We sat down with Malte Hegeler, Head of Product Development at OddsMatrix – the sportsbook platform for EveryMatrix. He explained how he sees the development of sports betting and the technology behind it in a future shaped by accelerated digitalisation.
SBC: It’s been more than a year since the pandemic took the world by surprise, changing so many things including sports betting. What changes would you say are here to stay?
MH: One of the things I talked a lot about during last year was esports. And there were two reasons for that: traditional sports basically got cancelled, so we had to find an alternative; then, generations are changing, so the younger ones are likely to seek other forms of sports betting entertainment.
Esports entered the scene before the pandemic, but it was seriously boosted by it. From a side-project, it turned into a centrepiece for our sportsbook platform, getting to 50,000 monthly live events across 22 disciplines.
Now, with traditional sports mostly back on track, we can say our predictions were confirmed. Even with real-life sports coming back, esports get seven times more revenue than pre-COVID.
On the one hand, Sport Simulations convert fans of real sports to a higher extent, helping the short-term recovery of turnover lost because of the cancellation of real events.
On the other hand, my bet also goes on pure esports, such as CS: GO. These will steadily gain turnover because their incredibly strong fan base is maturing, and their revenues are increasing. That’s why we keep on growing the disciplines, with Valorant as our latest addition.
There’s also the interesting niche of virtual esports brought by Unikrn. They’re an additional esports segment, with fighting games like UFC, Streetfighter or Mortal Kombat, with a first-time virtual approach. This means they appeal to those looking for quicker betting, targeting different groups than traditional esports and sports simulations.
SBC: Talking about where things are going – in terms of target markets, are there any hot spots on the map these days?
MH: Answering from the perspective of a software provider that acts mostly on the European market, I’d say there are two very different, but equally rewarding markets to expand into: the US and Latin America (LatAm).
The first one, namely the US, comes with a very different betting culture. While it’s not a new market, I believe it’s probably on the radar of every ambitious sportsbook provider or operator, as there’s still a lot of room for growth in the US, even if it’s quite different from the European market in terms of content and behaviour. For instance, players don’t use multiple bets so much, and they focus more on tier-1 competitions for local sports like basketball, baseball and football.
LatAm, meanwhile, is a different story. While legislation is far from harmonised across the continent, the market is very similar to the European one. The differences are more in terms of punters’ behaviour, with higher rates for pre-live bets, a stronger presence in retail and reduced penetration rate of mobile betting.
SBC: Is OddsMatrix looking to expand in any of these markets?
MH: Yes, we are looking into both.
The US, for one, is a very exciting market for us. We’ve already applied for the New Jersey licence and we plan to expand even further there. This has given us the opportunity to strengthen our product in some key areas, such as building a dedicated front-end to match the punters’ preferences and, my favourite, strengthening our local coverage.
The sports disciplines people bet on are quite different in the US, so we’re currently under the process of adding a lot of localised markets, especially player props. And we’re also evaluating third-party providers to see if integrating some would be beneficial for our product.
For LatAm, we have a different approach – one of the particularities of that market is that retail has a very strong foothold. It so happens that for quite some time we have been developing a product that caters to retail operators, which will be a massive addition to our portfolio. Things are rounding up nicely in that direction, and this will enable us to offer omnichannel solutions for the region.
SBC: Investing in a retail sports betting software could seem like a curious choice now, when retail suffers most from the pandemic. Do you have any thoughts about the future of retail?
MH: Actually, we very much believe in the future of retail, but with a twist – we strongly think that it’s all about seamlessly uniting the offline with the online. Specifically, one without the other could be missing on a lot of business opportunities.
The retail component brings clear benefits. The social aspect, for once. In Germany, the betting shops have a very cosy set up, where punters come and sit for hours, watching the events together.
Especially since some retail outlets are more willing to spend money on broadcasting rights. Then there’s the marketing aspect – the venues are generally located in high-traffic areas, which means that there’s a lot of brand awareness to be gained.
The online, on the other side, proved to be an extraordinary safety net, especially in the last year. And some punters might stick to it because it’s so convenient – just one screen away from them.
We see a lot of potential in uniting the two wherever possible and creating a seamless brand experience from online to offline.
SBC: Going back to the online sportsbooks, as a platform provider, what do you think the focus should be?
MH: Platform providers have to focus on both the player and the operator experience, as they need to attend to both when building features into their products. You need to support player engagement on the one side, while ensuring operator flexibility. And I can give some clear examples on how we approached this in the past year.
For the players, we are constantly focusing on bringing new attractive features that really bring up the entertaining part in sports betting. Take our recent endeavours with BetBuilder, for example. It features five sports disciplines, soon to be six, and we don’t plan to stop there.
And I think the BetBuilder will prove especially engaging during Euro 2020, or for the basketball playoffs, when there are fewer simultaneous events. Exciting multiple bets are not so easy to place during those times, but BetBuilder is a great way of solving that and tuning entertainment backup.
Another feature that makes a sportsbook more attractive to players thanks to extra flexibility, at no extra cost for the operator, is something as simple as Auto Cash-out or Partial Cash-out.
Or maybe you can go for classics like Odds Boost and Stake Back – we’re very close to delivering them via the BonusEngine bonusing system – that rely on incentivisation, rewarding the player for placing bigger multiple bets.
For the operators, we’re heavily investing on ensuring they have the flexibility to differentiate their brand. When several operators use the same B2B provider, their sportsbook might start to look and act a bit too similar. That’s why we’ve integrated features that give them the opportunity to stand out. For example, the DIY option lets them create their own tournaments, events or markets.
SBC: And one final question – when it comes to gaining the loyalty of your punters, what do you think will matter the most in the future?
MH: My bet goes on customisation here, either this happens at operator or at player level. For example, the operator can choose to promote specific markets or events on the front-end for the player, based on the business insights they have and on what brings more value to their business.
Or customisation can also be automated and controlled by player data – for instance, betting recommendations that are based on the individual history or patterns of each player.
This is especially helpful in a world flooded with sports events, where choices become hard to make and players get too distracted. Narrowing down their options might actually improve the experience.