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Mobile App Wagering Booms Across Australia at Expense of Retail

Thu, Aug 10, 9:06am by Staff Writer

Per the latest findings from Matt Ryan, a veteran gaming industry analyst working for the UBS investment bank, sports bettors in Australia are increasingly replacing retail outlets with mobile apps.

A report published last week by The Australian detailed Ryan’s appraisal of the sports betting industry, which he says managed to grow digital wagering turnover by 23 percent during the first six months of 2017. According to Ryan, mobile apps and online platforms are now used to place more than 66 percent of Australia’s total wagering volume – a first for the digital sector.

And as Ryan found, the rise of online adoption among sports bettors corresponds with a contraction in the land-based retail market:

“The structural shift in betting continues with retail turnover declining 6 per cent in the first half of 2017.”

Ryan’s data also illustrated a steady trendline among the four major international providers, as Bet365, Ladbrokes, SportsBet, and William Hill comprised 64 percent of mobile sports betting app downloads. That figure remained flat when compared to the first half of 2016, as Ryan noted in his analysis:

“This supports the notion that while app download share has fluctuated between the operators, total international bookmaker download share has remained relatively stable over the past few years.”

Of the four leading providers, Sportsbet dominates the app download sector with 33 percent market share. Melbourne-based Tabcorp generated 18 percent of mobile sports betting downloads, good for a slight 2 percent increase over the same period last year.

Ryan tabbed Tabcorp for future growth based on the most recent data:

“This reflects a turnaround in digital share for Tabcorp after declining by 4 per cent in 2016.

The improvement in Tabcorp’s app download share supports our forecast of around 15 per cent digital wagering growth in 2018.”

U.K.-based operator William Hill has experienced both sides of the shift from retail to digital, as online wagers now represent nearly 35 percent of the company’s revenue.

Within the first-half financials released by William Hill last week, the company reported that 81 percent of its online betting activity was conducted via mobile app – up from 70 percent year-on-year. Confined to the digital space, William Hill posted adjusted operating profits of £57.2 million, up 32 percent year-on-year, while total wagering activity rose by the 11 percent rate to £2.49 billion.

This growth coincided with a dip in profits from the William Hill retail division, which recorded net revenue of £460.1 million for a 2 percent dip, and adjusted operating profit of £80.9 million – down 14 percent.

Newly named chief financial officer Phillip Bowcock issued a statement addressing the retail-to-digital transition, both in Australia and abroad:

“The first half of 2017 has seen good progress against our three strategic priorities and wagering growth across all four divisions.

Our product improvements combined with improved marketing have seen both existing customers respond positively and the number of new customers start growing again during the period.

As a result, we are seeing good momentum building in Online’s performance. In Retail, we made market share gains, with growth in both sports betting, despite the lack of a major international football tournament, and gaming revenues.”

Limiting the scope to Australia, William Hill grew its wagering turnover by 28 percent, despite the decrease in volume precipitated by the Northern Territory’s ban on “in-play” betting.

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