Euro 2020 is finally going ahead this summer. It’s been a while coming and I – like all sports fans and bettors – am excited to get involved in the action of a fully-fledged major soccer tournament once again, writes Marco Blume (pictured), Trading Director of Pinnacle and the operator’s B2B arm Pinnacle Solution.
Russia 2018 is now becoming a distant memory, but Euro 2020 is coming quick. With some normality resuming to our lives, and escapism to be had through a month of first-class sporting action, it’s a period of huge potential for sportsbooks around the world with appeal going far beyond Europe’s boundaries.
Having lost out last year, it’s crucial that global operators reclaim those revenue streams this time around. This summer is a massive opportunity to do just that. The question remains though, whether sportsbooks are in a position to achieve their full potential and maximise this opportunity.
Fundamental trading practices being lost
Mega-events see operators nowadays lean towards acquisition goals, hoping that the added custom will pay out over a prolonged period, well beyond the final. It might work for some sportsbooks, some of the time, but there’s a better way of guaranteeing success at Euro 2020 and beyond, and that’s simply ensuring your trading teams and models are more efficient in managing risk.
High-revenue events can often justify the practice of following market-average pricing. Sticking out in the market is reckless in the face of huge action, no matter your risk position, and surely with so many opinions, the average price is right anyway? Not quite.
This trend towards the middle ground has gained pace in recent years, and the fundamentals of bookmaking seem to be becoming increasingly niche. Whether it’s strategic or due to a lack of skill is unknown, but average pricing will only ever lead to average results – if you’re lucky – and coming off the back of a challenging 2020, sportsbooks should look well beyond luck.
Instead, we should be looking at achieving the full potential from your sportsbook audience and the liabilities they’re bringing in. Maximising this potential and turning it into greater revenue and enhanced hold requires different risk management and trading practices; practices that focus on individual risk positions, not on your competitor’s mean prices.
Euro 2020 is set to be a prime test case for these different trading approaches, and we’re putting our stake firmly in the ground for our proven strategy – one that’s been tested, successfully, over decades on minor and major sports alike, facing our own bettors and via B2B partnerships.
Market-average pricing serves a purpose if your book is in line with the market expectations, but that rarely happens in practice. In reality, following the middle road will only suit the market as a collective, not individual operator needs. Pricing should account for each sportsbook’s risk portfolio; it sounds so obvious but it seems to be a dying art, and one that I’d like to see return this summer and beyond.
Every bet taken during the Euros affects your risk position, whether noticeably or just by a few Euros. However small the impact, the best trading teams will be adapting to this change of circumstance with a proportionate change in price. This won’t mean you’ll be offering flipped odds – instead, you’ll be offering prices relative to your position, and which significantly, might put you in a better spot to engage action from customers turned off by the same old prices elsewhere.
Manage risk, not unknowns
The start of this year’s soccer season was unprecedented. More goals, higher penalty counts, and freak results became commonplace. As trading teams, we adapted models and priced this up as best we could, but we can’t predict the future, however hard we try. This is another reason to put trust in your player base as a source of knowledge. We have thousands of sports experts ready to let us know their opinion, and we should harness this to overcome or mitigate our own shortfalls.
Trading models remain the backbone of risk management, but being able to lean on your customer base and price against their activity is a huge help when it comes to limiting volatility. It was unprecedented times for soccer, but as a trading team, it was just business as usual.
Euro 2020, as with any major short-term sporting competition, will test bookmakers to the limit in terms of managing greater revenue over a rapid-fire fixture list. This year’s event is bigger and busier than any before it, and it’s fairly likely we’ll see some record-breaking trading figures come July.
A return to normality like this is a major opportunity for the sportsbook sector. Fans returning to stadiums will drive the atmosphere, with the increased pressure coming from the stands against the backdrop of a quiet league season likely to result in some exciting action.
We can’t control for how these unknowns will impact results. We can only predict and adjust for any action we take from the time markets go live.
As soon as they do, that’s when we’ll start to see who’s making the most of this opportunity; those who stake sharp customers quickly and follow the market, or those taking pricing positions based on their own needs and the opinion of smarter bettors.
Fully-serviced trading teams are becoming a luxury few can afford to have. Operators not getting a return on their in-house outlay or outsourced partnerships should look seriously at what else is out there. There’s more than one way to trade a match, but in reality, only one right way.