Entain CEO Jette Nygaard-Andersen has made responsible gaming a key pillar of the company’s business … [+]
Shortly before Entain plc appointed Jette Nygaard-Andersen as its CEO last January, the European gaming giant reached a crossroads of sorts.
Entain, one of the world’s largest online gaming companies, entered a 50/50 joint venture with MGM Resorts
But MGM Resorts made a power play to gain full control of BetMGM with an $11 billion takeover bid of Entain that the London-headquartered conglomerate dismissed out of hand, claiming that it substantially undervalued the company. Days later, former Entain CEO Shay Segev left the position while asserting that MGM’s offer had no bearing on his decision. By last October, DraftKings entered the fray with a $22 billion acquisition attempt of Entain that underscored the value of the platform throughout industry circles.
On a busy sports day, the platform has handled about seven times interactions than Amazon
Although DraftKings eventually pulled the proposal, the bid demonstrated Entain’s standing in the global gaming hierarchy for top U.S. gambling operators looking to expand abroad. Now, 16 months later, Nygaard-Andersen has earned plaudits for the company’s advances in responsible gaming, corporate sustainability, and diversity under her leadership.
“Jette has been the key architect of Entain’s successful evolution from a world’s leading gambling business into a global entertainment and technology heavyweight,” said Martin Lycka, who serves as senior vice president of American Regulatory Affairs and Responsible Gaming at Entain. “She has based her strategy on putting an extremely robust responsible gambling program into the very heart of Entain’s culture.”
Nygaard-Andersen, who celebrated her 500th day at the helm earlier this month, is encouraged by the progress with the company’s Advanced Responsibility and Care program, better known as AR
During the first quarter, Entain saw a 30% decline in the number of customers who increased their risk levels, based on the analytics that monitor the markers of protection. The markers, which were developed through Entain’s partnerships with Harvard Medical School and other leading researchers, run the gamut from spikes in play to chasing losses, as well as increased deposits and irregular betting patterns.
Entain intends to continue the trial program in the U.K before fully rolling out the initiative throughout the British market later this summer. Early results indicate that the models can predict the likelihood that betting activity may rise to harmful play with a near 90% certainty, up from previous estimates of around 80%. As it relates to the U.S., Entain plans to roll out the ARC program internationally after the debut in England.
The proliferation of mobile sports betting has created a dynamic where players can not only bet rapidly, but can race to recover their losses just as quickly. Take for instance, Wednesday night’s Game 3 of the NBA Finals between the Boston Celtics and the Golden State Warriors. Before the game, a recreational bettor can hypothetically place a series of 10 microbets for $10 each to whet his gambling juices. The wagers may be as obscure as the first player to hit a field goal, Jayson Tatum’s steal total, and the number of 3-pointers sunk by Draymond Green. A prop on Andrew Wiggins to hit the game’s first field goal, parlayed with a Celtics’ win contained odds of 12/1 at BetMGM. The bet was graded as a loss within seconds when Kevon Looney opened the game with a layup.
With the Warriors down 79-66 at the 7-minute mark of the third quarter, it becomes clear that the majority of the other props will lose, as well. The customer, who has $1,000 in his account, decides to chase the losses with a $100 moneyline bet on the Warriors at 4/1. Then, Golden State heats up.
Klay Thompson drains a 25-footer to cut the lead to 79-69, followed by a Steph Curry runner to place the Warriors within eight. At the click of a mouse, the bettor puts another $100 on the Warriors. Then, with 5:06 left in the quarter, Curry completes a rare four-point play after Al Horford commits a flagrant foul on a made three. All of a sudden, the lead dips to five.
The Warriors even take the lead 83-82 on a Curry three at the 3:45 mark. The bettor doubles down with a $500 moneyline wager on Golden State. It is Golden State’s only lead of the half. A quick run by the Celtics early in the fourth quarter pushes the Warriors’ in-game odds to +440. The customer instantly deposits another $1,000 into his account.
When Boston increases the lead to 102-91 with 9:07 left, the odds on the Warriors jump to +960. Panicked, the bettor tries to recoup all his losses with a $200 bet on the road team. He also puts another $700 on the over at a total of 228.5 points.
The outcome is anti-climatic as the Celtics took Game 3 decisively 116-100. But for the bettor, the losses nearly clean out his account. Over the span of four hours, an evening that started out with just $100 on the line turns into a $2,000 night.
The aforementioned scenario can be dismissed as an outlier, a bad night for a customer who is usually prudent on limiting himself to props of $25 or less. But if the bettor continues to chase losses for the remainder of the NBA Finals, there can be cause for concern. The activity may rise to compulsive gambling if the bettor repeats the frenzied activity every night for the next two months.
Nygaard-Andersen emphasized that Entain focused on a small cohort of high-risk U.K. players in the initial trial phase, a group she noted represents less than 2% of all sports bettors in the country. At the same time, Entain has seen an increase of 56% in its base of recreational players over the last several years. Since every bettor has different personality traits, as well as disparate bankrolls, the protections for high-risk bettors cannot be the same as those for customers who limit their betting to $10 straight wins.
Eventually, Entain could broaden the program to moderately-risked players as the initiative expands.
“The fundamental vision here is that we want to personalize this,” Nygaard-Andersen said in an interview inside a drawing room in lower Manhattan’s Crosby Street Hotel. “We don’t want to have the same framework in place for everyone, that’s not healthy business and it’s not a great experience for a casual player who wants to place a bet on their favorite team.”
Entain uses other behavioral markers in its machine learning-based assessment. The algorithms literally train on millions of data points that inform the company on the proper course of action based on a customer’s activity. A player could be placing bets at odd times of the night when his wife falls asleep, Nygaard-Andersen points out. The customer could also be betting above his means by placing deposits with multiple credit cards. Customers who spend hours on end on a mobile betting app might receive a warning to take a break. If the warnings are ignored, a player may be restricted from using the app for the next several hours.
“If you don’t take a break, we basically force you to take a break and then you can come back the day after and play again,” Nygaard-Andersen said. “That has proven to be extremely powerful.”
Last month, author Alan Shipnuck reported in his unauthorized biography on Phil Mickelson that the golfer rang up losses of more than $40 million in gambling losses over a five-year period through 2014. Before this week’s debut of the LIV Golf Series in London, Mickelson acknowledged that his gambling devolved to a point where it became “reckless and embarrassing.” He has addressed it with hours of therapy.
In numerous European countries, when a compulsive gambler registers for a self-exclusion list, sportsbook operators have an obligation to not accept their bets. A number of U.S. states have self-exclusion plans in place, with robust safeguards in at least three Northeast states: Connecticut, New Jersey, and Pennsylvania. Entain also has affordability thresholds for bettors; in some cases if the thresholds are exceeded the company will suspend a customer’s account.
Brianne Doura-Schawohl, former vice president of U.S. Policy and Strategic Development at EPIC Risk Management, now runs her own boutique gaming consultancy firm in Reston, Virginia. Moving public health approaches to proactive prevention has long been sought after in the online gambling space, she noted.
“Sophisticated technology such as this is an absolute game changer for the industry,” Doura-Schawohl said. “Ultimately adoption of technology will lead to a more robust understanding of early warning signs, proper engagements and effective methodologies of interaction and interventions that will result in a healthier player base.”
The National Council on Problem Gambling (NCPG) applauds efforts from operators to use A.I. and machine learning techniques as a mechanism for potential risk mitigation. Still, detecting a problem gambling issue in a customer is massively complex, one that cannot be solved solely through cutting-edge technology, according to the council.
“We want to be careful that this technology is not being overpromised,” said Keith Whyte, executive director of the NCPG. “It’s really important to note it is more about detecting potential markers of harm, making appropriate interventions, and reducing risk to improve responsible gambling, rather than decreasing the rate of gambling addiction. At some point, when someone with potential problems is identified, problem gambling experts need to be actively involved in these interventions.”
The sentiments are echoed by U.K. based Gambling Integrity, a presenter at this week at the NCPG’s National Conference on Gambling Addiction & Responsible Gambling’s digital symposium.
“From our point of view, the interesting question is not whether A.I. is any good at spotting risky play, but what happens next? How do you reach out successfully to a player? How best to actually change behavior? There’s not much point in spending millions on technology, if you can’t communicate effectively with the player base,” said Sarah Ramanauskas, partner at Gambling Integrity.
Entain may counter that its plan will be a critical first step. Entain is making interaction a point of emphasis, with not only interactions with customers online, but interactions in real time. NCPG research indicates that those who bet using mobile devices have higher rates of problem gambling. Moreover, in-play betting decreases the lag time between a bet and the reward, which increases the speed and frequency of gambling that in turn creates a higher risk of problematic behavior, according to the council.
Entain projects that the ARC program could have an overall EBITDA impact of £40 million, with about half from the closure of markets that aren’t regulating in the immediate near future.
Nygaard-Andersen holds the distinction of being one of the only female CEOs on FTSE 1000, a compilation of the U.K.’s top businesses.
“I can honestly say that I don’t wake up in the morning and think about myself as a female leader,” she said. “I really hope we’ll reach a point also in this industry where it’s not about gender, it’s just about great leaders.”
“I think we need more female CEOs that can show the way and can show that there are no glass ceilings. In order to do that, though, we need all of us, so men and women join up with that effort. ”
Source: https://www.forbes.com/sites/mattrybaltowski/2022/06/09/entain-encouraged-by-progress-with-ai-platform-on-responsible-gaming-as-ceo-celebrates-500th-day-at-helm/