Inside gambling's odd relationship with football

This relationship has indeed drawn significant attention from those in power, with both The Premier League and The FA deciding that their integrity can be questioned if they took the gambling industry's largesse. Most recently, The Labour party has pledged to outlaw gambling advertising in football, a move which would mirror similar initiatives to the banning of tobacco advertising in Formula 1. It remains to be seen whether a Corbyn-led government would make the same type of deal that the Blair government did with Bernie Ecclestone, and allow a period of transition so that football might wean itself off the gambling habit and find alternative sources of revenue. An immediate and unilateral ban would clearly have radical consequences for football’s finances.

Why is gambling in football?

Irrespective of the moral debate, the scale of gambling’s position in football is intriguing for anyone interested in the sports marketing business. What has driven such investment? Is it effective? And are any of the multiple brands involved actually doing it very well? In short, is the gambling industry making the most of its marketing assets?

The sports industry orthodoxy is that gambling is attracted to football because it offers two benefits, namely the ability to make a brand famous and secondly the power to make a brand credible. In a market with over 200 brands just in the UK, both of these objectives are clearly desirable. However, they are really only the beginning of the story.

The orthodoxy misses that in the last 10 years gambling on the many outcomes of football has become by some margin the major source of sports bets, accounting for more than 70% of all bets placed. So the reason that gambling is attracted to football? The fans of football have become the industry's best and most avid customers. However popular horse racing was, its previous dominance of betting could never generate the same sort of numbers as the world’s favourite sport. This transformation in the nature of betting, coupled with the digital revolution has been the key to the millions flowing in to the game from gambling and the proliferation of sites, brands and new entrants.

Married to this change in the scale and composition of bets is the relative cheapness and sheer abundance of football sponsorship, offering a low cost of entry for new betting sites with big margin’s to be made in a market low on customer loyalty. So football's ability to build fame fast, establish credibility, reach a new consumer with an interest in the sport and communicate a proposition is a given, but then what? So many brands stop at this point and the result is a market which resembles Steptoe’s yard… cluttered, jumbled, and full of horse sh*t.

Who is standing out?

The vanishingly few brands that have done it well in the sector have followed two essential principles. Firstly they have built a unique tone of voice, and secondly they have developed a totally differentiated creative proposition. This has allowed them to stand out from a very dense crowd, and build a proposition which means that they do at least appear different from the competition. The brands that stand out in this rarefied group would be Bet365 and Paddy Power. There is, however, a further step that can be taken which builds on this differentiated position, builds customer loyalty and may even keep the politicians at bay.

At this point, we need to make a slight digression to examine the nature of sponsorship and its uniqueness as a communications channel. Nobel-prize winning psychological-economist Daniel Kahneman identified that the human mind has two processing systems. The first operates quickly, instinctively and primarily on emotion. The second system is slower, analytical and rational. Almost all of our economic decisions are based on system one. This has profound importance for sponsorship, since it means that consumers respond much more readily to emotional communications, the very communications and responses that sponsorship is best equipped to deliver. So what does this mean for the final piece of our gambling business jigsaw?

An emotional connection

In short, it means that gambling companies need to build an emotional connection between themselves, the sport they are sponsoring, and the fans that both love the sport and are the brands consumers. This is best achieved via a creative platform which demonstrates that the brand understands the sport, understands the fans and most importantly wants to use its power to make the sport better for the fans and the game itself.

As we have discussed, the defining change in sports betting has been the shift to football fans betting on the multiple outcomes of the game they love and believe they understand. In a market where the missing factor is customer loyalty, it surely makes sense to recognise this deep and abiding relationship between the fans and their sport, and thus seek to use this as the core message in sponsorship communications. We do not mean paying lip service to this relationship, but to truly embrace it and in part show the fans that you love the sport too. Affinity with the fans is the way to build customer loyalty, and this can be achieved by showing an authentic approach to the issues which fans truly care about. Who knows, it may even serve to deflect a future Labour government.

So a strategic recommendation to build a truly differentiated position in sports most cluttered category? A gambling brand is best advised to develop a creative territory which places fans at the heart of the game, to support initiatives which are close to the concerns of fans, and make supporting football better. In short, find a noble purpose and work hard to improve football for its very lifeblood, the fans. Place your bets.

Phil Carling, is managing director of global football at sports marketing agency Octagon.