The newest mature market

Think of new markets opening up to regulated igaming currently and a number of jurisdictions may come to mind. Among the most obvious choices may be Ontario, which permitted licensed operators to launch their products on 4 April.

But for Ohad Narkis, chief executive of SkillOnNet brand PlayOjo, it isn’t right to treat Ontario like a new market. Despite the recent launch, he notes that it has the characteristics of somewhere that has permitted igaming for a much longer period of time, thanks in part to the many years spent as a grey market before steps to regulate began.

“Ontario I would definitely place similar to the more advanced and more mature European markets, similar to the UK, maybe even similar to New Jersey, where we don’t operate yet but will do,” he says. “I think it’d due to the fact that Canada as a whole was quite mature as a grey market, and quite developed in sports betting as well as igaming. And it’s affluent, with a middle-class audience and it’s tech savvy. All of that lends itself well to a high participation rate for gambling and potentially high player value.”

Despite the many ways Narkis sees Ontario as a mature market, it ultimately is one that’s new to regulated online gambling. While the familiarity with the products themselves may already be there, familiarity with the specifics of a regulated environment may not.

This, Narkis says, could create teething issues, as players used to the lack of checks in the pre-regulated market face an unexpected amount of hurdles in order to be able to play.

“There are early-stage problems, such as players that all of a sudden need to be verified,” he says. “They need to use third-party software that detects their location. These type of settings could lead to drop-offs.

“Particularly for players who played before with grey-market operators where they were not asked to go through those stages, they now will have to get used to it. As technology advances, it will mitigate those things, but in the near future that will be a challenge.”

Promotional strategy

Part of the ways in which Ontario resembles a mature market may be down to the rules around promotions. The province’s standards for betting and igaming included a number of ad restrictions, including a rule stating that bonuses could not be advertised outside of operators’ own websites. This, Narkis says, has made it more difficult to rely on the tried-and-true method of affiliation to gain market share.

“There is a challenge in finding affiliation channels, because in Ontario you cannot advertise bonuses, so we’ll have to see how that pans out,” he says.

When comparing Ontario to those jurisdictions to its south where operators have been happy to spend huge sums of money on bonuses, that creates a stark difference. Indeed, a number of leading US operators have already fallen foul of Ontario’s marketing rules.

With less focus on bonuses, the market may naturally look more similar to more mature jurisdictions.

Narkis notes, though, that there are plenty of options available to operators who have a good understanding of a range of marketing tools.

“There’s an advanced and rather restriction-free media landscape,” he says. “Everything from above-the-line to below-the-line to digital will now become available. There’s Google, Facebook, programmatic advertising, connected TV. It allows operators who are marketing-savvy and want strong brands, if they invest wisely, to build strong brands.”

And while there may not be as much aggressive bonusing as the US, Narkis says that there will still be plenty of fighting for market share.

“I think that we will see, at least in the first couple of years, some aggressive land grabbing from a marketing point of view from some new entrants,” he says.

“It will be interesting to see how the incumbent brands, the ones that have already been operating in the grey market, respond to this. How they respond might be very different depending on their overall strategies.”

Among those willing to make a big splash in advertising, Narkis says, will be his own business.

“We are going to be very aggressive in the marketing,” he says. “We have a seven-figure marketing budget, we’ll be using it for above-the-line and through all of the harvesting digital channels, whether it’s PPC, programmatic, native and definitely will have a big focus on apps.

Tough competition

However, a seven-figure marketing budget may still be dwarfed by that of some of the biggest names in the market.

“For us being a private company, competing with those operators with very deep pockets, and maybe not always an eye-on the bottom line, that can create a challenging environment for us,” Narkis says.

As a result, he says the business will focus on reaching a type of player distinct from those targeted by large operators known for their sports betting offerings.

“We try to build a brand that companies who might be in igaming and sports betting would not necessarily target,” he says. “So we’re not really trying to get the 25-45-year-old sports punters because we can’t really compete for share-of-voice on those ad breaks on TV. We’re looking for softer entertainment, maybe reality-type entertainment.”

A key part of SkillOnNet’s marketing strategy for Ontario, as it has been in other markets, is the use of multiple brands. The operator received approval to launch three different brands – PlayOjo, SpinGenie and SlotsMagic – in May, before then being approved to launch a fourth.

“Overall from a SkillOnNet point of view, the company usually has more than one brand, and then usually has a leading brand. It then invests in media and marketing to build that brand,” Narkis says. “So here, SpinGenie and SlotsMagic kind of target the classic casino players, whereas PlayOjo is more of a challenger brand, a mass-market, softer brand. It targets the casual player.

“We have very aggressive plans for this market. We believe that it’s a very lucrative market, and we believe that we have a good standing point to be successful,” he says. “The fact that we are very focused – we just do casino in Ontario – helps us to focus on providing the best product. We believe that this could be a very substantial market and we would like to be one of the leading brands in that market.”

Again, he says that this ties back to his view of Ontario as a more mature market. This, he says, means that customers will understand the different places that different brands can hold in an overall ecosystem.

“We believe that in Ontario, given that it is a mature market, players will be able to appreciate and understand the differentiation,” Narkis says.