Putting a sound ‘Sports Betting Business Plan’ Together!
Nowadays the relatively lucrative world of Sports Betting is within reach of most people. It no longer takes millions in capital or expensive technology. The odds can be streamed from a 3rd party provider and the software for the online platform can be licensed.
You may already have experience of the industry, but if not, a good place to start is back to front from the punter. Here is a good article by Sam Allcock on what makes a good professional punter, so you can understand things from the customer perspective.
We look at what steps could make the difference between a flop and a successful business.
Any business needs to start with a clear plan that all stakeholders can use to visualise the business scope and how it will make a return. The bank will require some business plan before it will extend any loan or line of credit to you, and any investor will need the same.
Use a Sports Betting Platform Provider
The platform that you will host your betting platform on is pretty key. There are many 3rd party providers out there that can white-label your site so it is branded as your new company.
Most are efficient, user and mobile-friendly and offer a good selection of payment options so your customers can use their local currency, credit cards and even cryptocurrencies. For a range of providers, see this selection.
Get Yourself a Gambling License
You don’t want to be operating under the radar and be at risk of being shut down by the gambling authorities. In the UK, the Gambling Commission is very tough on illegal sites and even licensed sites that are not operating ethically or doing full compliance with their betting customers.
Gambling in the UK is a major business, and the Government receives plentiful tax revenues from it. So, essentially, they are gambling-friendly, but they do and will flex their muscles when it comes to black-market gambling or nefarious operators.
Building A Team
This step is crucial because getting the right people on the bus is crucial. You will need someone with commercial knowledge of the industry to negotiate or at least approve the contracts with the software company and 3rd party vendors. You will need an IT manager or at least someone tech-savvy to deal with website or integration issues.
The software provider will maintain most things on your site, but as with any online business, there is still a need to administer domains, servers, virus software, customer databases and emails.
Finance guy is important to look after accounts but also manages all the payment gateways and customer KYC checks. As you can see, this is not possible for a single person, no matter how good their knowledge of the market is. You need a team around you, so you can delegate work that is their speciality.
Sports Betting Bonus Offers
One of the most important factors to consider is how to include free bets and bonus offers for new members. There are free bet offers available at most sports books that are either part of a no deposit sign-up bonus and extra free bets for members that make their first deposit. Examples from websites such as freebets.com show free bets from sportsbooks that offer deals such as £10 deposit for a £30 free bet at minimum odds of 1.5 to 1. There is a lot of competition when it comes to offering free bet bonus deals, but it is something every sports bookie will need to attract new players!
Marketing Your New Site
A department and role not mentioned above is the marketing responsibility
The marketing is key and must make the best use of the available budget to get customers. Now we would hope you already have a database of potential customers you can target with emails and direct mail.
But what we call customer acquisition is vital and the cost of this acquisition. If we know an average customer can bring in revenues of £300, then we can spend up to that in advertising to get each new customer. Anything more than that and we won’t be profitable.
So, any ads that you do use, Google, Facebook, YouTube, messenger ads must get you a conversion for every £300 of ad spend.
The visitors that you bring to your website or sign-up page must be good quality converting traffic. If it’s just traffic that bounces or never converts to a sign-up, you will just be wasting your marketing pounds.
Test and measure the campaigns, and for ones that work scale up the ad spend. Also, Facebook allows you to duplicate audience lists based on current customers with the assumption that profiles like your existing customers are more likely to sign-up too.
Use affiliates that can target their own networks and do the marketing for you, for a fixed percentage commission. Try to only work with affiliates that are paid on conversion and not clicks. Provide customers with referral incentives to get the message out to their friends and family and give strong sign up bonuses that attract new customers as soon as they land on your site.