Collaboration is Key
Online sports betting brands looking to enter the market for the first time typically face a chicken and egg situation when it comes to deciding who they should use to power their sites.
They can either go with a market leading suite of products from a single provider with overall higher running costs, or they can go with a less expensive option that does not really meet their needs.
The main problem with the former is that as a new business, they are unlikely to have the sufficient capital to swallow the high running costs for long.
The obvious issue with the latter is that ultimately the player loses out in their overall experience and will simply switch to online sportsbooks that deliver what they need and expect. Either way, a new sportsbook brand may very well find itself on the side lines in a matter of months and the game is over before it’s even begun.
The reason for the status quo comes down to a lack of collaboration among suppliers and a desire to be a one stop shop for operators.
For years now, suppliers have been trying to offer operators all the products and services they could possibly need instead of focusing on one or two and perfecting them.
This means suppliers inevitably spread their resources thin in an attempt to keep up with the client, often sacrificing the quality of products and services offered in favour of the quantity.
It is completely understandable that suppliers do this. They want to have as many revenue streams as possible, but this comes at the price of not being able to provide operators with products and services they are even close to being happy with.
A small number of providers are able to do this, but as mentioned above the costs and fees associated with using their technologies can often be astronomical in nature.
What if suppliers were to accept their limitations and collaborate?
They could come together to offer a world-class proposition to operators for a non-prohibitive price.
The lack of collaboration at present is because suppliers are unwilling to admit they can’t do everything to the standard required and from an unfounded fear of losing clients
Of course, it can be hard to face facts and accept that as a supplier you cannot do everything, but the current mindset is harming operators and, most importantly, it is consumers and players who are losing out.
At present, it means that operators (and especially new sportsbook brands) can’t be competitive when it comes to features and this means the player suffers.
Some brands compensate for this by ramping up marketing efforts, but this only serves to decrease profits and expose them to potential losses.
Ultimately, what is the point in acquiring players at significant cost if you are not able to offer them the experience they expect and/or can receive a better experience elsewhere.
I think there is a desire among some suppliers to collaborate and work more closely together, but the issue of mutual understanding and commercial terms remain a significant barrier.
In some cases, providers just refuse to understand that both parties involved in a collaborative agreement have to be happy with the terms and also be fairly compensated.
A lesser hurdle is also the different technologies used by different parties and bringing them together as one. But just like commercial terms, this can be overcome with the right approach.
Successful collaboration will only come from suppliers entering an open and honest conversation about what products/services/skills they lack and what the other party can bring to the table.
Suppliers must be willing to see the other side’s point of view, and they must also be willing to consider commercial terms that satisfy both parties.
The reality is that there is no blueprint for successful collaboration, but a joint understanding and acceptance that they best way for any business to thrive is to have happy clients is absolutely key.
In order to have happy clients, you need to offer them the best solution no matter if elements of the solution are yours or not.
The suppliers that understand this and embrace collaboration will be able to offer their partners the best products and services and help new brands to make their name in a highly competitive sector.
They too will emerge as the go-to providers which in turn will allow them to drive their business forwards and enjoy healthy growth and long-term success.
And all it takes is a willingness to accept that they can’t be the best at everything but by working with others they can offer the absolute best products and services in the market.
Let us instead focus on the end user –and ensure that they are the winners!