Sportsbet Outperforming Expectations in Australia
Flutter, the Irish-based sportsbook conglomerate, is hailing the success of its over-performing subsidiary in Australia. The market represents a new frontier for the Irish operator and expanding their presence in the region certainly didn’t come without risk. But looking at initial results, it’s clear this was a move that will pay dividends. The competitive Australian sports betting market has become the focus of many European brands seeking to absorb market share with higher-quality products closely aligned with the users’ needs.
Flutter have enjoyed enormous successes from it’s high-flying subsidiary Sportsbet. The bookmaker brand has taken Australia by storm, and now sits in a commanding position controlling around 50% of the entire sports betting market in the country. ©phillipkofler/Pixabay
Irish betting is symbiotic with the culture of sport in the country, think greyhounds, Gaelic football, and horse racing. The games and sports that Ireland is best known for naturally lend themselves to the functionality of fan engagement and betting. It’s no surprise therefore that some of the biggest and most successful brands in this space are owned & operated from Ireland. Paddy Power is the biggest example of this regional power, but there are indeed plenty more.
When it comes to the Sportsbet venture, this company has managed to establish itself quickly as a market-leading force in a country sparsely populated with strong sportsbooks. There exist just a few companies trying to serve the huge demand, but the majority of platforms used by Australians are not managed within the territory itself. Sportsbet is just another example of a fantastic European brand taking this market by storm.
Flutter has become an absolute behemoth in the global sports betting industry, as the holding company of Paddy Power, Betfair, PokerStars, Sky Bet, and other brands – they hold a massive share of the industry under their control. The brand most impressing executives at Flutter this year has been Sportsbet, which is reportedly now controlling 50% of the sports betting market share in Australia throughout the first half of 2021.
Growing at an Exceptional Pace
The strong financial performance of Flutter over the lockdown period is not exclusively down to their own delivery. Market conditions have been overly favorable for sports betting companies in Australia, and the surge in demand has created strong long-tail growth across the entire sector. Analysts looking at the business situation in more detail have calculated a 21% compound annual growth rate (CAGR) over a period spanning the previous five years.
Interestingly, there appears to still be a huge volume of uncaptured demand for sports betting products across Australia. Flutter produced a deep dive into the behavior and share between sports gamblers compared with regular casino players. Astonishingly, only 17% of the total gambling market share in Australia was attributed to sports betting customers, highlighting the strength of the casino industry across the country. With great power comes fantastic responsibility, and it is clearly the objective of Flutter to help drive a shift in the momentum of these market forces towards sports betting.
Flutter shares have enjoyed a strong performance over the past week following the news of the successes in Australia, with prices rising some 5% in morning trading on the London Stock Exchange. The market is obviously cognizant of the immense financial reward that could be directed towards the holding company should their subsidiary continue to make significant advancements in this market.
Flutter and Sportsbet Have a Clearly Defined Strategy
The example being set by Sportsbet is a powerful lesson that will surely set the tone for how bookmakers consider their go-to-market strategies in the coming years. In all cases where a competitive set of market conditions emerge, and companies fight for customers – the product always wins. Paying attention to the customer, understanding exactly what they need, and servicing that demand is the key that Sportsbet has unlocked.
Believing in the power of product innovation is certainly an important underlying factor in the success of this company. Showing a clear intention to service the demand of the users is another thing they have done exceptionally well. Combining both two fundamentals over the previous 1 year has led to impressive market share gains for Sportsbet. Consolidating these victories and establishing a powerful brand presence in the region will now serve as an important waypoint for the group moving forward.
There is a clear systemic advantage that Flutter can leverage when launching new high-scale projects in foreign markets. With their immense resources, they can quickly navigate and circumvent the difficulties that are encountered by regulatory and tax authorities in each region. The inevitable pivoting that must be taken when starting out only adds to the teething issues that smaller companies find so difficult to break through.
It’s clear that Flutter’s Sportsbet experiment has been a major victory, with the bookmaker setting records on growth and revenues that nobody could have foreseen when the venture began. Savvy strategy combined with a huge wealth of resources has been fundamental to the success of these ventures. It results in the success story that we have witnessed in Sportsbet’s launch in Australia.
