Over the past few years, there has been a steady increase in esports popularity and that shows no sign of slowing down. In fact, market insights suggest that the global esports market is expected to generate US$35.56bn by 2031 which is a huge increase from the $9.749bn achieved in 2021.
With numbers like this, the potential of esports as a betting product simply cannot be ignored. The major issue the sector faces, however, is that gambling operators are yet to find a way to successfully expand their offerings with esports.
Many big-name operators do, in fact, offer esports line. But when you compare the availability of products such as in-play, personalised markets and even bet builders, or lack thereof, it could be argued that esports takes a backseat for many sportsbooks.
Alex argues there may be a multitude of reasons for this. For him, esports is an industry which is primed for the development of new technologies and, from a gambling perspective, can be the key to reaching new demographics.
He explains, “The esports industry constantly develops and attracts attention with diverse innovations and opportunities. Moreover, with established games holding leadership positions in various regions, there is also a noticeable interest in competitive features of games such as MLBB, PUBG mobile, and Call of Duty.”
“This trend indicates a broader and inclusive growth in the esports industry, emphasising a rising interest beyond top esports titles.”
“Esports is taking on the constantly improving technologies in many spheres, thus increasing the quality and quantity of the delivered content. Streaming and casting production technologies have drastically improved, facilitating faster and more efficient stream delivery, ultimately enhancing the viewer experience.”
Titles such as Counter-Strike 2, Alex explains, are a testament to the innovations that are taking the esports space by storm; game developers have effectively used new opportunities to expand their creativity and, as a result, have produced a more realistic in-game environment.
This hasn’t been the only upgrade to titles. In fact, many game developers have kept a close eye on player trends to stay one step ahead of the curve — this has been particularly evidenced in the shift towards mobile play.
“We’re mainly used to the pro scene using desktops in sports like League of Legends, Counter-Strike 2, Dota 2, and Valorant. Still, device development has skewed from a traditional reliance on desktops in esports to advancements in both game development and mobile technology,” Alex continues.
“In 2023, the notable growth in viewership for games such as Mobile Legends: Bang Bang and PUBG Mobile, along with the Brawl Stars World Finals, that has gotten great attention at winter DreamHack 2023, underscores the industry’s adaptability to emerging technology trends, expanding its reach beyond desktops.”
Recognising the hurdles in creating an esports strategy
With new opportunities for innovation, esports seems like an obvious choice for betting operators looking to diversify their portfolio. But creating a solid esports offering requires careful thought.
Alex warns that there are a number of hurdles that operators will face. The first is that esports requires an entirely different approach to more ‘traditional’ sports; you cannot expect your marketing strategy for football markets to work for esports.
“Very often, bookmakers either do not understand the needs of their target audience or cannot correctly communicate the values of the product and positioning. This misalignment is observed when operators heavily invest in esports, only to find that their audience prefers classic sports, leading to incorrect product fit, leaving gamblers discontented and negatively impacting operator profits.”
Enhanced risk management practises
As with any sport, operators must also take a close look at their risk management practices and ensure that these are above par. The unique nature of esports means that operators must fully understand the intricacies of the sector, the demographics of players and how to adapt risk management operations accordingly.
A solid trading team, consisting of traders, risk managers, controllers and supervisors is – as Alex notes – absolutely necessary for any operator looking to gain a competitive edge by giving them the chance to go above and beyond monitoring the quality of odds.
“The risk management team needs to understand esports and its audience to adapt appropriately, since inadequate and suspicious player activity leads to higher risks of lowering profitability .”
Monitoring player behaviour
One way in which operators can streamline the risk management process is by incorporating technologies such as artificial intelligence (AI). “While AI is not yet on the level where it can “feel” pro players getting sweaty because they are nervous, and the possibility of mistakes grows, a skilled trading team excels in this aspect.
“Traders’ ability to understand the nuances of player behaviour and game dynamics enhances decision-making, ultimately providing a competitive advantage in the dynamic esports environment and contributing significantly to the operator’s overall success.
“Risk managers are crucial in the trading team since they analyse players, impose necessary limits, assess profitability, and prioritise minimising risks. Supervisors ensure transparency, accessibility, and a rich content environment.
“Additionally, specialists in bet control meticulously monitor incoming bets, track potential fraud, and collaborate with risk managers to maintain a secure and trustworthy betting environment. The synergy within the trading team contributes to the holistic success of the esports betting operation.”
Often, a lack of understanding of factors, such as player behaviours, by the trading department, and in fact the wider operator team, can result in a mismatch between the product offered and the preferences of its target audience – “Very often, bookmakers either do not understand the needs of their target audience or cannot correctly communicate the values of the product and positioning.
“This misalignment is observed when operators heavily invest in esports, only to find that their audience prefers classic sports, leading to incorrect product fit, leaving gamblers discontented and negatively impacting operator profits.
“In navigating these challenges, operators in the esports betting industry must choose data providers who prioritise data quality, implement tailored risk management strategies, and have a deep understanding of their target audience to ensure a successful and profitable venture.”
Making the most of high-quality data
But the biggest hurdle, in Alex’s opinion, lies with the availability of quality data. Esports is in a difficult position in that there is a large volume of data that can be accessed by operators, but not all of this information is useful.
Using poor-quality data can lead to long term problems. “A primary challenge lies in the realm of data quality, where interruptions, parsing issues, and poor monitoring create a breeding ground for fraudulent bets,” he says.
“That leads to not only losses for bookmakers but also contributes to an increase in negative experience, which can be caused by such factors as refunded bets, consequently lowering Daily Active Users (DAU) and Monthly Active Users (MAU), decreasing volume and profits.”
Building a sustainable product
Within the conversations surrounding the growth of esports has been the topic of licensed content, and more particularly, why operators should steer well clear of unofficial data.
Licensed content, Alex explains, allows operators to build a more sustainable betting product and minimise the number of integrity threats, thereby creating more trust within your platform.
From an operator perspective, licensed content also means that you gain access to “the fullest coverage with maximum data points”, giving sportsbooks the chance to optimise data analysis and decision-making processes. Ultimately this will provide a better overall experience for players.
He continues, “Licensed content enables bookmakers to provide information with minimal bet disruption, mitigating operators’ losses and users’ refunds. As a whole, this impacts user retention rates and contributes to the overall operators’ profit.
“Furthermore, timeliness and comprehensiveness that are possessed by licensed content empower DATA.BET’s feed by minimising any possible risks and by allowing the building of an extensive and detailed betting solution with various personalised offerings. That is what users can experience with our unique feature called ‘Player Props’, where they can bet on different activities, up to the total kills or deaths of a particular player.”
Licensed content isn’t the only way that DATA.BET is helping its operator partners to increase their bottom-line figures.
With Single Page Application (SPA), Odds Feed, Live Score Feed and Risk Management all featuring in DATA.BET’s roster, Alex is confident that the data provider has just what it takes to create the most comprehensive esports product on the market.
“We deliver high-quality feeds and an embedded solution, ensuring precise and reliable betting experiences. To enable operators to make informed decisions, we provide advanced Risk Management that directly influences turnover through effective risk reduction.”
“Our innovative Managed Trading Services (MTS) analyses players’ gaming activity to determine the acceptability of bets and ensures a secure betting environment for operators.”
“Additionally, MTS collects valuable information about the number of bets for our artificial intelligence model, allowing us to adapt and customise the betting line in real time, granting operators the flexibility to cater to evolving user preferences. Ultimately, this results in increased bets and enhanced income for the operator.”
Data is king – DATA.BET’s four factors in esports success
When data is a core component to the success of a product, partnering with the right data provider is of the utmost importance. This is where DATA.BET really shines.
DATA.BET has firmly established itself as a leading force within the esports data space. And we can see why, namely the number of solutions under its belt, not to mention top-tier partners such as GRID and Bayes Esports.
But when quizzed on how DATA.BET has risen through the ranks of the esports sector, to attain a prominent position among esports data providers, Alex believes that there are four contributing factors to consider. The first factor, he says, is to align with a company strategy that is centred around innovation, growing a market share and establishing a brand voice. With the right team behind you, this goal is “fundamental for success”.
The second factor is the people involved. “Hiring the best talent is equally crucial, which is essential for leading and innovating in the market. It doesn’t matter if it’s the sales or data science teams. ”
An in-depth knowledge of your market, partners, bettors and competitors is the third ingredient for success as a data provider. This allows you to make predictions on future changes to the industry and adapt your products accordingly.
The fourth consideration that needs to be made involves a deeper collaboration between operators and suppliers.
“You also need to listen to operators. They are much closer to the product than anyone else, creating and delivering it to the final user (gambler). They know their stuff. Finally, utilise internal knowledge,” Alex adds.
“Engaging with development teams, who possess comprehensive knowledge of technical capabilities and underutilised data, provides a basis for innovative decisions and product features.”
DATA.BET has used this four-pronged approach to carve out its position as a market leader. Ensuring a proactive approach to market demands and changes in technology propels DATA.BET ahead of the crowd.
Working proactively, not reactively
By avoiding reactive decisions, and instead making those which will place DATA.BET one step ahead of any industry changes, the company has been able to forge stronger relationships with its partners, but also remain abreast of the changing dynamics within the esports sector.
“This multifaceted approach ensures a deep understanding of emerging shifts in both market demands and technology, enabling swift and effective responses.
“One of the key factors that helps us accurately predict market trends and expectations is the availability of internal information from the market itself. With a considerable volume of bets, we monitor and analyse them in real-time, allowing us to adapt quickly to changes, observe users’ discipline choices, and much more.”
Tracking market trends and meeting player demands
Among the biggest market trends that DATA.BET has noticed over the course of the last few years is the demand for diversity in terms of the titles that players are interested in. Offering just CS:GO and Dota is no longer sufficient, players are actively demanding more.
To meet that demand, DATA.BET offers coverage of more than 30 popular esports disciplines, including popular titles such as CS:GO, Dota 2 and League of Legends as well as Valorant, Dota Autochess and more.
Having such a wide array of titles benefits the end player, as well as operators, offering them more opportunities to maximise both turnover and profits.
Alex did emphasise that wider coverage shouldn’t just include more titles, but rather the features and betting products available for each esports game too. “Having more disciplines means including more events in the line, ensuring 24/7 coverage and constant content availability. Consequently, a wide range of esports and tournaments, not bound by seasonality, offer players the flexibility to place bets at any time.
“It’s precisely this freedom and variety of content that keeps them engaged on operators’ websites. For operators, diversity greatly influences player retention rates. The more betting opportunities a user has, the higher the probability they will return to the bookmaker, making it easier to retain them.”
Developing for the future: DATA.BET’s plans for new and innovative products
Alex shared that DATA.BET is in the process of introducing an innovative muti-competitive LIVE feature that allows players to place live bets on games with multiple competitors. This will include racing and battle royales, which can reach up to 60 players at any one time.
He concludes, “It will be a significant advancement compared to the common “versus” fixture with only two teams. This new feature promises a more dynamic and engaging esports experience, expanding the possibilities for live betting.
“Looking ahead, we have exciting plans, including enhancing the functionalities and capabilities of our products, as well as expanding the product line. This entails the introduction of new Scoreboards and Pitch Tracker widgets, which are designed to maximise profits and offer a more comprehensive and customisable platform for our clients. So, stay tuned for more exciting developments from DATA.BET.”
Alex Kozachenko, chief product officer at DATA.BET