Industry predictions for 2023: Social betting coming to the fore and data wars rage on

Tom Waterhouse, CIO, Waterhouse VC

Social betting

We see social betting coming to the fore. It is a product that is enjoyed by bettors and there is a strong business case for operators to spend marketing budget to promote it. By bringing together social media and wagering, bookmakers hope to improve customer retention and lifetime value, and thereby cut down on their marketing costs as time goes on.

In May 2021, Australian operator, Sportsbet, launched their social betting product, ‘Bet With Mates’, which allows bettors to pool their bets into one group and invite friends to share in the bet. Ladbrokes Australia followed suit with ‘Mates Mode’, while there are some operators, such as Dabble, which are completely focused on social betting. In just a few months, Dabble’s impact has been seismic and when they move into US., we see their community-focused USP as being important. If you look at the trends in wagering apps in Australia during 2022, social betting apps have increased from 0% market share of wagering app downloads to 10% in just over a year.

Influencer marketing

In recent years, we have seen a huge shift in the consumer paradigm towards creator-guided commerce. Creators provide brands with a new distribution point for sales. Influencers are seen as more credible and authentic than traditional marketing, thanks to highly personalised audiences and a unique ability to describe product experiences and journeys in a way that is raw and human. Today’s audiences want to connect with like-minded people rather than celebrities. Consumers are more likely to make a purchase from someone who they feel they know, whose tastes and interests align with theirs.

Obviously, this relies on market regulations allowing for such influencer interaction. In the UK, regulators have increasingly put barriers in place to disallow social media influencers from creating betting content, but this is not the case in Australia and the United States. In the US, Jake Paul’s Betr has had an instant impact, while Barstool Sportsbook’s success has been leveraged off the fame of Barstool’s founder, Dave Portnoy. Barstool has built its brand on authentic personalities and unique content – Portnoy regularly posts his betslip, often with a link allowing the viewer to copy automatically through their Barstool Sportsbook account.

Fixed odds in US racing

The US only has short sports’ seasons – 20 weeks for NFL; 80 games in NBA. There are then big blocks of the year where these sports are off. That is fine if you can convert customers into igaming, but that’s unlikely to be approved across many states, with such strong land-based casino interests. Basically, racing is a filler product, which could take the place of igaming. Horseracing is on from early in the morning to late at night. If you look at the UK and Australia, horseracing is a large part of the sportsbook mix. Racing doesn’t need to become anyone’s first thought – that might still be NFL or NBA, but racing becomes part of the ecosystem of the products that sports fans bet on.

However, in order for this to happen, racing needs to be packaged up as fixed odds, which new online sports betting customers understand and are used to, rather than parimutuel. In fixed-odds betting, for example, if you are placing a bet on a Lakers versus Knicks basketball game, you know what you are going to receive at certain odds, but with racing’s current parimutuel system, a bettor could place a wager at 4-1 but a day later it actually starts at evens. With fixed odds, horseracing can develop as a US filler product in a similar fashion to the UK or Australia. New Jersey is already experimenting with fixed-odds betting for racing.

Jonathan Power, MD, Voxbet

Voice betting and navigation for sportsbooks

2022 was the year when the number of things you can bet on outnumbered the total number of websites that there were in the world when Google launched its challenge to Yahoo. 2023 will be the year that ushers in another irreversible trend, whereby we will see operators begin to offer common navigation techniques which allow their customers to get their bets on in the same the way they get to do everything else online – by typing or speaking what they want.

What happens after that is harder to predict with specificity, though, since the digital real-estate freed up by offering Speak-Type-Bet navigation can and will be filled in many different ways. Ultimately, your sportsbook experience will become as different to mine as our Spotify and Amazon homepages are. Personalisation has been a buzzword in the industry for too long. But this year will be the time it begins to arrive with consequential force and progressive utility. Soon, a bet-mic will be expected on every single sportsbook.

Existential threats and data wars

While the US will remain a huge opportunity for many, including ourselves at Voxbet, its highly-fragmented space means no-one’s leadership standing should be taken for granted long-term – certainly five or 10 years down the line. The next 12 months will only see more tense skirmishes, particularly between the big four of five operators, as contenders and challengers jockey for market position.

Similarly, the data wars will rage on to new battlefields. Just take the escalating costs around official data where, for example, specialist odds providers have previously been able to piggyback off operator deals with the likes of Sportradar and Genius. Not for much longer. Will their profits be gouged, can they lock in a lower rate, or even consider an “open-source” workaround for the scouting networks of yore? And that’s before we even get to the existential threats of regulation, whether you’re in an evolving landscape like the US, or a mature one like the UK. An increasingly challenging regulatory market will draw more established operators to emerging markets as a source of growth – where sensitivity to data costs make messaging platforms for betting especially important.

Uptick in BetBuilder and multiples (including in-play)

In-game multiples, or multi-legs, will continue to grow in popularity. And voice can take the BetBuilder and request-a-bet model to another level of convenience. Operators can price almost anything in real-time, but there is a limit to what can be displayed in a menu of options. Allowing customers to speak their BetBuilder can enable infinite options.

The difficult-to-reach younger generation, with which all sportsbooks want to connect, will expect interfaces they already use everywhere else. Any sportsbook will have to meet this cohort where they already reside, as they won’t invest in an interface they regard as inconvenient.