% in Q1 2014, accounting for 45% of total sportsbook bets.

But the question is, what is the next stage of the mobile sportsbook’s evolution? And how will the egaming industry react as consumers begin to migrate away from desktop for good? For OpenBet CEO Jeremy Thompson-Hill, mobile sportsbook 2.0 will ultimately boil down to creating the next level of UX for customers. “Clearly you don’t have the same space as desktop, but you want your product to be far-reaching without being crammed and confusing. And if you build mobile sports betting products that become clunky or complicated, it is easier to use their products on the web. Ease of use is going to be key going forward.”

Although sports betting is a fairly uncomplicated product, several operators have included new features to stand out in the market. One of the more ubiquitous additions is live streaming, which has only become a feasible proposition for mobile users in the past few years due to improved network coverage and inclusive data bundles. Paddy Power’s online sportsbook product manager, James Grimes, sees obvious benefits of live streaming on mobile devices but concedes that the technology isn’t quite there yet.

THE FUTURE OFSPORTS BETTING

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“To a degree, live streaming is still fi nding its feet on mobile and adjusting to some of the constraints of the technologies involved. [However] we’ve just done a major release to support presentation of streaming online on native devices so customers can watch the stream and see the latest live prices on the same page.”

More generally, Grimes says there have been “huge advances” in online live betting technology in recent years. “These advancements are slowly starting to creep into mobile as operators try to understand how they can best position all this highly engaging and informative live betting data and visual tools alongside their core betting proposition. I feel we’ll see enormous advancements here over the next 12 months from the market leaders.”

LIVE STREAMINGGrimes is also of the opinion that live streaming will continue to be a “key aspect” of driving in-running turnover on mobile. Indeed, live betting and the immediacy of mobile have made perfect bedfellows up until now. It’s a crucial revenue stream – live betting accounted for 45% of sports wagers played by Unibet in Q1 of this year. SBTech CEO Itai Zak says 75% of mobile sportbook turnover is derived from live betting across its 13,000 monthly in-play events.

“The better in-play product you have, the higher your turnover and revenues will be – the best in-play product provides the largest variety and coverage of live events and the widest markets and options to bet,” says Zak.

Live betting is usually the crux of the major operators’ marketing messages. It’s almost become the USP of mobile. We’ve all seen the disembodied head of TV tough guy Ray Winstone growling in his trademark cockney brogue at UK audiences to whip out their mobiles and “bet in play, now” with bet365. As well as streaming live footage and providing statistical data during matches, bet365’s mobile o! ering serves up rudimentary graphics to illustrate the in-play action

“TO A DEGREE, LIVE STREAMING IS STILL FINDING ITS FEET ON MOBILE AND ADJUSTING TO SOME OF THE CONSTRAINTS OF THE TECHNOLOGIES INVOLVED” ! JAMES GRIMES, PADDY POWER

Paddy Power’s online sportsbook manager James Grimes outlines the challenges ahead for mobile sportsbooks

CHALLENGES AHEAD

“The big consideration continues to be how we are gearing ourselves up for the challenge of producing suites of products across a range of platforms. We are seeing continued growth across our traditional mobile base of iPhone and Android on both native and web-based o! erings. Tablet growth is accelerating and we are seeing emerging platforms such as Windows starting to hit some headline grabbing numbers.

“That is a considerable amount of platform and product fragmentation, much of which has individual technology and skill-set requirements, and in addition we should expect more changes in this landscape over the next three to fi ve years. But the prize is big, so ensuring that we are structured internally and working with the right delivery partners to meet the opportunity head on across all fronts is critical to winning at mobile.”

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for a variety of sports. It’s better than staring at a soporific scoreboard if you can’t see the live action.

And putting pertinent statistical data and features at the fingertips of users can encourage them to keep the app open and place wagers. Andrew Daniels, managing director of Betfred.com’s mobile development arm, Degree 53, believes the level of live data is set to intensify. “The way things are going, I can see streaming of all sports and events becoming ubiquitous and a focus on a better integration of stats, scoreboards and social data to help punters feel more informed, which will ultimately drive them to make more bets.”

Although it’s a given that in-play will be at the heart of mobile sportsbook 2.0, Daniels also stresses that “personalisation and specificity” will be key to a smarter mobile sports betting product in the future. “Intelligent sportsbooks adapt to a user’s preferences, location and betting opportunities. Other e-commerce or m-commerce sectors have been doing it very well for years but I’ve yet to see a sports betting site that compares.”

He says the benchmark is online retail behemoth Amazon. “The way Amazon instantly learns what you like, not just by what you transact with but what you look at, then o!ers you related products and its CRM campaigns that are tailored to what you’ve been doing on the site is second to none. If someone can replicate that on a sports betting site they’re going to be two steps in front of the competition.”

On top of this, the geo-targeting of sports bettors at sports stadiums with communications via push notifications is predicted to be a growth area for the industry in the years ahead. It’s all part of a push to engage with customers on a one-to-one basis with specific o!ers that would pique the interest of the recipient. BetVictor’s head of sportsbook product, Eoin Ryan, also envisages a more “tailored” mobile sports betting service coming around the corner. “I think you will see operators really start to drill down on mobile user data in order to provide a very tailored and personalised service. This is already happening to a degree through segmented push messaging but there’s a huge amount happening in this area and there’s much more that can be done.

“It will undoubtedly improve customer retention, lower churn, as well as improve profitability over time. As we learn more about mobile customers and how they actually use our product, I think you will also see changes to our presentation and product interface so that we make placing a bet on our most popular markets, at any given time, a single-click experience,” Ryan says.

A CLEAN SLATETablets are another area of growth, a few operators have made concerted e!orts to target tablet owners, with products that exploit the roomier displays. Indeed, this segregation of phone and tablet – rather than lazily blowing up the sports betting product to fit the dimensions of the larger device – could very well be a future trend for mobile sportsbooks. Tablet is shaping up to be a key battleground for the operators. For instance, leading spread betting outfit Sporting Index has just launched a tablet-optimised site alongside separate smartphone and tablet apps released earlier this year.

Similarly, Paddy Power recently unveiled a comprehensive sportsbook app specifically for iPads. The native product took over a year to build in-house but, as Grimes points out, di!erentiation is a core philosophy of Paddy Power, “We don’t do ‘o! the shelf’,” he states emphatically. “A key objective was to deliver the most technologically and visually advanced tablet product on the market. Going native was the only way to do this, and we invested heavily in the user experience before a line of code was ever written.”

Paddy Power CEO Patrick Kennedy has described tablet as “central” to the Irish firm’s future growth. And with Gartner reporting that 195 million slates were sold last year, the opportunity to target users with unique sportsbook products that shine on tablets could reap dividends. These devices seldom leave the home and are predominantly connected to the web via Wi-Fi. “What users want to achieve, their habits and expectations, di!er greatly on mobile compared to tablet,” says Sporting Index’s web and mobile product manager, Gregory Karaolis. “In most cases, the desktop sites are not fit for purpose for various reasons including Flash, ‘hover-overs’, and various other features which are not touch friendly.”

Conversely, another tendency that could very well indicate the future of mobile sportsbooks is the emergence of stripped-down standalone apps complementing the main product. This is especially useful for the customers only interested in a specific market or those who tear their hair out navigating a maze of menu options to pinpoint the intended odds. For Betfred, its Goals Galore (both teams to score) coupon was so popular that Degree 53 segregated it from the main product and housed it in a dedicated app. “This approach has brought in a lot of new customers after the app went viral,” Daniels asserts.

There’s also been apps created of late to aid speed and convenience of bet placement, including the Paddy Power Messenger App – much akin to the WhatsApp app. The service allows customers to simply send a short text message to place a wager. Grimes explains: “Messaging apps are ubiquitous in the mobile space and consumers are well used to apps like WhatsApp and Viber, as well as the more established solutions from the likes of Facebook and Skype. So why not use best practice mobile behaviour from other industry successes at the core of a betting app? It was a natural evolution from our text betting product and has found appeal with that customer base.”

“WHAT USERS WANT TO ACHIEVE...DIFFERS GREATLY ON MOBILE COMPARED TO TABLET” ! GREGORY KARAOLIS, SPORTING INDEX

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Square and Sportingbet were devoured by Betfair and William Hill respectively. Yet the cutthroat environment hasn’t deterred News Corp. from preparing to launch ‘Sun Bets’ sportsbook, which follows the Guardian and Mirror newspapers throwing their hats into the sports betting ring. French poker operator Winamax is also plotting a sportsbook launch.

One recent entrant is start-up Tedbets, a peer-to-peer betting product that, unlike Betfair or Betdaq, allows players to wager with one another on just about anything by customising bets. “There is always room for innovation,” says co-founder Scott Burton, “and I think there are going to be new mobile products that are able to capture new and existing customers. There is an established user base that is not looking for something di! erent, but I think there is a group of current and emerging sports bettors that are not being serviced and that’s what we are attempting to address with our products.”

These new operators are aware they will need to fi ght tooth and nail to gain any edge they can over the established competition in the saturated mobile sportsbook space. But di! erentiation from rivals, even for the household names, is no easy task with mobile apps if their product is running on the same third-party platform of the competition. It’s an environment packed with ‘me-too’ o! erings. Also, the confi nes of a smartphone display somewhat hampers di! erentiation. Sure, the more price-sensitive or shrewd customer will tend to deviate towards the product with the standout odds on a particular market, but features such as mobile-specifi c concessions and price promotions can make all the di! erence with acquiring and retaining customers.

Several operators have included the de rigueur cash out function on mobile, while Betfair has also integrated its new

BetVictor, too, has produced a slimmed down app that uses push notifi cations to o! er mobile-exclusive price boosts on major events for a set period of time. Ryan says feedback from iOS and Android Instabet users has been “encouraging” and predicts that other operators will launch simplifi ed apps alongside their main sportsbook app. He adds: “Betting is complicated. We live and breathe it every day but we have to be very mindful that the vast majority of our potential customers do not.

“Years ago, some operators tried simplifying their products and websites for new visitors, which never really worked, to be honest.”

Likewise, Daniels is confi dent that multiple sports betting apps signal the way ahead for the industry. “I hear quite a lot of debate about whether or not there should be focus on one app that does everything or to have several, more focused apps. For me there’s no argument – there should be several apps. You only have to look outside of gambling at other big companies and you can see that they follow this. I’ve got fi ve apps for Sky and four from the BBC – each one focuses on what it’s good at.”

A CROWDED HOUSEWith the UK market chock-a-block with native and web sportsbook apps, you could argue that it’s too late, or game over, for new entrants. There’s the real possibility that we are at the stage where it’s become a closed market controlled by the usual suspects. The tough market conditions were highlighted with the recent demise of real-money social sports betting operator Bodugi. And last year egaming stalwarts Blue

THE SUPPLIER�’S VIEW

KRISTIAN NYLEN, CEO OF KAMBI SPORTS SOLUTIONS, ON THE FUTURE OF MOBILE SPORTS BETTING

eGR: What will be the critical elements of mobile sportsbook 2.0?KN: Since mobile usage often tends to be more ‘on the go’ and spontaneous, bets with quicker settlement will be more popular over time. The design and UX should facilitate this type of usage. Of course, this is especially vital for live betting and I’m sure we’ll see some innovative new bet types that cater to live betting in a mobile world. Also, mobile apps provide the possibility to communicate with

the customer at any moment. If used in a good way, by providing valuable information at the right time, there is a huge potential to activate the customer to a much larger extent. Mobile apps will increasingly be the primary source to access the sportsbook, such as a second screen when viewing an event live or on TV, and the application must be able to meet those demands.

eGR: How important is a ‘mobile fi rst’ mindset?

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Price Rush feature into its mobile sportsbook. Price Rush leverages liquidity on the operator’s betting exchange to enhance odds on selected sportsbook events, enabling Betfair to beat rivals on price. This sort of in-house innovation could prove crucial. In fact, industry observers expect more mobile sportsbook products and features to be developed in-house in the near future, as opposed to farming projects out to third-party developers who will take their cut.

“Doing the development in-house makes it easier to get out a unique product,” says Mark Davies, co-founder of Betfair

and now managing director of communications company Camberton. “In Betfair’s case, things like Cash Out and Price Rush gives you a reputation for innovation…that’s why businesses like William Hill, Ladbrokes and Paddy Power are spending money developing teams in-house.”

Thompson-Hill also foresees more operators developing in-house in order to gain an upper hand. “Operators will do more and more to manage and own their products, which means it will get harder for third parties with sports betting products to get traction. With mobile versus the web it’s 50-50 or 60-40 in some areas, so who would give away a front-end revenue share on their website? No one. They [in-house developers] are not betrothed to innovation being something that everyone gets; they can innovate themselves and be their own shop window.”

Either way, Grimes suggests that mobile products are reaching a critical stage of drawing level pegging with the desktop channel, which could ignite new possibilities. “We’re also coming to the point for most operators where functionally their mobile proposition is as mature as their online o! ering,” he says. “This may trigger a change in focus with far more investment subsequently made in the overall user experience, simplifi cation of presentation, di! erentiated user journeys, and so on – we have an awful lot we can learn from non-industry best practice here.”

So does that mean operators are fi nally choosing not to treat mobile as addendum to desktop and instead adopting a ‘mobile fi rst’ approach? Christian Rajter, ex-CEO and co-founder of Swedish mobile sportsbook developer Mobenga, is unequivocal with this response to this question. “No, no, no and no – you can quote me that I said ‘no’ about 16 times. It’s easy to talk about going mobile fi rst, but you just have to consider how much time and money these organisations have put into desktop.” He slows his speech to emphasise his salient point: “It’s a paradigm shift to mobile but you have to follow the consumer.” One thing’s for sure: it’s going to be fascinating to see how operators and mobile developers improve sports betting products across mobile, tablets and perhaps wearables in the coming years. Let the battle for supremacy in the next phase of mobile sports betting commence and may the best sportsbook win.

“OPERATORS WILL DO MORE AND MORE TO MANAGE AND OWN THEIR PRODUCTS, WHICH MEANS IT WILL GET HARDER FOR THIRD PARTIES” ! JEREMY THOMPSON!HILL, OPENBET

KN: It’s absolutely vital to think ‘mobile fi rst’ at this point in time. Not only is there a need to provide a great experience for mobile users, but the lessons learned on those devices in terms of simplicity and clarity often carry well over to a desktop experience as well.

eGR: How can mobile sportsbooks stand out from the competition?KN: We’re looking into some rather innovative bet types that are likely to

attract a lot of users. Of course, for any high-profi le event a lot of sites will o! er such a large selection that on fi rst impression it is likely to look very similar to customers. However, much of the di! erence will be the quality of what’s on o! er – are bets suspended often, how long is countdown used for, how quickly are bets settled, and are there few errors in settlements? If you are lacking in these areas, users will notice the di! erence.

A NUMBERS GAME

Unibet streamed 5,819 live sports events to mobile devices in Q1 2014

A study last year by Onavo found that 4.3% of iPhone owners have installed at least one sports betting app.

Ladbrokes expects 25% of World Cup bets this summer to be placed on mobile

!,"#$ 4.3% %!&