In order to maximise the lifetime value of newly acquired customers, investment in content should be of increasing importance to betting operators, writes Stanislav Mykhailov - Head of B2B Department at BetInvest

BetInvest: Taking a content-driven approach to sports betting

In order to maximise the lifetime value of newly acquired customers, investment in content should be of increasing importance to betting operators, writes Stanislav Mykhailov – Head of B2B Department at BetInvest Ltd – who stressed that a greater emphasis should be placed on content-driven betting experiences as opposed to just client capture.

As is the case for streaming platforms, food delivery services and sports betting operators, 2020 will go down as a year of aggressive user acquisition.

Continuing to show rapid growth, the online sports betting market may currently be described as one of great income potential yet minimal product differentiation. The global online gambling market is expected to reach a CAGR of 11% between 2021 and 2025. 

By that time, 75% of global sports betting revenues are expected to be generated by bets placed online. The market for online sports betting is predicted to be worth $102.97 billion by 2025 and its long-term potential is valued at $158 billion. As we can see, this is showing no signs of slowing down.

Like betting companies in 2020, the prevailing strategy of well-funded businesses across all of these industries is simple: win over a wider audience. Investing heavily to gain market share while the market is still developing and customers are forming habits was seen as the way to become the preferred user destination in coming years. 

In certain regions, the advertising costs of sports betting brands grew by 82% YoY in 2020. The keystone of these promotional tactics was to maximise the size of the client funnel by maximising reach.

The lion’s share of 2020’s sports betting ad budget went to TV broadcasters, whose main benefit is scaled reach. Major TV networks, as well as pro sports teams, were eager to negotiate lucrative partnership deals with those willing to pay a tidy sum for contracts like this.

We believe that in 2021 this strategy of chasing broad reach and user acquisition at all costs must be reassessed.

Despite increasing sales and marketing costs, in Q3 of 2020 we saw industry high rollers losing millions of dollars. This is evidence of growing competitive constraints. The aggressive “top-of-funnel” marketing approach doesn’t appear to be sustainable, even for the industry’s leaders, and in the current environment challenger brands are unlikely to ever outperform large companies. 

Resources need to be redirected from user acquisition towards lifetime value. Betinvest believes that sports betting operators should concentrate on boosting content and growing communities within their platforms if they want to make the cut.

Sponsorship contracts, massive ad buys, and promotional agreements all help to increase brand awareness in target markets. These actions may bring in new users, but they don’t translate to customer retention. Basically, it’s a strategy that is broad and thin at the same time. The client’s loyalty to the promotional partner never fully shifts to the sportsbook. 

If a Dream Team fan sees an operator’s branding all over the stadium and finds out there’s a promotion for a risk-free bet on tonight’s game, he may sign up for them. But then what? He came in as part of a community, but once inside he is just another user. 

Therefore, in an extremely commodified market like sports betting, it’s not enough to just acquire customers. Online sportsbooks must also engage, amuse, and retain them. Сontent and community aren’t only ways of attracting users to an app, they are also key to keeping them there.

At Betinvest, we wanted to help our clients fill their free airtime with unique, action-packed, frequent, and reliable sports betting content. For that reason, Betinvest has entered into contracts for exclusive broadcasting and trading distribution rights with fast-growing professional esports and Quick Sports leagues: Cyber Live Arena, Esport Pro Club and Winners Leagues. 

All our partners have a jam-packed match schedule catered to any location, as well as a variety of the world’s most popular disciplines made fully tradable by Betinvest. Driven by skilled, highly ranked players, these leagues already have strong communities of sports enthusiasts around them – and our content solution is guaranteed to entertain bettors. 

Contextual live scores, stats, and insight keep customers on site, allowing them to follow the progress of their bets and to make fast betting decisions. All this helps to increase time on site, the daily number of active users and customer loyalty.

All things considered, sports betting operators need to start functioning more like media companies. Not only will a content-driven strategy significantly reduce user acquisition costs, it will also dramatically improve customer lifetime value.

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