Cultivating customer loyalty has long been considered key to betting shop profitability. However, the data shows there’s more to the story.
Using a recent study from the Competition & Markets Authority, we have set out to find out whether location could actually be a more potent factor than loyalty.
What role does loyalty play in betting shop profitability?
Loyalty undoubtedly plays a significant role; three quarters of betting shop customers visit their preferred shop at least once per week.
This loyalty often comes at the expense of company margins, however. With respondents stating odds as a key reason for choosing a preferred betting shop, assuring loyalty may involve offering:
- Low-margin odds
- Regular promotions
- Free bets
- Reload bonuses
- Cash offers
Respondents were also asked how they would react if their preferred betting shop closed for refurbishment for six months.
77% of respondents would go to another betting shop, and only around 35% of this figure would consciously choose a betting shop run by the same company.
What location factors affect betting shop profitability?
With loyalty at best partially responsible for betting shop profitability, here is an overview of key location factors and their respective effects:
1) Proximity to customers
Convenience was cited as the most important factor for customers when choosing which betting shop to visit.
65% of those surveyed had come from home, while 26% had come directly from their workplace. In both instances, the place they had traveled from was also within the immediate locality.
With Periscope®, you can plot the home and work locations of regular, irregular and prospective customers to identify the most convenient locations.
You can then integrate census and sales data to plot average income/education levels within a defined area, and analyze social media sentiment to predict which sports/events are likely to be most popular.
Using this insight, you can adapt your betting shop design and services to suit local tastes.
2) Local businesses/amenities
61.5% of respondents stated their visit was not the main reason for their trip. A significant proportion specifically cited the presence of other shops and easy access as vital.
Nearby pubs broadcasting relevant sporting events can also be a key asset. You should promote odds for events being broadcast locally in your shop window, and set up relevant in-play betting options.
Periscope® enables you to log competitors and complementary businesses on your own secure, corporate version of Google Maps. You can even ascertain how your betting shop would fit with the local aesthetic.
Though not covered by this study, your approach to marketing and advertising can also have a major effect on betting shop profitability.
Location intelligence gives you two key advantages in this area. You can gain the local customer insight needed to:
- Tailor your marketing messages to appeal to local demographics
- Situate advertisements/marketing resources in effective locations
Use Periscope® to conveniently adopt this two-pronged approach, maximise your marketing ROI and incentivise customers to travel to your shop – even over a more conveniently-located competitor.
Loyalty is undoubtedly an important part of assuring betting shop profitability. However, for all these reasons and more, location is the key aspect you should be considering.
Generate the in-depth insights you need to optimise your betting shop locations with Periscope®. Request a 10-minute demo today.