Some of the leading suppliers to the sports betting industry offered their insights into the future for sportsbook personalisation based on automated customer segmentation, advanced behavioural analysis and predictive AI-driven models.
The next round table participant was Betradar, represented by its Managing Director for Managed Trading Services, Paolo Personeni.
SBC: What role does pricing and risk have to play in the differentiation of a sportsbook offering?
PP: Both are certainly very relevant. Our operator clients need to be able to deliver a truly differentiated experience for their customers. There is a lot of debate surrounding how this can be achieved and if relatively small differences do count in the eyes of the player. To this, there are a few points that should be kept in mind:
- Pricing needs to stand out: Operators need to have an offering that demonstrates differentiation – the best way to achieve this is through pricing. Operators should focus on demonstrating their point of difference when it comes to pricing so customers perceive it to be the best offering in the market
- Customer service matters: Consumers in most western countries across the business world are now accustomed to exceptional levels of services. Sometimes their purchasing decisions can be swayed by marginal differences in this area so operators should keep this in mind across their entire offering
- Audience segmentation counts: Sportbooks in general generate a high proportion of their revenues (60%-80%) from a minority of players (20%-40%). As such, content options and prices that suit various audiences, including the high spenders, is fundamental
- Think local: operators need to keep in mind that certain geographical markets are culturally more price sensitive
The above points mostly relate to price differentiation; however, risk management also plays a crucial role in being able to offer a bespoke offering. Some sportsbooks, for example, leverage the ability to accept late bets as a way to attract more players.
Having a service provider that has the capability to accommodate a risk management objective is absolutely key. The key components to managing risk for a successful sportsbook are:
- Platform capabilities – adopting different limits for different player segments, by sport
- Real-time player segmentation capabilities using algorithms
- Having a 365-view of the player, including their other gaming verticals
- A continuous interaction between the operator and the service provider to optimise player-risk settings
SBC: How can operators build on their customer analytics to both enhance player experience and drive higher margins?
PP: It is all in the combination of marketing, risk management and trading. It should start from the assessment of the player’s expected LTV (life time value), which is something not every bookmaker can easily estimate initially. This should be followed with an early risk segmentation that is continuously updated over time, with flexible credit limits that are tailored to the player.
Then it is about modelling the player life time status (active, dormant, churning, reactivated, defecting etc.), coupled with personalised promotions. The final component builds on personalisation with effective trading strategies aimed at re-balancing the book, where possible, and improving profitability via targeted price changes depending on liabilities.
SBC: How can AI and analytics be used to personalise and tailor the sports betting experience?
PP: All of the above steps are impossible to perform without a robust analytical framework that is achieved, as much as possible, in real-time. It is also important that not only are the algorithms are individually optimised, but also their interaction is properly modelled, monitored and geared at generating the desired betting experience.
At the foundation of any good sports trading is technology, using machine learning and AI to analyse and utilise a large amount of data fast. The use of expert traders in addition to this is what helps make meaning out of the data, generating additional markets, for example, which can be used to both enhance a betting offering through increased markets and to tailor or personalise the experience based on a player’s betting activity.
SBC: A lot has been said recently about gamification, what can it do for sportsbook?
PP: In this technological age, to ensure you achieve engagement you need to go a step further in adding extra content that allows customers to get a better experience from a sportsbook.
Live, in-play and online betting all add extra opportunities. Streaming operates in a similar way, giving customers the ability to watch sports live and therefore generating extra incentive to stay on site and bet as the game plays out.
Gamification can replicate this effect, providing customers with additional options to stay on a sportsbook and be entertained. This is something we offer as part of our Betting Stimulation tools which, like all of our betting and trading services, is backed by our comprehensive data.
As part of this, operators can add everything from streaming to live match trackers, widgets and other statistical content. Our Virtual Sports products can also be used by clients as another way to boost their offering and add additional games, outside of real sports, to enhance their offering even further.
Both our Betting Stimulation and Virtual Sports tools can all integrated as part of our Managed Trading Services (MTS) in as flexible way as a client needs, allowing them to gain our 360-degree betting offering, including market-leading odds, trading and risk management, all under the one umbrella.