Fundamentación

2.7.1 Influence of gambling inducements on gambling behaviour

As reviewed below, a small amount of research has investigated the impacts on gambling behaviour of inducements provided by land-based venues. These studies have focused on the effects of loyalty programs, comps and venue promotions. Many of these studies have focused on a single venue and together have yielded mixed findings, so results to date are inconclusive.

Gambling loyalty programs

Research into the impacts of gambling loyalty programs has identified limited effects overall, but that different market segments respond differently. Barsky and Torzov (2010) used panel data from 4,894 US respondents who had recently visited a casino to identify differences in customer segments in their responsiveness to casino loyalty programs. They found that elite membership creates a very engaged group of customers; however, other market segments were largely unresponsive. Similarly, Palmer and Mahoney’s (2005) research found little effect of loyalty programs and that different segments had widely varying needs. They explained that the large numbers of gambling venues usually available to consumers, their substantial marketing incentives to attract new customers, and low switching costs between venues, means that gamblers have reasons and opportunities to patronise multiple venues and to join multiple loyalty programs. Customer loyalty to one particular venue can therefore be very difficult to gain.

Gambling comps

Inconsistent results have been found in studies examining the effects of comps on gambling activity. Studies in individual Las Vegas casinos have found no positive effect on blackjack cash drop from match-play coupons (Lucas, 2005), no significant increase in individual trip slot volume from a direct mail campaign with free-play offers (Lucas, Dunn & Singh, 2005), and no effect on the gambling volumes of slots and table games from complimentary showroom entertainment (Suh & Tanford, 2012). Further, Suh (2012) found that a $50 free-play incentive was more profitable than a $100 offer, implying that a higher incentive value is not necessarily more effective in increasing slot gaming volume and coupon profitability. Conversely, two studies have found positive effects of comps on gambling activity. Suh, Tanford & Singh (2012) found that the incremental gambling revenue from patrons receiving complimentary meals was much higher than those who paid for meals. Based on two years of loyalty card data from a US casino, Narayanan and Manchanda (2012) found that receiving comps was associated with a shorter time between venue visits, and that increased comps increased both short-term and long-term gambling activity.

Gambling venue promotions

Mixed results have also been found for the effects of in-venue promotions. Two studies have found that they increase expenditure on electronic gaming machines (EGMs). Research in a Las Vegas casino indicated that prize draws with higher cash prizes produced higher slot machine volume, reflecting that these promotions increased sales (Lucas & Bowen, 2002). An Australian survey of 414 respondents aged 60 years and over found that, of those participating in venue promotions (50%), 18% reported usually spending more time, and 14% reported usually spending more money, gambling on EGMs than they would have done without a promotion, and 8% reported being introduced to playing EGMs through a venue promotion (Southwell, Boreham & Laffan, 2008). Conversely, another Australian study (Edelhoff, Grimes & Battista, 2014) found that venue promotions did not affect gambling behaviour, although the combining of different types of promotions (loyalty programs, trade promotion lotteries, raffles and bingo) may have obscured results. Amongst the 120 members of six Australian clubs surveyed, about one-half agreed that these promotions had encouraged them to become members of the venue; about three-fifths agreed they visited the club more often and stayed longer due to promotions; and about two-thirds reported spending more money at the club during a promotion. Higher perceived value of promotions was reported to increase members’ length of stay at the club, how frequently they visited, and their expenditure in the venue, but not their reported

gambling activities. Use of self-reported data in both these Australian studies may limit the accuracy of their findings.

2.7.2 Influence of wagering inducements on betting behaviour

A few studies have examined the self-reported influence of marketing inducements on betting

participation, but none have distinguished the influence of different types of wagering inducements nor quantified the extent of this influence.

Hing, Cherney et al. (2014b), in an interview study of 50 gamblers from the general population and 31

problem gamblers in treatment, found evidence of increased gambling consumption amongst both

samples in response to bonus offers such as ‘free’ bets and bonus deposits. Several respondents

reported that they found promotions quite influential and would seek them out to take advantage of ‘free’ credits and signed up with multiple operators as a result. While this study revealed limited reported effectiveness of these inducements in converting non-gamblers to gamblers, they identified some brand switching amongst existing gamblers and increased gambling in response to promotional offers. However, their study focused on advertising and promotions for Internet gambling in general, and so did not yield a clear picture of the specific influence of wagering inducements.

Also in a qualitative study, Thomas et al. (2012b) found that young men in particular reported being encouraged by online gambling advertising to switch from physical to online betting environments, to open accounts due to ‘free’ bonuses offered, and to move between sports betting websites to take advantage of the different incentives offered. Many were reportedly focused on what was on offer, rather than any long-term risks or consequences. However, whether conversion to online betting and uptake of these betting incentives affected overall betting involvement amongst these participants was unclear. Older males were reportedly more circumspect about these inducements, and felt that the risks of signing up for these offers outweighed any longer-term benefits.

A series of surveys conducted as part of a large Queensland study (Hing, Vitartas et al, 2014a), and published as several papers (Hing, Lamont, Vitartas & Fink, 2015a, 2015b; Hing, Vitartas et al., 2014b) highlighted the appeal of sports betting promotions to adults, adolescents and sports bettors. This study focused on types of promotional techniques (e.g. celebrity endorsement, gambling logos, stadium signage) rather than types of inducement. However, the study did find that about one-third of sports bettors agreed that the promotion of special bet offers (e.g. available only to the first 100 callers) during a sporting event encouraged them to bet on the sport to which this inducement applied, and about one-quarter agreed that it increased the likelihood of them placing impulse bets during a sports match.

A quasi-experimental stage of the same study (Hing, Vitartas et al, 2014a) also highlighted the greater importance of type of bet in eliciting the desire to place a bet, compared to type of commentator, type of promotional technique and type of appeal used. Amongst the types of bet included in the conjoint design, bets offering a money-back guarantee (if the team bet on lost by 10 points or more) had more appeal than a traditional bet (on the outcome of the match), an exotic bet (which team would score the first point in the match), and a micro-bet (which player would give away the next penalty). In fact, the utility for ‘risk-free’ bets was so strong that all other utilities had little weight in countering its effect. The authors concluded that this indicates that, in the marketplace, a ‘risk-free’ offer will have very strong drawing power on bettors and strongly entice them to make a bet.

In Sproston et al.’s study (2015), focus group participants drew attention to promotional inducements conveyed through direct marketing including by email, SMS and telephone, as well as through mass media, and also that these promotions increased in the lead-up to major events. They commented on the pervasiveness of inducements offering matching bets and deposits, refer a friend bonuses, and ‘risk-free’ bets that offered a refund under certain conditions for losing bets. Some participants commented that ‘risk-free’ bets in particular can create the false impression that winning the bet is a certainty, and so they can be highly influential in encouraging betting. In fact, while participants

generally felt that they themselves were not highly influenced by wagering marketing (although they felt that others were, indicating a third-person effect), promotional inducements were one type of marketing that was felt to directly influence even their own betting. These promotional inducements were said to have encouraged some participants to open wagering accounts and others to shop around for the best incentives, while some participants clearly enjoyed getting ‘free’ bonuses for bets they placed.

While far from conclusive, the above findings suggest that promotional inducements do have an influence on betting participation, and in fact may be more effective than other types of wagering marketing in increasing betting behaviour. However, this influence has yet to be rigorously quantified and is likely to vary amongst different demographic groups. While brand switching in response to inducements was reported, there is also self-reported evidence that these inducements increase betting consumption and impulse betting, especially amongst existing sports bettors who may also shop around for the best deals. ‘Risk-free’ bets appear to particularly encourage additional betting, although further research is needed to verify this contention.

2.8 Influence of wagering inducements on gambling