Can tighter regulation drive innovation?

As lawmakers crack down on advertising practices around Europe, it seems businesses are heading for an even tighter squeeze on margins, but could creative thinking be key to turning challenges into opportunities?

Sometimes, in the most difficult of circumstances, people can come up with surprisingly resourceful solutions – and as regulators in mature markets look for new ways to tighten their grip on operators, the gambling industry is no exception. To be fair, these “solutions” don’t always work out – I’m thinking in particular of William Hill’s “click-t0-call” app that was designed in order to bypass Australian in-play betting regs a few years back. But in the days of increasingly tight controls on advertising, this particularly branch of the industry could be an exception.

This February, Spain became the latest in a series of European jurisdictions to take a strict line on advertising practices. In a long list of new rules that includes an effective advertising blackout for most of the day, the coalition government set its sights on what has become standard practice in the industry: offering free bets and other cash incentives to sign up, and pummelling viewers with demands to “bet now”.

At the same time, major bookies like William Hill, Ladbrokes and Coral have been initiating a rethink of their image and considering how advertising can impact public perception of an industry both positively and negatively. The trend away from the old beer-swilling, laddish brand image has been happening for a while now, but building brands around sports fan-culture, sociability, excitement – those intangible aspects of the betting experience – could be just as effective as any “free” bet with endless terms and conditions attached. This is an important realisation.

It’s a truism that consumers are increasingly sophisticated these days, and the era of marketing campaigns just consisting of telling someone to do something in a loud and hectoring voice are well and truly over. The fact that the public often cite “aggressive” marketing in polls and surveys as a driving factor in their negative perception of the industry should be a wake-up call for operators. It seems an end to this style of campaigning is, in part, what regulators are trying to bring about, and a handful of operators seem to be right there with them as they start doing things just a little bit differently.