iGaming Daily

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Football weather is already here and the NFL season is right around the corner which is why betting companies are already preparing for what's coming which is an exciting new football season and today we will use football for American football so to our European listeners keep that in mind. Welcome to iGaming Daily supported by OptiMove, the number one CRM marketing solution for the iGaming market and proud to be at SBC Summit Lisbon this September. I'm your host for today Fernando Nott and I'm Happy to be joined by Jeff Laniato from Optimo. Jeff, happy to have you back on the podcast. are you today? Doing well. Happy to be here. Thanks, Fernando. Well, how excited are you for the football season? Yeah, counting down the days. Week one is a little bit of a holiday here in the US. It is an exciting time of year, not only for sports fans, but obviously working in the gaming industry and working with different clients, different sports books. It's definitely a hallmark point of the calendar year. Looking forward to that first kickoff. A few episodes ago you were together with Charlie Horner here and I didn't, you didn't seem so eager to watch your New York Jets though. Yeah. I think as a lifelong Jets fan, most uh Jets supporters know the disappointment that inevitably comes with the season. But as we are and O to start the year, the optimism is at an all time high for now. But Yeah, the sky's the limit until the actual football starts. So we'll see what happens. Yeah, I think Justin Fields is going to do just fine for you guys. I mean, he's not a franchise quarterback, but I think it's a good signing for the year. So Mark My Words is going to do well this season. But of course, we are here to discuss sports betting industry. This is a gaming podcast. And um in the US, of course, the sports betting market is some, at some extent mature because sports betting is a very old tradition, of course, but in terms of regulated markets, it has evolved in the U.S. and continues to change over time. So where does the country stand ahead of another football season, Jeff? Yeah, the U.S. market is extremely dynamic. You know, we talk about the U.S. market as a single entity, but as you're aware, the US market really consists of a lot of different dynamic jurisdictions, different states have different levels of maturity and headed into this football season, we're at an interesting point where a good portion of the US population still does not have access to online sports betting. A good portion of the population has had access for a number of years. I live in here in New Jersey and Pennsylvania and Michigan and some of these states have had online sports betting accessible for a number of years at this point. live in these more mature markets that have played out. And now we have new states still being added on, right? So Missouri, we are anticipating Missouri being accessible and opening up by the end of the year in the middle of football season, most likely. And for those markets, they had a completely different dynamic and a completely different level of maturity than New Jersey, for example. And I think that the strategy is really dependent on which jurisdiction we're speaking about. new states like Missouri. think we've seen some cautionary tales over the years of sports books going into new states, being overly aggressive, overly generous with signup bonuses and promos and maybe getting out to a early lead, but eventually conceding market share as the earth comes crashing down and the market share kind of settles into place. And I think that that has proven to be a a little bit of a questionable strategy, right? I think sports books need to identify the right types of players that they wanna be going after. And for the more mature markets, as we talked about last week, the key there is really digging into that existing database, identifying the right types of players that we wanna reactivate, that we wanna retain, and using different CRM strategies, which we'll talk about, to reactivate those players to retain them in those more mature markets. Well, speaking of player retention, Of course, there's a big buzz ahead of week one. We are all excited about the NFL coming back. It's been a while since the Super Bowl, but the football season is finally here again. the week one is going to be like a major event for betting companies. But as the season goes on and on, uh most operators will probably face player churn in the future. So leaving aside that some bettors will completely drop. NFL betting until the Super Bowl or maybe the playoffs. uh What are the dos and the don'ts for gaming companies throughout the season to drive retention and engagement and uh maybe reduce that player share? I mean, what I'm about to say, I had my hand slapped for saying this by an executive at a big tier one operator at one point, but sports betting and online gaming in general is largely a commodity. If I wanna bet on the Yankees tonight, I live in New Jersey and I can do so at a number of different apps and more or less, you know, give or take some odds in either direction, I can bet on the Yankees, right? It is for the most part a commoditized product. It's very different than other industries where if I want an iPhone, I need to buy it from Apple. And so if I wanna bet on the Yankees, I'm not limited to one sports book to do so and you know, it essentially comes down to a commodity. Now there are, areas that sports books can differentiate. think product is the number one by far, I would say. There's no secret as to why some of these sports books have gained greater market share, have come out as tier ones. A lot of it comes down to product and the user experience and the interface that their customers are able to leverage. so product is that one major area of differentiation. The second and the one that my bias lies around is CRM and personalized marketing and targeted offers and how do operators differentiate themselves by having messages and having content that is engaging and tailored for their specific players based on who they are what they wanna see. And this is another area of differentiation. I'll quote one of the big operators, one of our big clients, Ben MGM, Adam Greenblatt earlier this year, one of the earnings calls, He talked about having a 37 % increase in handle per active user. And a lot of this was credited to smarter segmentation and what he called more surgical Provo targeting, which really comes down to CRM. And an increase like that from your existing customers is really what every operator is looking to achieve. They want to take the existing database, the players that they have, grow their handle, grow their ARPU. And oh it was great to see him call out segmentation because that's one of the things that, especially from Optimo's perspective, we really preach as an approach to creating more personalized and more engaging messaging. And when we say segmentation, on the surface level, we're talking about carving out different groups of players based on who they are, right? What do they bet on? When do they play? What kind of promos? What channel is most relevant for them? all these different aspects, all these different variables that each player has different preferences around. How do we carve out these different groups of players and then target them based on who they are? Now, this is nothing groundbreaking and nothing that we invented at OptiMove, the idea of really targeted segmentation. think every operator has the goal of doing this. But one of the challenges that these sports books face when they look to create a lot of different segments, when they target players based on NFL or parlay or Sundays only or low balance or this tier or mobile only, right? All these different data points that we have available to segment based on what inevitably can and does happen is Jeff wakes up on a Sunday and my favorite team, the Jets are playing that day and my balance is also low. And that's a different segment that I'm becoming eligible for. And, you know, I also just hit a parlay. previous day and so that makes me eligible for a campaign. And maybe I'm also on the cusp of graduating to the next VIP tier and that's another campaign. And we have situations where players are finding themselves eligible for four or five different campaigns in a given day because we have all these segments and players are falling into these different criteria based on who they are. How do you decide as a marketer which campaigns should Jeff get on that given day? Should we send all five? Probably not. Should we send one or two? Maybe. And how do you know which one or two are the right campaigns to send? What campaigns are gonna drive the best uplift? And this kind of evolves from segmentation into what we categorize as orchestration. These big decisioning points that when we have these situations where we have crossfire and we have overlapping campaigns, and this of course can happen at scale across thousands and tens of thousands and hundreds of thousands and even millions of customers, how do you make decisions at scale about which campaigns and which segments we should be targeting? And this is something that we really pride ourselves in solving for at OptiMove. Mr. Greenblatt rightfully called this out in the earnings call earlier this year that it's one of the ways that they were able to increase their revenue per user by 37%. So uh yeah, it's certainly one of the things that we're preaching to our clients. pretty regularly at OptiMove. Well, I think you pretty much just covered what I was going to ask just now, which is how can operators know they are targeting the right consumer at the right time in order to drive engagement instead of just annoying them. And I think you just said pretty much it's through data, right? And I say annoy them because I remember I'm based in Argentina in Buenos Aires. This is a kind of new market. feel it could be related to some of the United States markets. And I remember creating an account, me working in the gaming industry, creating an account in different operators just to check them out, how did they work, what issues they had. And over time, I would stop interacting with these platforms, of course, because maybe I chose one and every now and then I would place a bet. But there was this one operator that kept calling me over and over again. And they were like, hey, why aren't you playing? Do you want to come back to the platform? And I think uh it's a very delicate aspect when you have to reach out to the customer, right? Yeah, mean, I think the best way to establish when we are annoying a player, quote unquote, or really engaging with them is really through testing. And one of the ways that we think about how do we understand if a campaign is driving results, if a message is actually creating a meaningful uplift is using a very scientific approach to measurement, which we kind of call test first control. So the idea is that when we send a campaign to a player, we wanna also carve out a control group or a holdout group. And then what we do, and I'm oversimplifying this a little bit, is we wanna measure the uplift. We wanna measure that difference that by sending this campaign or by not sending this campaign, what is the actual incremental uplift that we're driving by sending out this message? Now, again, there's a lot of nuance that goes into how do we decide who goes into which group, and there's also a lot of sophistication around. what are we measuring, right? So we may be impacting NGR, but we may not be impacting GGR. We may be increasing the average deposit amount, but we may not be increasing total deposits or whatever the case is. So being able to measure specific KPIs and metrics is also really key in this measurement process. And so there's a lot that goes into when we send out campaigns, whether that's an email or a push message or a pop-up or SMS or whatever the means of communication is, we are constantly looking at the data and saying, did we drive uplift? Did we create incrementality by sending this message? And this is how we start to make this distinction of, are we annoying our customers, right? Certain emails or messages at a certain threshold can start to have an adverse or negative effect. And making sure that we're continuously monitoring this and saying, hey, when we go from two messages to three messages, we're actually seeing a negative impact on the customer's lifetime value, for example. And that's how we identify what is that threshold. And of course, different players may have different thresholds and different tolerances for different messages that, even once we start to get into the specifics of channels where maybe one player doesn't mind getting two emails in a day, but for another player, any emails at all is problematic, but they don't mind getting mobile push notifications. So really being able to dive deeply into all these different data points and all the different variables that come into play. That's how we identify is our marketing working. And, you know, there's a there's a famous quote that has been said many probably in every ad agency across the world for the last century. This guy, John Wanamaker, said this a long time ago. He was a retail pioneer. He started this department store, which was eventually sold to Macy's. And he's probably more famous for the quote than his actual business acumen at this point. But he said, Half the money that I spend on advertising is being wasted. The problem is I don't know which half. And I think this rang true for a long time, especially prior to the digital transformation of especially online marketing that, know, companies, not just in gaming, in every industry, they would spend money on TV ads and billboards and magazine inserts. you know, they knew that some of it worked and some of it didn't, but it was really difficult to identify what portion of it was actually driving and increase. Now in the world of online marketing and digital marketing, and especially layering on these more sophisticated mechanisms that a platform like OptiMove gives you, we can really acutely identify, hey, we sent out this email to 10,000 players. And because we sent this email, we were able to drive an increase in deposits of $55,000. Or because we sent this push message, we were able to increase our average deposit amount for these players by 20%. So I think, you know, hopefully the more sophisticated operators are adapting this new mindset and they're not quoting the old adage from our friend John Wanamaker anymore. Well, speaking of halves, we are going to do a very quick ad break and continue talking about strategies ahead of the football season in the United States. We'll be right back. And we are back with more iGaming Daily ahead of the NFL season discussing what operators need to do ahead of the football in the United States. Jeff, um we were speaking about retention, of course, and um while players tend to prefer, and actually I was reading your report on NFL wager intentions and saw that players do actually prefer uh Over and under, point spread beds, all that stuff. Over live betting. Live betting is still a part of the game and I imagine a better like other house with their friends watching uh a uh New York Jets game and saying hey, why don't we bet on, I don't know, Justin Fields is playing really well, why don't we bet on him scoring two touchdowns or something. um So how important are apps for um customer retention and also of course uh user experience because maybe you open an app and it doesn't work like you would expect and you're probably gonna drop that platform, right? It's hugely important. And I think it's becoming increasingly pervasive that customers are using the mobile apps to place their bets as their primary means of accessing these sports books. And the data that we just released and of course we sit on top of a lot of different information from. various operators, the latest report is that 76 % of customers prefer to place bets on mobile. And that number has increasingly, has gone up steadily and I think it'll continue to increase. even just speaking from my own personal experience, I think over the last several years, I've become more comfortable doing tasks on my iPhone than I had previously. uh resort to my laptop, for example, I'm now willing to book a flight on my phone. And I think for many years before this, booking a flight was always a laptop activity. And I think that there's a combination of things. think partially it's that a lot of mobile apps are just, they've gotten better, they've gotten slicker. The user interface and the UX is really strong. And there's no gaps in functionality in what you're able to accomplish on the mobile app versus a website. And that has certainly translated over to sports betting, right? So the mobile app as a platform for increasing bets, it does translate into how do we market to those players and how do we retain them for a variety of reasons. we may, for those 76 % of players that prefer their mobile app, we may want to time our messaging around those players preferring the app and not needing to be at their laptop. If we have players that, you know, it's ahead of one o'clock kickoff for NFL Sunday, we know that players who are betting on mobile, we can probably send that message a little bit closer to game time than players who are resorting to their laptop to place bets because they need to be in front of their computer to get those bets in. So the timing of player and also understanding who prefers mobile and who prefers web, right? So, you know, that's all goes back to data and really having that deep understanding of who your customers are and what they prefer. obviously channels and the actual way in which we're communicating is key as well. Those 76 % of players that prefer mobile, there's a high likelihood that they're more reactive and they're more responsive to mobile push notifications. If we have a player that's in the 24%, or we have players that we know are exclusively placing their bets on their laptop, a mobile push notification is probably not the most effective way to reach them and engage with them. So being able to understand player behavior in which know, experience they prefer should really dictate how we're speaking to them and making sure that we're communicating in the platform that they have the highest, you know, level of comfort with. And then even the more sophisticated mobile capabilities come into play where what a lot of our clients can leverage is geo-targeting. And so, you know, one of the advantages that we have in the mobile, in the online gaming space, and, you know, I often compare online gaming to other industries, One of the luxuries that we have is location services are enabled for mobile users. This is a luxury that a lot of other industries, they don't require it and then they don't receive it. So we have location services about our players. And when a customer enters a specific area or a specific landmark, if I go onto the premises of MetLife Stadium at 1230 on a Sunday, you know that I'm going to the Jets game or the Giants game that day. And you know, the really sharp and advanced CRM marketers in the online gaming space are using that as an opportunity to engage with that customer. We know I'm at the game. There's probably a higher likelihood that I would bet on that game being at the event. As soon as I enter this specific geofence, target me with a mobile push notification for this game. could do the same thing with Buffalo Wild Wings or any sort of location, the really sophisticated marketers are leveraging location services to be able to target players and have personalized content based on where they are and what their propensities may be in that moment. Jeff, speaking of data, your report says that 82 % of bettors keep betting even after their favorite team is eliminated and 83%, well that's 1 % more, will bet on the Super Bowl regardless of which teams are playing. How do you make the most of that interest in betting, in betting on football? And how do you, or how can you target those 17, 18 % that might only be interested in betting in their favorite teams? Yeah, the favorite team piece is interesting. I mean, I think, you know, it's interesting how different operators are defining favorite team, right? So we're seeing a wide range of models and, you know, decisions around how we're identifying, this is this person's favorite team, is it something that they're self-selecting and I'm going on and I'm filling out a survey or I'm filling out some sort of uh gamification element where I'm saying, hey, my favorite team is the Jets and now I'm registered as my favorite team being the Jets. Is it the team that I'm placing the most bets on or the highest share of my revenue is going towards? And maybe we're even making that distinction between favorite team that I root for or favorite team to bet on. And that could also dictate the nuance in how we market to that player. So really understanding how we're defining favorite team and then even making favorite team multi-dimensional, right? So again, we have a lot of data. We look at favorite team. We also have a lot of data about uh everything that surrounds favorite team. So I'll just use myself as an example. I like the jets. I'm more likely to place bets on the jets. I'm also more likely to place player props on the jets. Or maybe because the Jets are in the AFC East, I'm more likely to bet against the Patriots or players that came from the Jets. Am I more likely to bet on or against them? You you may, uh you know, hypothesize that a 2025 Jets fan is going to be betting against the Steelers a good amount because they are anti-Aaron Rodgers. So there's all these little pieces within favorite team that you can leverage to not just make it one dimensional. And, OK, this person likes this team. Let's put these bets in front of them. There's all these other variables around that that you can use to increase the number of bets they're playing, the revenue that you're getting from these players. And I think favorite team is, it's always one of the first elements of personalization that we talk about. Maybe it's one of the easier ones to identify, which is fair. But when we start to incorporate all these other different personalized data points that we have about a player, so favorite team is one. What is their favorite time to play? What is their favorite type of bet? Do I like player props? Do I like over unders? Do I like five leg parlays? We have all these other favorites. We have all these other data points that we know and preferences about customers. When you combine everything together and you take not just my favorite team, but the favorite bet type, the favorite time to bet, maybe the favorite odds, right? Maybe I like betting on favorites and I like. or let's say I like betting on underdogs and I like plus two fifties, I'll make it underdog because I'm talking about the Jets here. And you combine all of these together, you really get a multi-dimensional look at who that customer is and what their preferences are, what they would like to bet on it. You know, at the end of the day, it's a little bit of an art and a science. We can do all the right things. We're never gonna retain every player. We're never gonna reactivate every customer. It's a little bit like. you know, planting a flower, you can plant the seed, you can water it, you can give it sunlight, sometimes it just doesn't grow. But over time, doing all these little steps and all these practices will increase your KPIs and your retention metrics. Over time, it can have a meaningful difference. So, you know, not just looking at favorite team and incorporating all these other data points that operators have and getting this really multi-dimensional view of a player really is key in. retention and engagements and all these metrics that we care about. Jeff, you have given us a lot of insights on betting ahead of the NFL season. I can say good luck on the NFL season because the Philadelphia Eagles, the team I like the most, are playing just only on this regular preseason game next Friday. So good luck on the season and hopefully we can record a new episode ahead of the Super Bowl when the Jets and the Eagles face on February, right? I'll take you up on that. Yeah, absolutely. Jeff Laniato, Director of Sales at Optimo. Thank you very much. Thank you very much to Neyya Macdonald for producing this episode and to all listeners out there. We'll see you in the next one. Goodbye.