How has the gambling industry reacted to lockdown – and who are the biggest winners?

Find out how the gambling sector has been impacted by the COVID-19 lockdown, and who the biggest winners in the industry are.

Lauren has been Head of Client services at Crimtan for five years. In that time she’s built  a powerful customer servcies team to build strong relationships, fulfil client expectations and provide incremental to advertisers’ overall marketing strategies.

We asked her how the COVID-19 lockdown has impacted the gambling sector, and how our clients have adapted their businesses.

What impact has the lockdown had on the gambling industry?

While the COVID-19 pandemic has had a huge impact across all verticals, the gambling sector has been a little more complex. Some areas of the industry have benefited massively, while others have struggled.

On 20th March all retail gambling establishments closed, meaning that, immediately, activities that normally generate 50% of the overall market (excluding lotteries) stopped.

A large factor in initial revenue loss came from the fact that many sporting events were cancelled, along with the festivities surrounding them. However, the lockdown has brought significant consumer behavioural change and major impacts on the gambling industry.

The change in the market conditions has not bought many new customers to the gambling sector, however there have been noticeable trends of existing gamblers testing new products and changing the way they would usually gamble.

According to You Gov research, those who gambled were more likely than the national average to have done the following:

  • Spent more money online on entertainment (17% of gamblers compared to 13% of all adults)
  • Watched TV more (50% of gamblers compared to 42% of all adults)
  • Consumed more on-demand entertainment (48% of gamblers compared to 40% of all adults)

How has this impacted your clients’ campaigns?

Advertisers have had to react quickly and shift their marketing strategies. Lottery brands had to adapt their strategy from the traditional buying tickets in store method to educating and encouraging users to purchase digitally online.

For a large proportion of The National Lotteries’ consumer market this was a challenge due to the age range of users who enjoyed purchasing their tickets in store.

Interestingly, with more users working and browsing the web from home, advertisers like The National Lottery saw a 300% spike in traffic to site throughout March. This was largely because consumers were no longer going to supermarkets and retail establishments to purchase their tickets and scratch cards.

Other advertisers who relied heavily on sports events for their betting pushes, had to quickly steer their direction to virtual gambling. This proved to be a success for companies like Betfair, who have been hosting virtual sports events around the clock, which has seen a surge in users now playing virtual games.

There has been a 40% increase in users who are now betting on virtual games, including online bingo, casino or slot games. It will be interesting to see how this trend continues with sporting events slowly starting to come back.

What’s the biggest challenge currently facing gambling brands?

One of the largest struggles for many gambling clients was the reliance on sporting events and the amount of sales that were severely impacted immediately with lockdown. These advertisers had to quickly shift their position in the market and their reliance on these events to virtual gaming.

The biggest challenge for The National Lottery was that consumers were no longer able to purchase their tickets in store. Store purchases account for a large proportion of overall revenue, which was quickly lost.

There was an initial fall of overall sales figures, however sales quickly recovered which was a result of a change in consumer behaviour, and a significant move from retail to digital product sales.

The National Lottery had an amazing response to the COVID-19 pandemic. They generously supported local businesses with a budget of £600million, which has helped save millions of businesses and included support for food banks and helped reduce the causes of loneliness and isolation. There is also help for the elderly and projects that support health in the community.

How have we helped our clients adapt to the challenge of lockdown?

For The National Lottery we were very responsive through lockdown to adapting to the “new normal”. As people were unable to go to the shops, we adapted our strategy to start focusing on the older generation who would have previously purchased their tickets in store.

We did this by targeting publishers with a higher average age range on sites such as cross words, take a break, TV guide, gardening domains etc.

As a result we saw a huge peak of conversions throughout March – May with CPAs coming down by 275% throughout this period.

By quickly shifting our targeting approach for prospecting strategies to hit this demographic we were able to let these customers know that there is still a way to buy their lottery numbers, and drive them to the website to learn more.

Throughout this period, we also pushed the £600m support campaign, which was great for driving awareness to all prospective and existing customers to show what buying your ticket contributes towards. The kinds of good causes that The National Lottery were supporting were phenomenal.

Who have been the biggest winners in the pandemic?

Whilst the industry has been carving its way through the COVID-19 pandemic, the advertisers who have quickly adapted their marketing strategies are those who have been the most successful. I.e betting companies now promoting e-sports opposed to real sporting events.

Those that have adapted their instore user experience to a smooth online experience for customers have also fared well.

The success of an advertiser throughout this journey is their ability to be agile and promote relevant messaging towards their loyal client base. It is important to keep conversation going with your consumers through your marketing channels to continue to build an established relationship and brand loyalty with consumers.

What opportunities are coming up for the gambling industry?

While many other verticals may be holding tight and making cuts on advertising and promotions, the gambling industry is expected to do quite the opposite.

There is a wealth of sporting activities set to kick off this autumn and beyond, off the back of a dull three months for these types of consumers. This is the time for gambling advertisers to take advantage of the market whilst users are excited to get back out to these types of sporting events and start placing bets.

Finally, what’s your prediction for the immediate future?

With real sporting events beginning to come back into play, a new normal is starting to re-appear which will provide a new way of life for consumers. It will be interesting to see the impact this has on games such as bingo, slots and online casinos. Will this trend revert straight back, or will users change their usual behaviour and carry on with these types style of betting?

Advertisers need to bounce right back, promote the relevant messaging to their audience and ultimately hit the core marketing KPIs.

Want to know more about how the gambling industry can thrive throughout COVID-19 and beyond? Contact Lauren to learn more about how our data, creative and investment strategies can help.