Bringing sportsbook freedom to the forefront

Features

Max Meltzer, CCO, Kambi.

There is little sense in denying the influence that changes and fluctuations in regulation have had on the sports betting industry over the last few years. Markets have been regulating – and re-regulating, at a consistently steady pace across the last decade, and this unstoppable wave has presented operators and suppliers with plenty of challenges and opportunities.

The last year has been no different, with new and existing markets bringing in shifts and changes across Europe. Indeed, there are few active in the sports betting industry who will be looking for another reminder of the potential the ongoing progress of state-by-state regulation in the US presents.

Of course regulation, and the myriad of compliance requirements than come with that, has brought about a concerted series of challenges for operators. Illustrating this, Italy’s blanket ban on advertising has elicited a re-assessment for the country’s operators in how to appeal to and retain players, with the curtain recently coming down on sports sponsorships and in-stadia advertising.

Examples like Italy, and the new regulatory environment in Sweden, are emblematic of the fact that it is not just new markets where regulation is having a deeply felt impact. Compliance requirements are also becoming more complex in existing jurisdictions, highlighting the technological flexibility required to meet changes in the regulatory environment with complete assurance.

Indeed, although sharp movements in regulatory goalposts can present challenges to operators. they offer fresh opportunities for companies with the scalability to make the most of them.

Prioritising tech flexibility.

A sportsbook capable of rapidly adapting to meet new regulatory dynamics is crucial for operators aiming to seize the opportunities that the pace of regulation and shifts in jurisdictional approaches place in their path. Simply put, flexible, robust technology is a must.

No operator wants to be left in a position where they are either unable to enter a new market or need to withdraw their services due changes in market conditions they cannot reconcile.

Recent examples, such as the Swedish regulator’s decision to prohibit betting on events featuring a majority of U18 participants have gone a long way to underline the challenges facing sports betting providers when it comes to compliance.

However, for operators investing in trusted B2B providers, markets regulating should never be seen as a blockage. Building a sportsbook on the firm foundations of strong, flexible underlying technology, agile trading teams and software, alongside powerful reporting and compliance tooling remains the ideal means of navigating the opportunities that new and tightening regulations present. 

At Kambi, we pride ourselves on providing the foundation our partners can count on to succeed in regulated markets. Many of our customers have taken advantage of the scalability our technology offers to enter multiple new markets, all with differing regulatory requirements. Further, our customers have been able to do this at speed, underlined by our recent market firsts in New Jersey and Pennsylvania, as well as New York, cutting the ribbon on the sportsbook at Rivers Casino and Resort Schenectady with Rush Street Interactive.

Driving meaningful differentiation.

Indeed, there is a need for flexibility with a view to more than just compliance. Crafting a betting offer distinct from its competitors has long been one of the industry’s principal challenges.

In a game of fine margins, sportsbook technology which can provide operators with the freedom to differentiate across both front and back-end will increasingly be central to a successful operator’s acquisition and retention efforts. Indeed, a high quality and flexible sportsbook, which can be tailored to the player, is one of the most powerful customer retention tools.

For instance, a sportsbook which allows for swiftly and easily configurable bonusing campaigns provides operators with an unmistakeable leg up on the competition. This is especially true in markets where regulation prevents multimedia advertising, or more direct techniques such as retention bonusing, with the need for a wider toolbox of odds enhancements and profit boosts growing in importance.

In addition, Kambi partners have the freedom to undertake complete control of the frontend to ensure their sportsbook is differentiated and aligned to their particular brand. Our sportsbook partners can build their own client on top of our APIs, create individual competition lobbies and control the navigation. This allows them to seamlessly direct and cater for players with specific interests – for example, by creating a specific in-client lobby around the beginning of the new NBA season.

It’s not just on the frontend where our partners can differentiate. Kambi operates a unique layer of pricing functionality within our sportsbook architecture, giving them the freedom to move prices and manage margin, effectively controlling how competitiveness of the pricing strategy from region to region and league to league. This, wrapped with our ability to deliver bespoke risk management, give our partners the flexibility to execute on their own individual strategies.

Differentiation, and the ability to enact it while offering consistently compliant and meaningful sports betting experiences is an ever-more significant factor in bookmaker’s ability to get its message heard, both in terms of attracting players and driving revenues. Investing in a sportsbook partner that offers regulatory peace of mind, technological flexibility and freedom is a significant step on the path to long-term growth.

Grasping the nettle in the US.

The extent of the differentiation which Kambi is able to offer, delivered alongside a proactive and swift approach to compliance, has been central to the progress we have made in the US to date, having recently struck a landmark agreement with Penn National Gaming, North America’s largest regional gaming operator.

When a sports betting operator chooses Kambi, they get a lot more than a few different colours and widgets to help them stand out – window dressing which we know is no longer fit for purpose in an industry that is only becoming more competitive.

Penn National recognised this, and our agreement with them stretches across both online and on-property, providing an omni-channel experience for their customers while also supporting the operator’s dedicated loyalty program. Driving retention is a big part of the proposition we offer to operators, and through Kambi our partners have the freedom to grow, innovate and realise their sportsbook ambitions.

What our agreement with Penn National and ongoing market movements in the US are highlighting is that, in general terms, two routes to a sportsbook offering are taking shape for casino stakeholders in the country. These are to either license their sports betting permit to an existing B2C sports betting brand, or partnering with a B2B sports betting provider.

The principal benefit of the former is that it can provide casinos with a quick means of getting up and running, with the established B2C sportsbook operator able to install the technology and get to work  on the marketing of the sportsbook. However, with the sportsbook operator’s brand to be placed above the door and plastered over the walls in this scenario, this brand could stand to gain more traction with patrons than the casino’s own. Would an established sports betting brand find more favour with locals, or, as the likes of Penn National decided, would it be best for the casino operator to leverage the strength of its own brand?

What investing in a trusted B2B provider can bring is the level of control and flexibility required to add a far greater level intrinsic value to the casino. Rather than surrender its database and creative control to a third party, casino operators can leverage the pre-existing trust and loyalty they have with their players to deliver new and engaging sports betting experiences under their own steam.

RECOMMENDED