Genius Sports: Driving dynamic, automated liability-based odds adjustments at scale

Thomas Holland, Product Director at Genius Sports, talks about betbuilders, risk management, and how innovations are driving change in sportsbooks in an exclusive interview with SBC News.  

SBC: Managing liabilities has become complex, with products like betbuilder creating exposure across millions of outcomes. How do you effectively manage risk in today’s world?

Thomas Holland: Managing liabilities has always been complex, going right back to the days when traders would manually set odds on every market by taking into account the true price, weight of liabilities and which individual customers were driving those liabilities. 

The growth of 24/7 content and markets-types has made managing risk nearly impossible without automation. With exposure spread across millions of outcomes, many operators now opt for limit setting, delays and player profiling to cut losses, which leaves profits on the table and can disrupt the customer experience.

But thanks to new technology, bookmakers can finally drive dynamic, automated liability-based odds adjustments at the scale they need, for maximum profitability on every event and market, including on products like betbuilders which carry significant operator-specific liabilities.

SBC: What are the advantages of using automation in risk management? Are there any potential drawbacks?

TH:  The biggest upside of automation is greater efficiency and profitability with faster and more scalable trading. Since 2016, in-play event coverage has grown by 250%. Automation in risk management is key to keeping pace.

Betbuilders, as an example, spread liabilities into legs across seven, eight or nine-fold betslips. How do you monitor this, let alone manage it efficiently? Only with automation can operators balance liabilities and adjust pricing based on betting activity, match state, live probabilities and make trading parameter changes in a correlated and reliable way.

The downside you hear is that people feel automation means a one-size-fits-all approach. But we approach risk in a unique way for each individual operator, as we focus on their own bets and liabilities – with customisable templates, limits and overrounds settings to allow traders to distinguish their sportsbook.

SBC: What kind of changes are new innovations driving in sportsbook trading rooms?

TH: Historically oddsmaking was a highly-specialist manual skill. Traders would set the price, take each bet and focus on maximising profitability, but the role of the trader has since evolved. Sports betting is now a 24/7 online entertainment experience and traders must also consider customer acquisition and retention, brand differentiation and finding ways to grow turnover.

Automated products require trader supervision, with customer and industry data at their fingertips, but models are vital to today’s oddsmaking process. With true pricing now commoditised and commonly outsourced to third-parties, traders can focus more time on key risk tasks like customer factoring, profiling and adjusting templates.

SBC: How important is pricing that reflects interest in local teams and matches? How can multi-jurisdiction operators create truly localised offerings in each market? 

TH: This is an age-old debate and it begins with the true price. The probability of Manchester City beating Chelsea is the same in the UK as in New York but that doesn’t mean you have to offer exactly the same odds. Reacting quickly to your customer base is a key part of offering the right price.

This is an important detail for many reasons. For North American operators, liabilities are often condensed into a few NFL weekend outcomes. Multi-state, liability-based odds will unlock extra margins regardless of the result. The same goes for European operators across the weekend elite football coupon.

Meanwhile, pricing is now an increasingly powerful customer acquisition lever in mature markets like the UK, which is another reason why operators need the control to adjust and localise pricing.

SBC: How can new technology help operators offer more markets and maybe even unique markets?

TH: The richer, faster match state and player performance data that automated models now leverage is the building block for trading innovation. This combination will enable an even more immersive betting experience. 

Betbuilders and props have become standard across Europe and the U.S. – the next wave of growth will see operators explore deeper onsite content and market-types involving finer aspects of player performance that contextualise the live game narrative.

Personalisation of sports betting has been widely discussed and is fast becoming a reality with betbuilder products, deeper insight into customer betting history and new innovative streaming solutions such as BetVision that tie it all together.

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Thomas Holland, Product Director at Genius Sports