Revealed: online gambling operators use AI to optimise their products
16 July 2018
A few months ago, The Guardian published an ‘inside knowledge’ article that scrutinises the online gambling industry for using AI and analytics to ‘keep gamblers hooked’. Despite the effort of the industry to clean up its image with various initiatives, this negative portrayal is not helping, nor is it showing what happens in the backend. Many don’t view the gambling industry as a business in positive light at all and only focus on the negatives. What if we told you that online gambling is using modern tech like any other industry to improve their services and provide a better customer experience.
While a lot of operators still use legacy systems that run their products, they’ve also been implementing more recent technology to modernise their business and catch up with the rest. Let’s see why they use AI and data analytics, and what they do with it.
User acquisition costs are very high and it gets really competitive, as customers chase offers instead of staying loyal to a particular brand. There are new deals nearly every day aimed at attracting new ones. However, it is even harder to retain them because of this, so operators need to be smarter about their tactics. One way of keeping their customers is providing a great gaming experience on their products.
User experience is one of the factors and really helps to draw customers in. You wouldn’t put much trust into a website that isn’t optimised for mobile, takes a while to load or has too many steps in the user journey. For example, betting is instant and the website or app needs to react quickly to provide a great betting experience.
It’s true that analytics helps to monitor every step gamblers take, where they click, at what time etc. This information helps to build a better picture of how they interact with the product, where drop offs happen, which obstacles they experience and also what works. If the operator sees a significant amount of page abandonment at one point, it flags that there’s clearly an issue and it needs addressing. This is how they can improve their products and make the customer journey smoother.
This is why companies like Amazon and Asos do so well - their UX is simple and efficient, which means it’s pleasant to use and encourages customers to return. The Guardian also measures its readership, which it then offers to advertisers. Note that there are strong analytics behind these companies to constantly review and update the products to make them seamless, and they want customers to continue spending with them.
Personalisation is a common practice among many industries and we can see how it’s used in retail, travel, finance and others. So this shouldn’t come as a surprise that gambling operators are doing the same to help their customers find relevant content and games. For example, they can display content based on customer’s bet or game history to appear whenever they log in. They also send push notifications to phones around the matches whenever a customer’s favourite team is playing. The system also promotes similar games that they can try to differentiate their experience. This helps to keep them engaged and offers a chance not to miss out on a bet/new product. These can always be switched off if they become too annoying or frequent and the customer is always in control of how personalised these things can be. There are now stricter rules around compliance and GDPR, so marketing can be toned down a lot, provided customers manage these channels and operators adhere to their requests.
Let’s take a look at Netflix and Spotify. Both offer lots of content which is mostly served based on user preferences to provide a more tailored experience, enabling customers to watch or listen to something to their taste. Both have lots of analytics and data behind them which allows these companies to create such varied and personalised content. They’re extremely popular and have overtaken other channels in their fields. The term ‘binge-watching’ came after Netflix released entire seasons of their most popular TV shows, which allowed people to watch them without interruption or having to wait for the next week’s episode. We don’t demonise them for doing this, so why should gaming be scrutinised so much? In fact, we advise gaming companies to follow their lead to create similar user experiences for betting and gaming.
Tackling Fraud and Problem Behaviour
One of the key reasons there are different algorithms and data analytics in the backend of online gambling systems is to tackle suspicious and problem behaviour. The fines are hefty so operators really need to monitor this to prevent or stop this when anything occurs. Big Data can be used to learn customer behaviour patterns to alert administrators when any unusual activity occurs, such as increased spend or frequency. The accounts can be frozen and any fraudulent transactions stopped. There are, of course, extreme cases when the system fails to notify operators, and unfortunately some slip through. It’s important to continue improving this and implementing more advanced monitoring systems to reduce this risk.
The online gambling industry is a business like any other that offers fun and engaging services to sports and gaming fans alike. The UK gambling industry is one of the most regulated in the world and there are lots of different schemes in place to protect consumers and children. Operators need to be part of various initiatives to reduce problem gambling. One of the most recent ones is GAMSTOP, which enables individuals to self-exclude from gambling across all operators. Nobody wants to make their customers bankrupt, but retain them and offer a great gaming and betting experience.
Modern technology simply helps operators monitor this and minimise risks, just like any other business. There is some serious technology behind creating online gambling products and it takes a lot of skill and expertise to implement everything. Hopefully, through the effort of modernising its products and image, more people will start viewing it as a regular business that offers lots of fun and engagement to its customers.