Spotlight Sports Group’s BetTech Ecosystem: Valuable Insights into Global iGaming and Sports Betting
What are the current sports betting trends, and where is the market heading? For the second time, DataArt met with Harry von Behr, US Managing Director at Spotlight Sports Group, to discuss the key findings of the BetTech Ecosystem 2023 Report. The speakers dived into the latest edition of the report, which provides a visual overview of the sports betting technology ecosystem, explains current market trends, and highlights how sportsbooks can leverage users’ data to create messages and content tailored to their needs.
Speakers
Russell Karp, Senior Vice President in the DataArt Media and Entertainment practice, focusing on sports betting.
Harry von Behr, US Managing Director at Spotlight Sports Group. Spotlight Sports Group is a company that seeks to engage with customers, move with the changing needs of sports bettors, and drive the industry forward through innovative product technology. They take every sports betting experience above and beyond — both on their platforms and with their partners. They are market leaders in driving engagement, retention, and conversion of sports bettors and fantasy players.
Kevin Twitchell, advisor in the DataArt Media and Entertainment practice.
Watch the full video or read a shortened text version below.
Russell Karp: We finally have somebody who was willing to come back and talk to us. So, tell us what brings you back.
Harry von Behr: It’s great to be back, firstly. We had a great conversation last time, very interesting, more generally about the role of technology and content and data in the sports betting and gaming space. But this time round there is a reason rather than us just having a nice chat about the same old stuff again. We have published the third version of the BetTech Wheel and BetTech Report. So, I was very keen to come on with you and discuss it a bit around the change in the ecosystem and also some of the trends we’ve seen over the last year.
Russell Karp: So, digging into the new report, can you talk about how the bettech ecosystem has grown since 2022?
Harry von Behr: Yeah, of course. So, we saw a big growth between 2021 and 2022. The most recent 22 to 23 version has again grown. So, we’re about 17% growth in the number of companies, which is obviously a pretty substantial increase. That’s partly helped by the addition of a new segment in the data and clouds portion of the bettech wheel. But what we have seen is a number of new companies added probably less than were previously removed. What was interesting about that is it shows that there’s still a lot of innovation in the space and new companies being set up to compete and also companies entering betting and gaming who previously may have focused on other verticals.
But at the same time, the lower number of removals, probably speaks to the lack of consolidation that’s happening over the last 12 months versus the previous year. So, less M&A in the space and therefore a growing number of companies rather than companies merging together.
Russell Karp: And what are some of the key findings in the report?
Harry von Behr: The report touches on a few different areas. One of the main insights is the difference in the levels of maturity across the East side of the Atlantic. That’s not going to be massive news to anyone. And it’s certainly not rocket science. But I think it’s very interesting to look at the maturity of the European market and how relatively saturated it has become and the regulation that is causing issues for a number of operators and suppliers in the various more mature European markets.
And then, comparing that to the US market that has grown incredibly strongly but is now facing what I personally think is something of an overcorrection. You mentioned operators pulling out of the US, certainly a lot more cost pressures and a focus on profitability there. But it’s still hard to believe that it’s not going to be a massive valuable sports betting and iGaming market at a point in time.
And so, looking at the differences between the more mature and less mature markets is certainly one interesting topic that’s covered across the report. A few others, one that the growth of the number of companies in the BetTech Wheel and BetTech Report highlights is that there’s probably a reversal of the trend that we had seen previously of lots of operators looking to insource all parts of their supply chain, be it from customer acquisition, engagement, retention, monetization, a lot of the back-end technology. And now, almost a reversal of that trend given you’re seeing a lot more focus on profitability and cost pressures than sometimes it makes sense to outsource some of your non-core competencies. So, that’s an interesting topic that’s certainly picked up in parts of the reports and also has been discussed with the various industry experts who have helped pull it together with us. And then the final interesting trend, and it probably again speaks to the growth in the size of the bettech wheel, is the increasing breadth of suppliers and providers that you’re getting in the space and the market in general.
The first version of the report reaches the second and now it reaches the third. It’s amazing how much the wheel has grown in terms of the different segments on it, but also the number of companies in it as well. It’s such a diverse, growing industry, even when faced with economic pressures there are a lot of new interesting businesses that are popping up.
Kevin Twitchell: Yeah, I really enjoyed reading the report and I encourage everyone to read it, will provide a link too, because I like the way you visualized data in your report and showed the trend from the overall market to navigate. And then the whole area of data and content, which is an area we focus in a lot, is we can see this shift on, with media companies, how it went from the platform and how sexy the platform was to audience retention; and now where data and content start becoming king to how you succeed.
So, can you talk a little bit about in the report, that whole section on data and content and what you’re seeing moving forward?
Harry von Behr: Yeah, you’ve summarized it very well as the different types of data. The way we think about it is the data that we use to inform and create content for our end users, whether it’s on our own properties, racing posts, or Pickswise; also, whether it’s on our media partnership properties. We work with a number of publishers, both in the US and internationally, to help them to better engage and unlock value in their audiences.
And then the other component is also the customer data and how that’s used.
And we see in our own Api properties, that the more we understand the customer the better we can serve them the right content, the right messaging, and even tailor and evolve the products to better suit their needs as well. So, the different types of data can create value for us in different ways.
Harry von Behr
US Managing Director at Spotlight Sports Group
But it is really how you harness, how you ingest it, how you store it, and how you actually understand the insight that the data is driving rather than just having a lot of data, it is very rarely, if ever, the answer.
Russell Karp: So, this report obviously takes a lot of work to pull together. As you just mentioned, all the other data points and also the wheel as well, which is an amazing illustration of what’s going on in the industry for me. From your perspective, how does this report play a pivotal role in the gaming industry?
Harry von Behr: If I think back a few years to when we came up with the concepts, there was an interesting conversation amongst a number of us at Spotlight and we realized this was quite a significant gap in the industry and the market. People knew a lot about individual segments, but a lot of that time either existed in people’s brains or on their hard drives.
But there wasn’t a resource that could be used and was readily available to a whole range of different industry participants. And that last bit was the most crucial factor for us, that is useful for everyone, regardless of if you’re an industry observer, if you’re a participant on the operator side. And I go back to the previous conversation, I need a payments provider or I need a live data solution or I need racing commentaries, we’ve got a resource here that gives you readily available at your fingertips, on your desktop or, if you like, maybe the laminated version that you have sitting on your desk.
But the result is that now you’ve got a resource you can go to and find the right supplier. And if you’re in an acquisitive mood and you’re looking to get into a certain segment, you have a ready-made shortlist of companies that are potential acquisition opportunities.
So, regardless of which role you play within the industry, the report plays an important part and the idea is the use of a graphic and making it art with a capital A. Making it as artistic as possible is helpful for that as well because it’s then easily digestible if you need it for any of those reasons.
Harry von Behr
US Managing Director at Spotlight Sports Group
Kevin Twitchell: In the last report, you talked a little bit about Latam. Where is it going? Can you talk about that a little bit? When are the next dates going to come on in the US and then what’s that impact going to be? Or is there going to be a little pause? Are we ever going to see Florida flip or California flip? And then what about Latam?
Harry von Behr: Yeah, well, I certainly don’t want to be making predictions about Florida or California. But, as I mentioned at the start, the US is gone on this rollercoaster journey and we’re in a little bit of a downturn at the moment in terms of the optimism around it. But it’s certainly an overcorrection, anyway my personal view, we’ve just come off the back of successful state launches in Ohio and Massachusetts.
The outlook for the rest of the year and certainly into 2024 is a bit unknown currently. There’s likely to be a small number more but certainly not any of the big states that are going to move the dial from a US perspective. So, it looks like it’ll be more of a drawn-out process in terms of that continued growth from a top nine perspective, certainly in terms of US handle. Internationally, it’s a case of entrusting views where you have increasingly more regulatory scrutiny in Europe and trying to find a way through the different dynamics within each country.
And then the flip side is you have Latam, which is growing significantly, increasing growth just from a general media perspective but also when you overlay sports betting onto that as well. And also, there are various Asian markets as well where people are looking with interest given large significantly improving economic environments, where if they were to regulate, they create similar opportunities to the one we’ve seen in the US over the last five years or so, I’d say. It’s a constantly moving picture, and the key is just staying on top of it, making sure you’ve got real clarity on where the priorities are for you as a business and where you think you can make the most of the opportunities.
Russell Karp: What you have produced is unique in terms of a view of the markets. Can you talk a little bit about what it took to get there? Of course, don’t reveal all your secrets.
Harry von Behr: Yeah, there are no secrets, so there’s no secret sauce. As I have mentioned previously, we recognized it was something that was missing and would be valuable to everyone who sees it or such as the industry in some way. And after that, it was a lot of hard work by various members of the team. So maybe that’s the secret sauce, so it’s not so secret anymore. People putting their heads together, doing desktop research, and speaking to various participants within the industry.
We also have had input from a number of independent betting and gaming experts as well, so it helps. We as a business touch lots of different parts of sportsbooks operators and have a very strong network on the ground so they are able to speak to people on all different sides of the industry. So, that’s how it’s been pulled together.
And as I mentioned, people, when they’re not on the previous version will let us know and therefore that helps to build it out. We continue to speak to the experts within the industry as well to get their counsel in terms of whether there are other segments that are missing or trends that we should cover as part of the report itself or businesses that we’ve missed off as well.
So, it’s an ongoing process and all we’re trying to do is make sure that each version is more useful than the next, as hopefully everyone will find this the third iteration of that valuable.
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By Russell Karp,
Vice President of Media and Entertainment Practice at DataArt
Originally published at https://www.dataart.com.
