Protocolos de comunicación LoRa

5.2.1 Prominence of inducements

Inducements were generally prominently displayed on operator websites, most often as colourful, eye- catching static or scrolling displays. While some inducements were confined to a specific promotions or specials page that linked to the homepage, inducements were also frequently present on the homepage, and were sometimes launched as full-page displays on opening the website (which then had to be navigated past to get to the home page). Due to the prominence and placement of

inducements, customers would not be able to avoid seeing at least some of those on offer when visiting most operator websites.

It was not within the project scope to examine the promotion of inducements on betting apps and in other media. However, previous research indicates that wagering inducements are widely promoted in a range of traditional and digital media, and through mass media, social media and personalised communications sent directly to customers (Gainsbury, Delfabbro et al., 2015; Sproston et al., 2015). Inducements are also heavily promoted on television when sporting and racing events are broadcast (Milner et al., 2013; Sproston et al., 2015; Thomas et al., 2012a). Thus, the promotion of inducements is a frequent feature of wagering marketing in Australia and this study has documented their prominent and ongoing promotion through operator websites.

5.2.2 Most inducements change frequently, but some are perennial

Continual changes to the inducements offered during the audit period reflected the specific nature of the bets/events to which they applied, although the audit’s classification of inducements into 15 overall categories indicates that most are variations on a limited range of generic types. Not only did the details of inducements change frequently, they also increased towards the end of the week in the lead-up to weekend sports and racing events. This frequent refreshment of many inducements provides a steady and continual stream of new short-term offers which may help to keep the betting product interesting for customers and encourage frequent visitation to wagering sites to stay informed about the latest offers. Previous research has also shown distinct seasonal variations in wagering marketing, with increases prior to major events (Gainsbury, Delfabbro et al., 2015; Sproston et al., 2015); however, this was not able to be measured in the short time frame of the current study. Inducements that largely remained unchanged throughout the audit period were those specifically targeting new customers: sign up bonuses and refer a friend offers. Attracting new customers is clearly of high priority for wagering operators, with one company reporting in February 2014 that it was

spending an average of AU$561 to sign up each new customer to one of its three Australian sites (William Hill, 2014). Because these recruitment inducements were not tied to specific bets or events, they did not need to be continually updated, although it is interesting to note that some brands did alter the value of their sign up bonus during the audit period. The reason for this is unknown.

5.2.3 All inducements are price promotions

All inducements identified in the audit were price promotions offering temporary price cuts, monetary savings, bonus bets or refunds. The incentive in each was some kind of financial bonus, mainly in the form of bonus or ‘free bets’ (although with conditions on use and redemption). Previous research has found that, amongst different types of sales promotions, price promotions are most effective in inducing purchase acceleration and more spending (Shi et al., 2005) and substantially increase short- term sales, sales of complementary items and store traffic (Blattberg et al., 1995). Thus, wagering

inducements offering price promotions may be likely to increase visits to operator websites, sales of

the incentivised bets, and sales of additional bets.

However, continual price discounting risks lowering consumers’ reference point, and can result in a ‘race to the bottom’ amongst brands in a highly competitive price war. This encourages bettors to search for the best deals amongst operators, which has been facilitated by the emergence of websites dedicated to comparing wagering inducements. This shopping around is a common practice reported by bettors (Hing, Cherney et al., 2014a, 2014b; Thomas et al., 2012b), thus undermining rather than boosting brand loyalty. Lower prices across the industry offer savings for customers on individual bets, but are also likely to result in increased product usage, betting with multiple wagering operators, and increased exposure to a plethora of marketing communications received as each additional betting account is opened.

Both alcohol and tobacco pricing has been found to have public health effects. A systematic review

(Brennan, O’Reilly, Purshouse & Taylor, 2008) found that increases in the price of alcohol reduce

alcohol consumption, hazardous and harmful alcohol consumption, alcohol dependence, the harm done by alcohol, and the harm done by alcohol to others than the drinker. Similarly, research has found strong support for an inverse relationship between price and cigarette smoking (Gallus, Schiaffino, La Vecchia, Townsend, & Fernandez, 2006; Scollo, Younie, Wakefield, Freeman & Icasiano, 2003). Thus, lowering the price of betting is likely to increase overall betting consumption, although the differential effects on non-problem, at-risk and problem gamblers has yet to be ascertained.

5.2.4 Wide range of inducements and incentives

The inducements identified in the audit were classified into 15 different types, reflecting the wide array on offer, especially when the continual changes to specific bets and events they applied to are also considered. These inducements include diverse incentives to overcome consumer inertia related to purchasing and appear to have variable aims.

Refund/stake back offers and winnings paid for losing bets are aimed at lowering perceived risk, while inducements for multi bets might be considered a means of increasing the volume of bets, as are some free bet offers (e.g. qualify for $1,000 in free bets if a bet is placed on every race that day at a particular race meeting). Mobile betting inducements are clearly attempting to convert customers to betting via smartphones and tablets so that future betting is more easily accessible, anywhere and at any time. The payment of incentives in bonus bets or deposits with play through conditions before any

winnings can be withdrawn locks customers into future betting with the operator. Provision of better odds is a competitive strategy to attract bettors away from rival operators and build market share. Offering better odds and winnings, matching stakes and reduced commissions for specific events appear to be mostly aimed at stimulating sales through triggering more betting.

A few inducements focused on rewarding past behaviour, such as awards for the most successful multi bet. However, this had the dual purpose of also encouraging continuation of betting by paying the award in bonus bets. Thus, while all inducements aimed to increase sales, they presented customers with a wide array of incentives to overcome psychological, risk or competitive barriers to their purchasing and their future purchasing.

5.2.5 Many inducements are for complex bet types and combined

contingencies

Bet types range from simple win bets placed on match outcomes to highly specific bets on particular in-match events and contingencies (Newall, 2015). Many wagering inducements are for complex bets, which present difficulties for customers in working out the probabilities of winning. For example, estimating the probability of a particular player scoring the first try is a highly complex calculation which would require knowledge of the form of all players on the team and their relative

competitiveness against the opposing team. Some wagering inducements involve combinations of contingencies, such as: if your team leads at half time but then loses; if your team achieves a

minimum specified score but then loses; if you pick the first try-scorer and he goes on to score another try; and if your team wins and your selected player scores. These bets combine two outcomes, which adds further complexity to understanding the true odds of winning and being able to search for the best deal (Newall, 2015). Under conditions of complex probabilities such as these, people tend to rely on heuristics (mental shortcuts) when making decisions and these can be subject to cognitive biases which overestimate the probabilities of winning (Tversky & Kahneman, 1974).

The audit showed that incentivised bets were frequently for complex and combined bets. While these bet types may add excitement and entertainment value for customers, associated inducements can encourage customers towards bets that have higher expected losses. This trend has been found in other research; an analysis of special bets offered by UK bookmakers during the 2014 soccer World Cup found that they almost exclusively advertised complex bet types with high expected losses (Newall, 2015). Further, people tend to overestimate the probability of finely partitioned bets,

suggesting that operators may be able to offer worse odds than the actual probability would suggest and still attract customers (Newall, 2015). Bet types for which inducements were provided in the audit may have a similar tendency.

It was outside the scope of the present study to calculate and compare expected operator margins on different bet types for which inducements were offered, but this would be a useful exercise for future research to see whether incentivised bets have higher, lower or equivalent expected losses compared to non-incentivised bets. Examination of wagering operator data would also be insightful. Gainsbury and Russell (2015) examined a year’s betting data from one Australian wagering operator. Highest losses were for multi bets and exotic bets, where 88.8% and 86.6% of those bets, respectively, were losses compared to 60.4% of place bets and 79.5% of win bets. The authors concluded that exotic bets and multi bets are relatively risky, as they require several predictions to be fulfilled, although, as a result they generally give a larger return if successful. This return may be even higher if accompanied by a monetary incentive; nevertheless, many wagering inducements appear to be for the types of bets that have a comparatively low probability of winning.

5.2.6 Most common types of inducements

Four types of inducements made up nearly two-thirds (64%) of all inducements in the audit. The most prominent were refunds/stake back offers which comprised 27% of all inducements. As noted above, these help to lower perceived risk but also encourage future betting as the refund/stake back is nearly always provided as bonus bets or deposits with play through conditions. This predominance of refunds/stake back offers appears to align with customer preferences. A quasi-experimental study comparing sports bettors’ responses to different marketing message elements (Hing, Vitartas et al., 2014a) found that, of all bet types examined, a bet with a ‘risk-free’ offer elicited most interest, temptation and likelihood of placing the promoted bet. This result was consistent amongst the 200 regular sports bettors, 207 non-regular sports bettors, and 204 non-sports bettors in the study, as well as amongst all PGSI groups.

The three other most common inducement types found in the audit were sign up offers (13% of all inducements), bonus or better odds (13%), and bonus or better winnings (12%). The latter two types of inducement were very similar and the associated bonus was sometimes paid in cash. However, the cash payout or bonus was usually tied to very specific and complex bets which often had combined contingencies, such as picking the first try scorer and that try then being converted. As discussed above, complex and combined contingencies in bets typically have high expected losses (Newall, 2015). Thus, the most prominent inducements in the audit lowered perceived risk, encouraged future betting, aimed to attract new customers, and offered cash and other bonuses on bets with low probabilities of winning. The most prominent inducement also aligned with customer preferences for ‘risk-free’ bets.

5.2.7 Inducements used by new entrants

It is of interest to note that the highest number of inducements in the audit was provided by the newest entrant to the Australian wagering market, Crownbet. This finding suggests that new operators

perceive that inducements are needed to build brand awareness and market share, and that the licensing of additional wagering operators is likely to increase the volume of incentives marketed to bettors. Crownbet’s main type of inducement was the refund/stake back offer which constituted nearly 60% of its inducements offered during the audit period. However, it provided the lowest number of sign up offers amongst all brands, which may reflect its business base in the state of Victoria where these inducements are prohibited. Crownbet was also the most likely amongst all brands to provide

incentives in the form of bonus bets, but the least likely to provide incentives in the form of better odds. As noted above, bonus bets typically have play through conditions, while bonus odds typically

increase the cash payout. Thus, providing incentives that prompt future betting with the operator appears to be considered highly important by a new entrant.

5.2.8 Differences between onshore and offshore inducements

Several differences were observed in the inducements provided by the onshore and offshore

operators. Inducements were more common amongst onshore brands, and the five brands providing the highest share of inducements were all Australian licensed operators. On average, onshore operators had 11.6 inducements, while offshore operators offered an average of 4.1 inducements. This may reflect the highly competitive nature of the industry in Australia, as discussed in Chapter Two, as well as tighter restrictions for other types of advertising. Just as the prohibition of live betting odds promotions during televised sports broadcasts prompted higher expenditure by gambling operators on paid advertising (Schetzer, 2014), this prohibition may have similarly increased the

promotion of wagering inducements on websites and in other digital media, due to the comparatively liberal regulatory environment applying to wagering inducements.

The most common inducements provided by onshore brands were refund/stake back offers which, as noted above, appear to be particularly appealing to Australian sports bettors (Hing, Vitartas et al., 2014a). In contrast, offshore brands promoted a higher proportion of sign up offers, which may reflect the prohibition of these inducements in several Australian jurisdictions. These differences were also reflected in the incentives most commonly offered, with onshore brands most often providing bonus bets/credit, while offshore brands most often provided matching deposits. The average maximum monetary value of the incentive was also higher among offshore brands ($197) compared to onshore brands ($124), which may reflect the more generous and widespread sign up offers being promoted by offshore operators.

Some terms and conditions were more common amongst onshore brands. These included exemption of bonus bets, a specified maximum threshold on the payout, a limit of one incentivised bet per person/account or household, a limit of one incentivised bet per event, and limited to a particular betting medium (predominantly online). Offshore brands were more likely to have a play through requirement and to stipulate multiple play throughs (average 5.8 times), compared to onshore brands that required bonuses to be played through an average of 1.1 times. Thus, onshore operators had more modest and reasonable play through requirements, on average, compared to offshore operators.

5.2.9 Sports betting inducements vs race betting inducements

The majority of inducements in the audit for were for sports betting(50%), while 32% were for race betting, and the remaining 18% applied to both. This pattern was the same for onshore and offshore operators and reflects the global growth potential in the sports betting market, compared to the more mature market for race betting. As discussed in Chapter Two, sports betting represents a lucrative market showing both increased numbers of participants and increased per capita expenditure in recent years (Queensland Government, 2014) with substantial future growth predicted (Morgan Stanley, 2014). Its target market of young adult males of higher socio-economic status, employed full time, better educated and with access to the Internet (Palmer, 2014) is one with disposable income, and operators would be keen to attract and retain them through offering a wide range of attractive inducements to bet. As only about 13% of Australian adults bet on sports, compared to 22% who participate in race betting (Gainsbury, Russell et al., 2015a), significant growth potential remains in the sports betting market.

Some differences were apparent between the types of inducements offered for sports and race betting. Multi bet offers were almost exclusively targeted at sporting events (95%), as were the majority of refund/stake back offers (70%). As noted earlier, these two types of bets appear to be aimed, respectively, at increasing the volume of bets, and lowering perceived risk while encouraging future betting. Multi bets have also been found to have high expected losses (Gainsbury & Russell, 2015). In contrast, payment of winnings on losing bets was more commonly associated with racing events (75%), because of the high number of ‘protest payout’ inducements in this category. The offering of protest payouts also lowers perceived risk of betting for customers.

5.2.10 Complex terms and conditions

All inducements were subject to certain terms and conditions, and their complexity and lack of transparency were key characteristics of the inducements audited. Terms and conditions were often

not contained in the display advertisement itself, but required the customer to click on a link to access them. Inducements were also typically subject to a raft of general terms and conditions which were located elsewhere on the operator’s website. In many cases, it was up to the customer to locate these general terms and conditions, with no direct link provided. The sheer volume of these general terms and conditions (450 pages for one Australian operator) and their legalistic language meant that it was not always obvious, and in some cases exceedingly difficult, to know what restrictions applied to a particular inducement. This hinders transparency and informed choice for customers, as discussed later.

The most commonly applied terms and conditions, applicable to more than half the inducements audited, were restrictions on the use of bonus bets (76% of all inducements), restrictions on the maximum value of the incentive/payout/bonus (60%), limited to recreational gamblers (55%), exclusive to registered members (52%), and subject to a time restriction (48%). Terms and conditions applying to more than one-third (but less than half) of the inducements audited were a limit of one per

person/account or household (40%), limited to one per event (39%), a play through requirement (35%), and limited to a particular betting medium (predominantly online) (35%). Those found in fewer inducements were that they could not be used with any other offers (26%), had minimum and/or maximum value limits on the associated bet (18%), were limited to particular jurisdictions (27%, onshore only audited), and had an explicit requirement for a minimum odds threshold with the associated bet (13%).

Naturally, terms and conditions varied according to inducement type. Of interest is that play through requirements were highest for mobile betting offers (5 times), followed by sign up offers (4.8) and happy hour offers (3.3), although these figures are inflated by the much more stringent play through requirements of the offshore brands compared to the onshore brands audited. The highest average play through requirements for onshore brands were for refer a friend offers (1.3 times), refund/stake back offers (1.2 times) and sign up offers (1.1 times) The potential of play through requirements to intensify betting is discussed later.

5.2.11 Minimal embedded responsible gambling messages

Very few display advertisements for the inducements audited contained an embedded responsible