SBC News Voice of the Sports Betting Industry
Aleksandr Glotov, a Senior Product Manager at Bayes Esports, explains the crucial elements that esports operators must keep in mind to ensure that a financial uptick and player retention are witnessed.
There is a lot of risk associated with gambling, whether you’re the one placing the bets or accepting them. For sportsbooks to manage risk, stand out from competitors, and maximise their revenue, they must have as much control over their product as possible, especially in the esports market, where the dynamics and unique characteristics of each tournament can impact the outcome of bets.
Margin management is a vital tool that gives operators complete control over their products and potential revenue. It is now more accessible than ever, thanks to Bayes Esports’ latest addition to its Bayes Odds Marketplace.
Our customers can apply margins manually to individual events or automatically through pre-defined templates. This tool unlocks a world of opportunities for sportsbooks aiming to optimise their risk management and attract new customers. With the ability to optimise your margins, you can ensure customer satisfaction and build a loyal audience.
The consequences of relying on default and blanket margins
Without margin management, sportsbooks may find themselves in a challenging position. They would be unable to adjust their margins at a granular tournament or market level. Sportsbooks would have to rely fully on their odds provider, giving them no control over their product, revenue, or risks. In this arrangement, sportsbooks would be normally left with three unappealing options.
The first is to adopt default margins which are set and managed by an external party. These are usually fixed with no room for customisation.
The second option is to apply game title-wide margins. Depending on your position, you could set one margin for Counter-Strike and a higher or lower margin for Dota 2. This blanket margin, however, doesn’t account for the nuances of individual tournaments. For example, a sportsbook in Brazil may want to increase margins for a local tournament, like IEM Rio, knowing that betting volume will be high. This, however, doesn’t mean all CS2 events in the future should have the same margins.
The third option is to build their own margin system from scratch. This can be an inefficient and time-consuming process, especially for those without a dedicated trading team for esports.
Without an advanced margin management feature, sportsbooks lack the control needed to differentiate from competitors, react differently to various events, or run tailored promotions.
Tailored margins to align with business strategy and market dynamics
Margin management offers a solution to these challenges by allowing sportsbooks to adjust their margins based on their business strategy, regional requirements, or market dynamics.
Instead of a one-size-fits-all solution, margins can be set based on a business’s specific needs. For example, a sportsbook whose goal is to acquire new customers can set lower margins as a marketing strategy. The company can roll out banners saying “bet with 0% margin for the upcoming IEM Rio” to encourage betting on the event.
Operators or sportsbooks that have a strong focus on esports may want to customise their margins to ensure they offer competitive odds. If esports is their USP they will want to become the go-to platform for their target audience.
Big betting conglomerates may also find margin management very beneficial. These types of companies may have acquired smaller, more regional sportsbooks, and use diverse marketing strategies to reach a wide audience. With big marketing budgets, they may sponsor major esports tournaments and therefore want to guarantee that bettors will primarily use their sportsbooks to place bets.
Customising margins can have a significant impact on standing out from competitors and attracting an audience but it can also help protect against financial losses. While it’s not a replacement for risk management, it can be used as a tool to dynamically manage risk. For instance, sportsbooks can adopt a high-margin approach for riskier events or lower margins to stimulate betting on key matches, allowing them to adapt to market conditions and mitigate potential losses.
Custom margin management for ultimate control
Bayes Esports has recently added this new margin management feature to its Odds Marketplace. It offers complete flexibility and easy-to-use UX design which makes it easy to react to market conditions or implement their own competitor strategies.
Users can apply custom margins to individual events or go as granular as adjusting the margins per market. This manual adjustment allows for ultimate control.
Sportsbooks can also set up pre-defined templates that can be used in future tournaments. Templates can be based on specific characteristics, such as ‘high-risk tournament’. This template would automatically set a higher margin for all markets in a riskier event, streamlining product customisation.
A must-have feature for sportsbooks
The feature has already been rolled out and is receiving positive feedback. With this added flexibility, sportsbooks can dynamically manage their margins, and react in real-time to market conditions and competitor actions.
This helps attract customers and ensures that operators can protect themselves from financial risks in volatile betting environments. This level of control is essential for any sportsbook looking to offer a high-quality odds product, especially those targeting sophisticated bettors and esports enthusiasts.
