4. Paddy Power Betfair (2018)
Financials: Q3 online revenues climbed 15% to £248m, buoyed by a 26% rise in gaming revenues and an 11% rise in sports revenues
Strategy & impact: PPB, which is among those calling for more restrictions on advertising, harnesses its two distinct brands to target a wide range of customers
Geographic reach: Company has two of the largest brands in the UK, a market-leading presence in Australia, and a growing foothold in the US and Italy
Influence & leadership: Paddy Power is still the standard-bearer for guerrilla marketing in the industry, while the Betfair Exchange still leads the exchange segment
A lot can change in a year. The 2017 entry for Paddy Power Betfair (PPB) focused on stagnating revenues amid the thankless task of a major platform integration, with CEO Breon Corcoran joking: “If we’d have known how difficult it was going to be, we’d have put it off for even longer.” One year on, Corcoran is leading a FinTech company, Paddy Power has returned to growth, and PPB is fighting for market share in the US betting market via its shiny new DFS brand, FanDuel.
Indeed, although PPB has slipped down one spot in the Power 50 rankings, the future looks a lot brighter than it did a year ago, starting with the US. It is the second largest betting brand in New Jersey and has secured access to a multitude of other states, while proving that sports betting is not cannibalising its $100m+ in annual DFS revenues.
Elsewhere, PPB reported a 15% rise in Q3 online revenues to £248m, buoyed by a 26% rise in gaming revenues and an 11% rise in sports revenues, in a period when several other major operators struggled. The gaming uplift, in particular, will please Group CEO Peter Jackson after the vertical frustrated his predecessor for so long.
However, it has not all been plain sailing for the London-listed giant. In October it was hit with a £2.2m penalty package after a Gambling Commission investigation found it had failed to prevent “significant amounts of stolen money” being gambled via the exchange. The firm said it had made “considerable learnings from the case” and invested in improving its AML and responsible gambling processes.
The other trouble spot continued to be the Betfair Exchange, which continued several stagnant quarters, including 1% growth for Q3 despite benefiting from the latter half of the World Cup, and a soft comparative period in 2017 where revenues were down 5%. Management pointed to continued fierce competition for racing customers from the likes of bet365 which uses the sport almost as an acquisition and retention tool rather than a revenue generator. Instead, the firm will look to international markets to help return its flagship product to former glory.