Customers will likely have seen the influx of free prediction games appearing on operators’ dashboards in recent years, and it has opened the floor to understand how effective these games can be to bring in new sign-ups and retain existing players.
Alternatively, third-party free-to-play platforms face a big step when agreeing to work with affiliates or new media partnerships in terms of changes to compliance and the logistical process.
With an anticipated clamp down on gambling sponsorships, there are also opportunities on the horizon that would specifically benefit free-to-play companies commercially, which need to be considered.
Sports betting technology supplier 20Shots has recently collaborated with BoyleSports to see its free-to-play fantasy football platform Fantasy5 hosted on the site.
Co-founder Jacob Kalms gave some insight into the pros and cons of running a free-to-play platform, how joining up with large operators can open up doors and what the future holds for free-to-play platforms.
From a compliance perspective, how does running a free-to-play platform differ from running an operator?
JK: It’s not an easy comparison but there are similarities between the two. Operators have to deal with compliance on a day-to-day basis across their entire platform. Whether it’s promotions, customer welfare or KYC, the operator will need to follow strict guidelines. For free-to-play companies, it’s a little different. Firstly, free-to-play platforms do not have to be licensed to offer their B2C products. There are similar compliance issues when it comes to exchanging user data with B2B partners but besides that, the process is much easier. Most free-to-play games have no monetary transactions. This removes the need for full KYC checks and therefore gives free-to-play platforms an opportunity to grow much more freely with the absence of hardline verification which is a major drop-off point.
What are the biggest challenges that free-to-play companies currently face?
JK: In its essence, FTP businesses should provide either increased acquisition or retention via their product to an operator. The rise in free-to-play game providers has led to better products and more choice for the consumer. This, however, has made bringing in new players and growing traction for specific games now harder to execute and FTP providers will struggle to keep their daily/weekly figures up. The need to build a community around the FTP games is ever-growing and that’s a challenge all new FTP products will face, alongside existing businesses.
How could you see the Gambling Commission’s White Paper affecting free-to-play games, if at all?
JK: Without knowing too much about the details involved as everyone in the industry waits for full confirmation, it’s unlikely that many aspects of the White Paper will affect FTP operations. The review seems more tailored to helping operators manage more transactional and account issues such as affordability, problem gambling prevention and money laundering awareness that would be outside of an FTP’s remit. That said, the principles we are anticipating will still be upheld and followed throughout the industry with the aim of doing more to protect customers and allowing them to enjoy their experiences for the long-term interest of the sector.
How does a free-to-play operation change once a media partnership has been agreed? What are the pros and cons?
JK: The operation remains the same, the platform just utilises the resource, customer base and reach of a host operator. Platforms can become less reliant on generating further interest from niche markets as, if a firm is merged into an existing operation that fits its product, the audience should be somewhat of a select target audience for the incoming platform. One issue that can be overlooked by creators who hand over their products is losing their fanbase and community created over a period of time as mentioned above. There are often discussion forums, social media channels and general online chatter about decisions made in the game that new parent companies/partners can sometimes neglect.
What benefits do free-to-play businesses gain from working with big operators?
JK: Reach, firstly. A game can be played by a whole customer base that already exists. Also, the ability to develop and try new products to test with new audiences. For example, with our Fantasy5 product, we have been able to develop a Champions League game in addition to our Premier League game - this gives platforms like ours the chance to open up to other markets.
Being under full Gambling Commission regulation also offers companies the chance to host fixed odds sports betting on outcomes that relate to the free-to-play product. This extension drives a percentage of revenue and builds on the game’s initial offering to give customers another reason to sign up and play.
Can free-to-play games be effective for operators?
JK: It seems more operators have adopted free-to-play platforms as we head out of the global pandemic. And they are doing so as they are an effective tool when used correctly. Not only do they increase engagement and reduce acquisition cost, they more importantly extend the lifetime of a customer and in turn increase the operator’s profits. As a long-term tool, free-to-play games can be a great alternative to offer a way of retaining and moving players through the conversion funnel.
How about from a marketing perspective?
JK: 100%, the fun aspect is something that appeals to the everyday customer. However, from a business point of view, the data and the analytics involved in free-to-play numbers can be really useful to create better experiences for existing and new customers across an operator’s site. For example, if an operator knows 75% of players are interested in one particular game and their retention rate is especially high - they can use this to dictate the offers and products they show to the customer.
What does the future hold for free-to-play platforms?
JK: I believe that FTP platforms are here to stay. Not only in their existing format but also outside of sports betting, as companies look to engage with their users in new and unique ways. If free-to-play games reduce acquisition cost, increase engagement and improve retention figures, there is no reason they should not be utilised by any consumer-facing brand. It’s the companies that are able to build products to achieve this that will come out on top. There will also be opportunities for more commercial partnerships to be activated by FTP platforms, with the anticipation that regulated gambling sites may soon be prohibited from sponsoring big events or sports teams.