UK gaming brands are seeking to use more sophisticated forms of ad tech, including the use of retargeting technology as well as more sophisticated forms of prospecting, as research reveals the public are beginning to place an increasing emphasis on responsible marketing. But operational issues, plus potential regulatory impact on revenues leave are stalling many decisions. 

Online gaming brands are some of the highest spending brands when it comes to marketing in the UK, where the market is valued at over £2bn per year, and are increasingly starting to look to the use of programmatic technology as an alternative to TV as a means of attracting new customers.

However, most are employing a cautious approach as the highly-regulated sector means brands can ill-afford a high profile case of ad misplacement as the ever-watchful authorities there such as the Advertising Standards Authorities (ASA), the Gambling Commission, as well as the UK Government itself, become evermore watchful.

The survey – named ‘Betting on Digital’, produced by IgnitionOne, ComRes and With PR – surveys over 2,000 adults, as well as 11 marketers in the sector, to compare any disparities in their respective attitudes and found that ethical practice was key to building/retaining brand equity in the market.

Of the polled consumers, then 21% report that ad targeting from brands in the sector could be conducted more effectively/responsibly, along with 72% agreeing there should be greater regulation to ensure that companies act responsibly towards customers (including regulation and advertising).

The report demonstrated that each of the 11 marketers participating in the poll agreed that investment should be made in establishing a strong brand reputation. An additional finding among online marketers surveyed was that they recognised how their industry can be perceived as an unscrupulous sector, which does not care for its customers and is rife with scams.

The participating online marketers agreed that more investment is required to combat this notion among consumers, but the pace of change appears to be slow, with some sources reporting mixed attitudes among brands themselves when it comes to just how important a role digital should play in their marketing mix.

For instance, responding to the consumer reaction that four-in-five respondents think that online advertising for gambling brands targets an inappropriate audience, Faye Morse, Mansion, head of marketing communications, says: “I think this is unsurprising historically, due to the fact that in the past casino companies have gone very much for the mass market. It was always a numbers game, if you put your casino in front of X number of potentials, then Y [number of] players will sign up.”

Progressive views towards programmatic

However, Morse does note that more sophisticated attitudes towards advertising are starting to take remote within these brands, and that the need for more selective marketing means that programmatic, data-driven advertising techniques – either through buying media through exchanges or more direct channels – is likely to play an increasing role in the mix.

She adds that in order to get ROI brands need to be more selective in their audience targeting, otherwise costs are too high to make a campaign effective, this includes using retargeting advertising channels such as Facebook’s platform that lets advertisers message customers that have downloaded their app but since become “dormant” on the social network’s mobile app.

“Even TV broadcasters like Sky are introducing new technology to be more targeted (such as Sky Adsmart) where different households see different advertising based on factors such as age, affluence, region, etc, so the “blanket” approach is dying out even in these advertising approaches,” says Morse.

“I would hope that this more highly targeted acquisition approach should help to change this perception in the future, however this is in the media that we are in direct control of as a business.”

However, she also notes that working with third-party affiliates does increase the likelihood of the online gaming sector’s reputation coming into disrepute.

“We are very selective in our advertising and also keep within advertising standards guidelines for all of our methods used such as TV broadcasting, direct mail, magazine advertising, etc. All of our email/SMS communications are permission based,” says Morse.

But she also notes: “Most online casinos also have a high percentage of affiliate traffic that also drives new players into the casino. This is an area that is more influenced by third parties and therefore harder to influence.”

Disparity in opinions

Although Mansion is beginning to assess the idea of making use of more programmatic ad tech, such as trialling retargeting techniques for its casino apps, plus more sophisticated use on of online prospecting,  to help hone its marketing techniques. But not all parties are so progressive in their thinking.

Simon Haynes, IgnitionOne. UK managing director, explains that the survey relayed a variety of attitudes with some marketers echoing Morse’s initial claims that in days gone by (and as still is the case for many) the marketing game is still essentially a numbers game akin to ‘spray and pray’.

He says: “Do gaming brands need to be proactively projecting a positive image to the public? The results certainly do provide us all food for thought.

“For example, many of the marketers we spoke to had a firm belief that TV still drove the strongest results, yet the consumers we polled placed an equal weight on both TV and online when asked through what means they were directed to online gaming sites.”

This is reflected in some of the sample quotes taken from the report. One  senior marketer for a portfolio of online gaming brands, told ComRes: “It’s the rate of change and getting used to new solutions…There’s a lot of pressure to keep on top of day-to-day delivery that doesn’t necessarily allow you to walk around with your head up looking at what everyone else is doing.

“We try to bring agencies into our business to really speed up what is happening in the market. It’s tough, things are changing all the time – you want to be at the forefront but you obviously have to deliver what runs the business on a day-to-day basis, you also have to have technical implementation of what you’ve already got and some scoping of what you want to achieve in the next 12 months.”

Impending regulation raises questions

Clive Hawkswood, Remote Gambling Association, CEO, explains that impending regulation in the UK gambling sector is currently pre-occupying the minds (and budget priorities) of many gambling brands, but notes there has never been greater pressure for brands in the sector to be more efficient with their spend.

He says: “When the UK Place of Consumption Tax [which proposes a 15% tax on online bets placed in the UK with those gambling brands based overseas, i.e. most of UK online gaming brands base their overseas operations in Gibraltar or Malta] kicks in from 1 December 2014 it will put huge pressure on marketing budgets, and as available spend decreases the need to spend the remainder effectively becomes more important than ever.”

When asked about concerns over whether governments will step-in to legislate more aggressively if gaming brands don’t improve perceptions over their abilities/willingness to target their online ads more effectively, he added: “That’s always a risk, but we would hope and expect that governments and regulators would seek first to identify the real harms and their level before attempting to put in place additional regulations to deal with them.”

Hence it appears that a paradox is at the centre of the multi-billion online gaming sector’s willingness to invest in more progressive digital marketing tactics with the potential for having 15% of their revenues cut from their collective bottom lines leaving many brands in the sector with difficult questions for their marketing departments.