Responsible Gambling Strategy for Sports Betting Companies

Embedding Responsible Gaming (RG) into a company’s culture and building this competency internally is not just a regulatory necessity but a cornerstone of sustainable business practice in the gambling industry. This foundational approach ensures that every stakeholder, from employees to executives, prioritizes the well-being and safety of customers, fostering a healthier gaming environment and reinforcing trust and credibility among regulators, investors, and the public. It’s against this backdrop of ethical commitment and proactive stewardship that a robust RG program is structured. Such a program can be envisioned as a pyramid, composed of five critical layers that collectively represent a comprehensive strategy for responsible gaming. These layers begin with foundational compliance, extend through natural extensions of compliance, the establishment of a dedicated RG task force, the testing of new RG programs, and culminate in field leadership. Each layer builds upon the last, creating a holistic framework that not only meets regulatory requirements but also champions the welfare of the gaming community and sets new industry standards.

5 Critical Layers That Together Represent a Comprehensive Strategy for Responsible Gaming

This foundational level of Responsible Gambling strategy involves adhering to all legal requirements in the jurisdictions where the company operates. It represents the minimum standard for RG programs within the gambling industry, focusing on the essential aspect of legal compliance.

Operators who persist at a bare minimum are not as ready as counterparts who attempt to get ahead of forthcoming changes to legislation. Consequently, they are not prepared to quickly pivot as needed, and potentially open up themselves up to liability risk.

At this stage, initiatives go beyond basic compliance, extending logical practices across various aspects of the business. For example, if regulations restrict TV advertising during children’s viewing times, similar restrictions are voluntarily applied to radio, billboards, online platforms, and affiliate marketing. This proactive approach demonstrates a commitment to RG that surpasses just meeting legal requirements.

To ensure a deep and broad application of RG principles, establishing a dedicated RG task force or department becomes the next critical step. This group is tasked with:

  • Integrating RG principles across all levels of the organization, including compliance, legal, marketing, and operations.
  • Acting as the central point for RG initiatives, ensuring that policies and practices are consistently applied and updated according to best practices.
  • Collaborating with external partners for the development and testing of new RG and PG programs, facilitating innovation in RG strategies.
  • Providing regular updates to the board and key stakeholders, ensuring RG remains a strategic priority and is aligned with the company’s values and objectives.

This layer involves the development and testing of innovative RG and PG initiatives in partnership with external entities like state agencies, non-profit organizations, financial institutions, educational institutions, and even software-as-a-service (SaaS) providers. Rigorous testing and transparent sharing of results are essential before broad implementation, contributing to the advancement of RG practices industry wide.

This is where things get deep.

A recent 60-Minutes exposé called into question the effectiveness of the American Gambling Associations’ RG policy as it pertains to online sports betting. It’s hard to argue that the current centralized collection of statutes and regulations can keep up with the brushfire that is sports betting in the USA. If it were, problem gambling helpline calls would not be growing at a record pace around the country.

Some operators are content to hold the line until the federal government steps in to enforce more rigorous protections for vulnerable segments of society. Others, who can see the forest for the trees, understand that the time to adjust their own Responsible Gambling strategy is now. These operators know that doing so works to protect public health, improve their public relations, and get ahead of more stringent regulations to come. It also becomes a competitive advantage. Below is a breakdown of four methods that should be adopted by responsible sports betting operators.

4 Ways Sports Betting Operators Can Build a More Authentic Responsible Gambling Strategy

i. Invest in Better Monitoring Tools

For an operator’s Responsible Gambling strategy to keep up with digital transformation and the proliferation of iGaming, it also needs to leverage technology to protect vulnerable players. Most are already using artificial intelligence (AI) and machine learning, internally or through third party providers, in player retention strategies. By entering into key partnerships, responsible gambling operators can integrate advanced AI solutions to track, score, and flag players who exhibit signs of problematic gambling behavior. Learn more about the potential for digital integration services to protect players.

ii. Work with Financial Institutions

There is an increased call for America’s banks to take a more proactive role to protect their customers (some of which are problem gamblers). This point in time presents an opportunity for gambling operators to partner with financial institutions to identify at-risk individuals and open the gateway for healthy intervention.

The thing that makes this so important for operators, is the fact that problem gamblers generally have multiple betting accounts with different online gaming companies. This makes it difficult to identify concerning behavior, as deposit volume and wagering frequency may seem within the range of normal. By partnering with financial institutions (banks and credit card providers) gambling companies can build a more holistic view of a player and together identify when customers (who have opted in and provided consent) have exceeded limits. Financial institutions and gambling operators are consumer data mining companies by default. Using the data to support the mental/behavioral health of players and not just to create marketing campaigns just makes good sense. In the UK, the open banking concept is working on solutions of this nature:

“One open banking third party provider (TPP) which operates in this space has also developed a pilot platform which can tackle ‘multi-operator problem gamblers’ whereby customers regularly use accounts across several operators – giving gambling companies an earlier and more effective opportunity to build a comprehensive view of the customer’s accounts and offer pastoral support earlier in the gaming journey.”
iii. Make Responsibility a Part of Advertising Strategy

America’s longest running late-night sketch comedy show, Saturday Night Live (SNL), recently put the sports betting industry on blast by parodying marketing tactics used by operators. It’s poor advertising regulation that is fueling much the sports betting crisis in America, so this is where operators who are authentic in their mission to update their Responsible Gambling strategy can make an immediate difference.

Responsible operators can shift marketing practices away from the tactics that target vulnerable young adults and youth. They can remove not-so-subtle inferences that sports betting can help attain wealth, virility, and prestige, and make it more about what it can be for healthy individuals – entertainment and fandom.

A Responsible Gambling strategy’s take on marketing communications needn’t attempt to distract from the potential for harm to vulnerable segments. Instead, operators can address it in an open forum while showing that in the course of doing business, they are doing their part to mitigate risk. They can take a page from brands in other industries. For instance, if an eco-responsible apparel company really wanted to have zero impact on the environment, they would make nothing at all. But of course, that allows other companies to continue operating as is, giving consumers no preferred (for the environment) alternative. Would it not be better for the eco-responsible apparel company to therefore run a business and provide consumers with the healthier option? This is exactly what Patagonia has done, and what is behind the genius of their marketing strategy. Patagonia isn’t net zero (yet) but they have provided consumers a way to reduce their carbon footprint. This may not be a perfect analogy, but a gambling operator can take a stance, and this stance can be a very effective marketing campaign in itself.

iv. Fund Problem Gambling Research

Operators should fund causes that support problem gambling research. Not only can this be leveraged in the above-detailed marketing shift, it can provide valuable insight into vulnerable populations. This intel helps operators delineate between healthy consumer bases to market to, and those who are threatened. The Kindbridge Research Institute offers all types of organizations (operators included) an opportunity to support research programs.

The pinnacle of the pyramid is where the company takes on a leadership role in promoting RG within the industry. By setting high standards and advocating for these practices across the sector, the company not only demonstrates its commitment to RG but also encourages others to elevate their RG efforts.

This approach places a significant emphasis on internal capability building through the creation of an RG task force or department, ensuring that RG principles are embedded in the company’s culture and operations. This strategic positioning allows for a more cohesive and proactive RG program, setting a new standard for responsibility in the gambling industry.

Partnering with problem gambling support providers is a critical component of this final layer. Responsible operators must partner with mental/behavioral health providers who specialize (vs general practitioners) in the treatment of gambling disorder. Custom programs can be created that funnel vulnerable players from a member base and into a resource center that provides them with access to counseling and therapy. This is already happening, as DraftKings (view here), BetMGM (view here), and FanDuel (view here) have joined forces with Kindbridge Behavioral Health to provide greater access online counseling for problem gamblers in select states.

Make Problem Gambling Support a Part of Your Responsible Gambling Strategy

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