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Bookies - the strangest "retailers" in the world?

Bookies - the strangest 'retailers' in the world?

Campaign for Fairer Gambling | Campaign for Fairer Gambling

4 min read Partner content

The Campaign for Fairer Gambling is critical of the bookmaking industry for not being clear on turnover figures from fixed odds betting terminals and declining some over the counter bets for no specific reason

When Paddy Power was exposed for targeting vulnerable peopleby locating its FOBT-driven betting shops in areas of high deprivation and immigration their answer was as usual misleading – “Like every other retailer our shops are located where there is high customer demand for our services”.

Well, the supply of product creates the demand and any retail business places its products in the locations it will generate the greatest FOBT demand. So Paddy Power is admitting there is more demand for FOBTs in areas with a greater share of vulnerable populations - exactly the people who should be protected from gambling harm. It's a strange retailer that does not want to admit awareness and targeting of their most profitable demographic!

The annual Campaign statistics always include the gross amount gambled (the turnover) on FOBTs. In certain media this has been referred to as the amount "spent" which is technically incorrect, as it is the amount wagered. Spend is a retail concept, and as bookies want to call themselves retailers, it is inevitable commentators will want to look for a "spend" figure.

The gross gambling yield, from the bookies and the tax authorities point of view, is the same as the amount lost from the gamblers point of view. Again "spend or spent" is not, in the Campaign’s view, the best terminology in gambling when another term "loss or lost" can be used.

Cash deposited into machines to commence or continue play is the amount the player is risking and it is this starting cash that generates the turnover. The bookies want to play down FOBT turnover, which this year we estimate stands at £42 billion, but there are many reasons why turnover matters. It is a very strange retailer than does not want to talk about turnover!

Firstly, the bookies in their annual reports include their over-the-counter (OTC) turnover, which includes racing and sports betting. Increased turnover is a sign of a growing business.

Secondly, FOBTs are required under Gambling Commission regulations to display information to the gambler regarding the "return to the player" as part of the "fair and open" licensing objective. For FOBT roulette this is 97.3%. But this theoretical payback is not related to the amount of cash deposited as it actually relates to the turnover.

Thirdly, turnover is the measure of the engagement in the activity, with the consequential loss being the result of the engagement. Inevitably different forms of gambling have different loss to turnover ratios. The turnover on FOBT gambling is now far greater than the turnover on OTC betting, meaning that FOBT gaming is now the primary activity in betting shops. Corals 2014 annual reportshows that 84% of all their shop turnover was generated on FOBTs with just 16% transacted on traditional sports and race betting.

Local authorities have argued that a betting license requires betting to be the primary activity rather than gaming. But the Commission does not support this view, so local authorities have been unable to use the turnover figure to prevent new betting offices.

Fourthly, the bookmakers also have remote gambling sites, which they promote with free credits or bonus offers to attract new gamblers. The terms and conditions of these offers require a certain amount of turnover, prior to the gambler being able to withdraw any funds, which diminishes the free credit or bonus to often little or no value to the gambler.

What retailer though would refuse to sell its products at advertised prices? Step forward the bookies. The editor of the Racing Post, Bruce Millington, recently tweetedregarding being knocked back when trying to get a £50 bet on West Bromwich Albion to win the FA Cup, before the quarter finals had been played. General odds were 12 to 1 with a few slightly higher prices. Mr. Millington stated that there was a better price, so presumably was trying to get on at 12 to 1 meaning that if the "Baggies” won he would stand to win £600 if he had got on. Mr. Millington might be sharper than the average punter but he cannot have any inside information on the winner of the FA Cup – especially when at the time Arsenal, Liverpool and Manchester United were all still in the competition.

The bookies get away with discriminating against winning or even break-even gamblers by refusing to stand by their advertised prices. But the real discrimination is that no one is prevented from betting as much as they wish on FOBTs. Vulnerable people, losing as much as they can get their hands on, are the real victims of bookie discrimination.

Whilst the bookies will squeal about the Campaign publishing estimated turnover statistics there are multiple reasons why their squeals should be ignored. And when the bookies claim to be "retailers" catering to demand, why not ask them - "Why do you discriminate your customers?"

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