2020 will see some interesting developments in the gambling sector. The opening up of the United States to sports betting will cause deep-seated changes for marketing teams. As a result, there will be major shifts in resources and budgets between regulated markets.
2020 will also see a further split in marketing objectives for regulated and grey markets. This means that costs for certain advertising channels will soar in regulated markets as they will be growth driven. However, grey markets will be mostly profit-driven which will cap ad/affiliate costs to some degree.
Further consolidation of affiliates will also homogenise the channel and further reduce affiliate opportunities and profitable niche sites that sharp affiliate managers could take advantage of.
Marketing Trends for Betting 2020
- In regulated markets, growth and shareholder value will drive Advertising KPIs. Companies will sacrifice profit for user growth and expansion of their customer database in the US. In many cases, CPA will exceed CLV but the increase in company valuation will satisfy investors. This makes cracking the US very capital intensive. Google will have a bonanza.
- The great UK rollback – For years the UK was the hub of regulated online gambling. However, like death by 1,000 cuts incremental regulation has resulted in a difficult market to operate in. There are simply too many companies right now. As a result, the UK will be de-prioritised by many operators in 2020. It will take as much as a 60% reduction in the number of operators to render the sector attractive again. CPAs are way out of whack for all but the top companies who have a great product, brand and user retention system.
- Africa is a major opportunity in 2020. Smart industry players will ramp up their plans for Africa in 2020. A football (soccer) savvy market with a preference for lottery and jackpot games makes a good player base to develop your betting operation. More and more affiliates are launching African facing sites. Also, mobile is king here, so the more improvements to mobile UX operators make the better their growth in Africa will be.
- Asian performance networks will get more competitive and prices to obtain customers will increase.
- The XFL will lead be a testing ground for integrating betting and sports broadcasting. It remains to be seen how US broadcaster/betting operator joint ventures perform.
- The will be zero product innovation in 2020 – Look I have stopped believing the hype.
- Esports will have a stand out year from a betting perspective. More ATL spend from operators will go into sponsorships.
Marketing Trends for Betting 2020: What You Should Do
UK Gambling Market 2020
Ok, there is zero scope for aggressive growth but you can still acquire players profitability. However, you need to spend less on ads and more on ad strategy. The buzz term here is quality over quantity across affiliates and PPC.
I can tell you most betting sites do not have their PPC set up correctly. As a result, they are losing vast sums of their budget in the UK market. By tightening spend through proper tracking and analysis, ROAS can be dramatically increased.
I keep saying it, an experienced Affiliate manager is invaluable to a betting site. There is not another channel that experience pays off in like affiliates. Given the competitive nature of the sector, only an experienced affiliate manager will be able to build a successful affiliate strategy for the UK in 2020. Mistakes will be costly.
US Gambling Market 2020
In 2020 the US gambling market will be focused on growth. Acquiring as many customers as possible is key. As a result, CPAs will be astronomical on PPC due to competitive bidding and campaigns being managed to increase shareholder value and not ROAS.
Affiliates will be the same. Expect to see CPA deals circa $200 for sports and $400 for Casino with rev share on top. Also, expect to see Casino CPAs/Bounties being paid for cross-sold traffic (sports to casino).
The opportunity is in SEO. However, this involves a three-pronged approach 1) Technical SEO 2) Content and 3) Brand Awareness. Most operators will take a “Silicon Valley” start-up approach to growth and rely on paid ads. Their largest expense will be advertising with more than 50% of their total expenses advertising related.
Because of the long term nature of SEO, it will not facilitate these growth targets. Therefore, savvy SEO and brand building via content is a great longer-term play. Those who make the move now will gain massively long term.
The good thing is that paid search and SEO are not mutually exclusive. Do both, PPC will deliver rapid growth and SEO will sure up revenues on the backend.
Regulated versus Grey (Unregulated) Markets
In summary, the core trend here with the exception of the UK (where we expect an overall withdrawal is):
- Regulated markets will be concerned with growth at the expense of return on ad spend. Its a race to the moon. Driving shareholder value through user growth and not profitability will be the objective of the marketing department.
- Grey markets will still be focused on CPA and ROAS. Operators cannot be monetized on public markets. Company valuations will reflect this. As a result, the core profitability of business activities is key.
Marketing Trends 2020 for Betting – Conclusion
Lets us know your thoughts on your marketing approach in the gambling sector for 2020. Drop us a line for a chat.