The torrent of gambling commercials on television and social media, fueled by massive ad spend, is doing well for market leader Sportsbet.
The gambling business has revealed just how much it is spending in Australia on marketing, pushing Same Game Multi and Bet with Mates via campaigns produced by an inhouse creative team, as the movement to ban sports advertising gains traction.
Flutter, the parent company of Sportsbet, says it allocated an additional marketing spend of £10 million (AUD17.5 million) to defend its leadership position in Australia.
The company’s accounts, lodged in the UK, show a total of £64 million (AUD 124 million) spent on marketing in the six months to June, a 23% increase in Australian dollar terms.
Advertising related to sports betting/wagering has been a huge growth category for Australian media companies over the last decade, according to market analysts.
The money from gambling advertising has grown by around 13% compound a year over the last 15 years, hitting $300 million in 2022 from $53 million in 2007.
However, the advertising industry and its agencies are being challenged from within by its own staff who don’t want to work on briefs involving gambling.
And the political climate appears ripe to support a ban, with a federal parliamentary committee recommending a phased ban over three years on advertising urging gamblers to place bets.
The online betting shops, represented by Responsible Wagering Australia, say blanket bans are ineffective to stop problem gamblers who would just turn to illegal offshore markets.
Flutter reported its Sportsbet revenue down 1% to £604 million in Australia for the year to June and sees softer than expected market conditions ahead.
Australian profitability has been dragged down by more challenging COVID-related comparatives and by a changing tax environment.
Victoria plans to increase the state’s point of consumption (POC) betting tax rate to 15% from 10% from July 2024.
Sportsbet says this will add an annualised £27 million (AUD52.5 million) in costs.
“The Australian market is currently undergoing a period of disruption due to POC tax increases and a post-COVID softening of consumer demand, most notably in racing,” Flutter said when announcing results.
“Sportsbet was a disproportionate beneficiary of the COVID tailwinds, and as such, is also being disproportionately adversely impacted from the unwind.
“The softer racing market is expected to continue into H2, resulting in lower market growth expectations, which will impact Sportsbet profitability.
“However, the sports segment of the market has shown continued growth, with Sportsbet’s performance particularly strong helped in part by the evolution of our product, e.g. Same Game Multi.
“Sportsbet has a strong heritage in leveraging its scale and superior product expertise to win in the market.
“This continued in H1 with expansion of our Same Game Multi Tracker product to the NRL and further evolution of social betting product, Bet With Mates, by adding player statistics and chat functionality.”
Sportsbet says it sits in first place with a 48% market share.
And “product provides us with confidence around the future trajectory of our Australian business as it navigates this period of change”.
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