With domestic European football just underway and the realisation that Qatar 2022 will be here before we know it, Ebbe Groes, Group CEO at EveryMatrix, digs into the vital issue of sportsbook profitability.
Whether it is professional football, table tennis or FIFA, one aspect of a sports fan’s passion is always placed above all else.
It isn’t the skill of the participants, be it Cristiano Ronaldo smashing in a long-range free kick or a Russian ping-pong expert executing a killer topspin backhand. Nor is it the social, communal aspect of sport-watching (as important as that is).
What matters more than anything else in all sports is what truly sets it apart from our mundane, day-to-day existence: unpredictability.
The level of variance in predicting which participant will ultimately win varies from discipline to discipline. In certain sports, the better team on paper will be victorious more often than not, whereas in a less mature event like FIFA, what we generally term as “shock” results come around more frequently.
In every case, however, it is impossible to know with absolute certainty that one side will defeat the other. While this is at the heart of sport’s intrinsic appeal, for sportsbooks it means that whatever margins are employed as a buffer, there will always be highs and lows for operators and end users alike.
In financial reporting, the troughs for sportsbooks are referred to as “unfavourable results”, which is code for heavy favourites regularly coming out on top. In the case of the recent Euro 2020 tournament, this danger was averted.
In particular, the last-16 exit of Germany, France and Portugal brought joy to the hearts – and profit margins – of bookmakers around the world. In fact for us at EveryMatrix, we had more than 16% margin across all bets placed on Euro 2020, probably the best such tournament ever!
Thankfully for operators, profitability need not be entirely at the mercy of the vagaries of sporting results within the framework of a modern, adaptable sportsbook platform.
It remains true that traditional market types – single home-draw-away, goals or points markets and handicap bets – are favoured by most bettors. However, in a world where entertainment in sports betting is increasingly being pushed to the fore, it is no longer enough to rely on the tried-and-tested.
Sportsbooks are now competing for the attention of casual customers with streaming services and there is an increasing need to offer personalised betting opportunities on platforms that work seamlessly on mobiles and which – crucially – offer big-win potential.
In providing operators a platform that offers something for everyone, including the growing breed of customers who demand to be served with a huge range of markets, including bespoke propositions, there lies an opportunity to yield superior results in terms of turnover.
On the opening day of the Premier League season, for example, newly promoted Brentford hosted Arsenal. The visitors started as favourites and sportsbooks naturally priced them as such. Little did they know the Bees went on to record a famous 2-0 win. But guiding end users towards attractive, high-odds BetBuilder bets – or “same game parlays” – helps lock in extra profit.
The EveryMatrix BetBuilder technology allows customers using the OddsMatrix platform to create and place bespoke, high-odds bets. The opening day Brentford clash was the only match taking place in its time slot, which replicated the conditions across the Euros where same-game multiple options became hugely important for operators. Not least, because the margin on our same game multis is, on average, twice as high as it is for traditional single markets.
It is not without some amusement that I read announcements from big operators banging the drum about them adding this feature for the new season. We have had it live since May 2020, starting with football. We are now up to six sports and are constantly adding more. And as with all such innovation, it takes time to fine-tune the presentation and mathematics to get it right.
For all the new engagement methods in operation today, it is also important not to lose sight of the classics. The BonusEngine from EveryMatrix, for example, is a sophisticated bonusing system that can be configured to offer customers Odds Boost and Stake Back incentives, both of which can play a significant role in rewarding the placing of bigger multiple bets.
Sport cannot be second-guessed, but customer behaviour can be understood and used to create win-win scenarios for operator and bettor. The right sportsbook platform can equally engage, entertain and secure profit margin, enabling operators to concentrate on crucial brand-building and acquisition activities.
That is one result everyone can predictably be happy with, even in the gloriously unpredictable world of sports.