Gambling writer Jon Bryan discusses how the growing cost of living crisis may affect consumer interaction with the UK gambling industry, and how operators will respond should business start to falter.
The Guardian recently asked people to tell them how the cost of living was impacting their gambling habits. I’m sure some people will be wondering if this story is to be another angle in the continuing discussion on affordability checks – updated to take account of inflation and a likely declining level of disposable income. I guess we will have to wait and see.
It’s likely that the impetus for this survey came from a story in The Guardian earlier in the month, which reported that Flutter Entertainment had seen rising global income and a consequent increase in share prices. Commenting on this, Flutter Chief Executive Peter Jackson said the company was seeing "no discernible signs of a consumer slow down and resultant reduced spending levels across our businesses." No doubt everyone associated with Flutter will be pleased to hear that, but things could well change as the cost of living crisis deepens.
"If urgent action isn’t taken soon, continued energy price increases could have a catastrophic impact across the hospitality and leisure sector, including hitting our members" Betting and Gaming Council CEO Michael Dugher
All gambling companies will be looking closely at the economic circumstances they are facing, wondering whether they are about to hit some financial problems as we face an economic downturn. This is a concern to those who represent the betting and gaming industry. Responding to the rising costs facing betting shops and casinos, Michael Dugher from the Betting and Gaming Council has called for government action to address this: "If urgent action isn’t taken soon, continued energy price increases could have a catastrophic impact across the hospitality and leisure sector, including hitting our members."
Meanwhile, businessman and commentator Adam Brooks has said the economy could do with a Martin Lewis figure to stick up for businesses, particularly the hospitality and leisure industry: "Martin is doing an incredible job – if only there [were] someone with as much clout defending business."
So what will the future be like for gamblers and gambling companies as the cost of living crisis deepens?
There is an argument that some punters are quite used to adapting what they do to take account of a falling level of disposable income. Go to any racecourse and you will see dozens of people waiting deliberately and patiently to get the best price from a bookmaker, offering the longest odds for a particular horse. Prudent behaviour like that might be replicated in other scenarios involving gamblers, such as taking advantage of casinos offering cheap/free drinks and food, and taking up offers from gambling companies who might start to offer more free bets/spins and other promotions.
“Gamblers are ordinary people, who are used to adapting to changing circumstances. The months ahead are going to be tough for millions of people as we head into the winter, but reports show that some companies may not be as impacted as others”
Gamblers might (and do!) take risks at times, but many are also "sussed" enough to take advantage of such offers, especially when costs are rising pretty much everywhere. It’s probably worth noting here that the UK Government’s gambling review is considering whether such promotions should be banned, amid accusations by some that this smacks of a "nanny state."
Of course, there will also be punters who simply continue to place the same amount of money on a bet as they always have done. While you can continue to place, £1 ($1.16), £5 or £10 bets in the bookies, without adding a few pence on for inflation, the same £10 note will get you less food from the shops. The amounts being staked may not change, while the amounts being won are going to be worth less to the winner as everyday living costs continue to rise.
It is not easy to predict how everyone will act in the coming months as we adapt to changing circumstances, but perhaps one thing that is guaranteed is people will continue to have a bet. The chance of winning offers a way out for some people; a point made by comedian Leo Kearse on a Spiked podcast recently: "Gambling shops sell hope. For some people, that's a real thrill and one part of their week where they really feel alive." Commenting on the Flutter results recently, a similar point was made by Danni Hewson, a financial analyst at AJ Bell: "People will be happy to keep betting in the hope of winning big during more difficult economic times."
Gamblers are ordinary people, who are used to adapting to changing circumstances. The months ahead are going to be tough for millions of people as we head into the winter. But reports, including one this week from Lottery group Allwyn Entertainment, whose Chief Executive talked of a "strong performance…during an unprecedented shock," show some companies may not be as heavily impacted as others.