The killer quartet of sportsbook performance
The promise presented by sports betting in North America has created severe competition. Beyond big casino and media giants like Disney, we see retail companies – such as Fanatics – trying to actively take their place in the market. New York sportsbooks alone brought in $425m (£350m/€413m) in gross revenue in the first four months of 2022.
However, in a rush to be the first to attain licences and launch, operators often neglect the quality of their platforms. Early in 2022, when thousands of bettors flooded the freshly opened sportsbooks in New York, we saw betting platforms that were glitchy: a direct result of poor development. Bettors experienced technical issues such as login errors, the inability to place a bet or cash out, and more.
For example, Caesars faced a massive volume of complaints about glitches to the point that its customer service department could not handle the load and eventually disabled the online chat option.
On average, only 52% of bettors make more than two deposits, and only 4% stay loyal to a betting company longer than a year. These issues and unpleasant bettor experiences could cost a sportsbook a large sum of money and ruin their reputation, which will result in a loss of bettors. Poor response time, instability and other factors can lead to millions in losses in handle.
To mitigate such potential risks, performance testing should be the cornerstone of the development process for any other application within the sports betting stack. It should be included in the overall process to ensure that latency does not appear in new releases.
What is acceptable performance? There are four important parameters: system response, scalability, stability and capacity.
Let’s dive into each of them.
Quick system response
Sports betting is an extremely complex domain dealing with a huge volume of data from big events like the World Cup or NFL games and constant odds changes. Needless to say, it’s an ever changing domain of data which requires lightning-fast decision making and updates.
Besides, bets are made in real time, so the slightest delays on your platform can totally ruin your bettors’ experience. Additionally, obtaining immediate statistics during live games is critical for in-play odds for both regular sports and esports.
The streaming of esports matches is usually received with at least one minute’s delay, but it can be up to five minutes in some cases. While sharp bettors are aware of these delays, it may be harmful for newbies betting on a stream.
The primary causes of delayed response times include heavy and excessive operations in backend logic, hardware limitations and incorrect configurations of related software, among many others.
To eliminate these issues, I recommend solutions and technologies such as WebSocket and HTTP 2.0 protocols, and optimising web servers and databases.
When we talk about betting platform scalability, we need to first think about transactional scalability.
If you’re dealing with same-game parlays, you have an enormous dataset that you need to be able to calculate and run your simulations against to determine their price, which returns an enormous set of results. On the prices your sportsbook generates, you need to add scale and you need to make sure you have consistency both at the edge and in the core.
There are also architectural and geographical challenges. Regulations open up markets, but they also introduce constraints. The Wire Act requires operators to install servers in every state where they are active. You need to deploy and scale in many places and build a cloud-based system that scales on top of AWS or Azure.
Additionally, you need to be able to deploy critical elements of your system that meet regulatory requirements in each jurisdiction. And you must deploy servers and software components into a casino property where regulation requires it.
So you do not need to run 50 different sportsbooks, but one that scales in order to meet each state’s regulatory requirements.
Scalability testing allows you to measure the ability of your platform to scale up or scale out during traffic spikes with thousands (or more) concurrent transactions. Among the most common issues that can be detected during scalability testing are:
- databases initially built without scaling capabilities
- outdated deployment solutions
- incorrect autoscaling configuration
- and even the wrong subscription for cloud services
Nowadays, many autoscaling solutions, such as AWS Auto Scale or Azure Autoscale, automatically maintain your platform’s target performance.
Stability is the most critical factor for online sportsbook operators seeking to drive acquisition and retention. Operators should ensure that all functionality and features are working properly at all times and that bettors can access the sportsbook and use it as they would expect to, especially when the volume of bets is peaking.
In an attempt to engage new players and cross-sell to current bettors, some operators branch out into the online casino sector. This is where the real challenges begin. Besides a vast volume of daily transactions from online bets, and additional spikes during major sporting events, operators which have online casino offerings have a lot more to worry about. This culmination of transactions can put tremendous strain on a platform.
A large number of third-party plugins accompanied by legacy technology engages some operators into the eternal race for the right balance between functionality and technology debt. Operators need to test and implement new technologies all the time – they need to look for ways to eliminate glitches and increase speed and tenacity of their solutions. Yet, it becomes imperative to achieve architectural balance where new and old can work together while also being reliable and stable.
Endurance testing allows you to check the stability of your betting platform. During endurance testing, you examine your platform under a substantial load and extended usage time. Memory leakages, database connection closure and connection closure between system layers are all tested, among other factors.
To improve the stability of your betting product, you might consider:
- setting up load balancers so new users will be assigned quickly and correctly
- add caching layers that will store a subset of data and serve data faster
- setting up proper auto-scaling and more
Driving acquisition during a major sports event appears to be tempting, and we see many betting providers running multimillion-dollar marketing campaigns and giving away generous bonuses during this time. But this spend will be for nothing if operators do not get the basics right and their betting platform does not have enough capacity to deal with the influx of new fans and placed bets. The data says that 91% of enterprises have downtime costs surpassing $300,000 per hour.
By capacity of your betting platform, we mean the number of users and/or transactions it can handle simultaneously and still meet performance goals. The capacity of your betting platform can be hampered by:
- a lack of database resources
- limited network and bandwidth capacity in certain locations
- low-quality source code that includes restrictions for databases
- source code written in outdated language or tools
- an architecture that is unable to handle high volumes of transactions
Load testing can help you determine your platform capacity and plan your activities for increased traffic. To enhance capacity of your betting platform, you can change your deployment approach, optimise requests to your databases, configure additional servers and more.
You should also carefully consider using the services of a third-party technology provider instead of building your own product. However, Super Bowl LV showed vulnerabilities of third-party providers, as some bettors could not place bets.
Build a solid foundation
Betting operators constantly find new and creative ways to engage and retain fans, from NFT collections to holograms and live dealer studios. But let’s not forget that technology is at the centre of it all. No matter how many dollars you spend on a new marketing campaign, if your platform is full of flaws, users will experience delays during important moments in events. Similarly, if your design is not intuitive you will be losing bettors. Exceptional performance of a platform must be the foundation of any online sportsbook. Operators which create innovative platforms that are secure, scalable and engaging will be the ones that take home the big win.
To summarise, it is imperative for online operators to ensure their platforms are well architected, secure, scalable and stable. As the sports betting market continues to evolve and bettors are becoming more demanding, online operators must be nimble and their technology stack must support the ability to quickly adjust.
At the same time, online operators continue to develop new features. There is no shying away from the fact that technology holds the key to the success of these endeavors and must be taken seriously. Otherwise, the best laid plans could significantly go awry.
Russell Karp is vice-president of media and entertainment at DataArt, a global technology consultancy that designs, develops and supports unique software solutions for its clients. Recognised for deep-domain expertise and superior technical talent in creating new products and modernising complex legacy systems, DataArt has been partnering with global sports betting companies for almost a decade. During that time, the firm has helped operators significantly change the sports betting market by offering broader choices and better pricing to their customers. Clients include Paddy Power Betfair, Evolution Gaming, Glück Games and Playtech.