Outbreak Marketing

Fast forward to a dystopian future. Society as we understand it has ground to a halt. An infectious disease has surfaced and has forced governments around the world to take drastic action, inflicting massive damage to the economy and imposing unprecedented strictures on the freedoms available to their citizens in a desperate effort to protect lives and minimise the death toll.

6 months ago the above would have seemed like science fiction. This bleak portrait of the future is starting to become a vivid reality. The world has changed radically in a short space of time. Every aspect of our lives and society are now faced with the huge challenge of adapting to our new circumstances. But as daunting as all this is, the iGaming industry is better placed to weather this particular storm than the vast majority of sectors. There is no question that we face challenges as well, but our capacity to work remotely alongside a potential consumer response that could unintentionally increase customer engagement levels, at least in the short term, places iGaming in an near unique position.

And this is where the purpose of this article really starts. It seems near certain that any increase in gaming volume that comes off of the back of lockdown situations that the populations of many countries are now finding themselves in is likely to be fuelled at least in part by vulnerable people engaging in additional risky behaviour due to the lack of other activities available to them.

By and large the industry appears to be recognising this and taking appropriate measures. Over the last couple of weeks at least two of the major regulatory agencies within the industry have issued statements to licensees regarding ‘socially responsible’ advertising practices during the outbreak and we have seen more and more affiliate programs sending out instructions to their affiliate partners not to use the current medical welfare situation in any marketing. Many of these operators proactively took this step before we were aware of any position being taken by the regulators. You will notice that in the writing of this article I am being careful to avoid using certain terms and names to prevent this piece appearing in search engines for those terms specifically to ensure we do not transgress in this manner.

This is an entirely appropriate response from an industry striving to build trust with the consumer market and we applaud those groups that acted quickly to highlight unacceptable practices. No-one should be purposely trying to cash-in on a situation that has already cost tens of thousands of lives and sadly will cost many more. It’s just a shame that anyone even has to say that this was unacceptable in the first place.

But the concern I would like to highlight today is of a slightly different and perhaps less obvious nature. Slapping up pages specifically targeting search traffic related to this issue is not the only action that could be interpreted as cynically exploiting this circumstancec. My fear relates to how gambling companies will engaged in marketing outside of affiliate channels over the duration of this crisis and how the media, regulators and the public will perceive these activities in retrospect. Specifically I’m concerned that it may comes to light that the spend on direct marketing (like TV advertising) by notable groups within the industry will rise significantly over this period.

Let me be clear, we do not have any direct evidence to suggest that this has happened yet. But I would be very surprised if conversations down this line were not to have occurred already.

If operators were to pursue increased marketing activities at this juncture it would be negative for the industry in three substantive manners:

• Social Responsibility – I would be stunned if any operator has not noticed patterns of increased play since lockdowns and social distancing came into place. While some of this will be innocuous and healthy engagement with a form of entertainment, there is no question that a significant portion of this increase will be as a result of isolation and the financial distress being inflicted as many people are faced with reduced incomes. Increasing marketing efforts in the current climate will unquestionable result in a higher than average level of harm to vulnerable parties occurring. When faced with justifying this type of action it would be a tall order to argue that this was anything other than predatory practice. The blowback in the media if this were to come to light could be substantive.
• Regulatory stricture – As a participant in this industry the reputation of the business as a whole is a concern to us. Fines and sanctions being handed out by regulators do not reflect well on the sector. In my opinion, being seen to pursue aggressive marketing practices at this point in time carries significant risk of the one of the involved regulators deeming this to practice to have been inappropriate retrospectively. Given the 8 figure fines that have been seen in the last few years a host of fines of this nature off the back of the current situation is the last possible thing that the industry needs given the already self-evidently hostile media and public perception.

• Affiliate industry relationships – Would anyone think it unjustified if, in the light of increased direct marketing spend by operators, affiliates viewed this practice as entirely hypocritical? On the one had operators are ensuring affiliates comply with socially responsible practice by threatening termination of contract for any infractions or attempts to ‘cash-in’ off of the current situation. If it were to come to light that some operators has looked to exploit exactly the same increased consumer engagement that they warned their affiliate partners off of via other marketing channels, the already strained operator/affiliate relationship could take yet another blow.

It is our genuine hope that the major players in the industry will be smarter than to fall into this trap. But as can happen in any large organisation, if the left hand doesn’t talk to the right hand, the mixed objectives of different departments could result in undesirable end results. That is why we would encourage those individuals working with a Responsible Gambling remit to speak to their marketing departments. Have this discussion internally. Our advice would be to ensure that if your marketing spend does increase over this period, that the year on year increase for the quarter does not exceed the year on year quarter increases seen in previous years. But for greatest brand protection, simple limit the quarter’s marketing spend to the same amount spent last year. This heads off any possible accusation of exploiting the situation for commercial advantage.

To all reading this – please stay safe and health. The best wishes of ThePOGG go out to all in this challenging time.

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