Ad agencies study the new gambling form

Any changes to gambling ad rules are years away, but ad agencies are already checking the odds of them being able to cash in, says Rory Cavanagh

The roulette ball landed kindly for the &£42bn UK gaming and betting industry last week after an independent report recommended a major overhaul of gambling laws for the first time in 30 years.

Among the 176 recommendations made in the government commissioned report is the scrapping of the draconian advertising restrictions – a potential jackpot for the marketing industry. The report’s author, Sir Alan Budd, recommends setting up a Gambling Commission which would regulate advertising practice.

Casinos, which at present can only advertise on a “non-informative” classified basis, are likely to be the major beneficiaries of the report. Other areas of the gambling industry have been given more freedom to advertise since the restrictive 1969 Gaming Act was introduced. Five years ago the bingo industry was told it could advertise across all mediums while the &£7bn bookmaking industry was allowed to advertise in print.

Andrew Burnett, a leisure analyst at Merrill Lynch, says: “This report is hugely important for the industry. If the proposals are accepted, all sectors will be able to promote their business on billboards, television, cinema and radio.”

The consultation period is expected to end in October, with a Government response early next year. But it could be up to four years before any of the recommendations become law. In that time there is likely to be fierce opposition from anti-gambling groups and rivals such as the National Lottery.

Richard Sowerby, group sales and marketing director for Gala Leisure, which owns 168 bingo clubs and 27 casinos, welcomes the report but is uncertain about its practical application.

“It’s purely a set of recommendations at the moment. There’s no guarantee that any of it will be taken on board by the Government,” he says.

Gamcare, which runs a counselling service for gambling addicts, wants two compulsory rules introduced for advertisers: that they should not suggest that punters can get out of financial difficulty by gambling, and that an “appropriate message” highlights the fact that money can be won or lost.

But the charity is in general in favour of change. Director Paul Bellringer says: “It’s not right that some gambling institutions can advertise and others cannot – this country needs to be relieved of its nanny-state label.”

The possibility of winning multi-million pound accounts has already got many advertising executives salivating. One agency source says: “There could be a substantial amount of cash on the table. We’ve already started sending out company CVs.”

But there are mixed opinions about just how lucrative any change in the gambling laws will be. While most industry experts believe there will be a few multi-million-pound accounts up for grabs, others claim there will be none of the frenzied spending seen during the boom periods of the immature dot-com and telecoms markets.

The question also remains of how the big casino chains will approach advertising. The National Bingo Association, which represents 600 clubs across the country, hired Duckworth Finn Grubb Waters last year to handle its &£5m account. The agency was given a brief to make bingo young and trendy.

But although more than &£35m is won in UK bingo clubs each week, the industry is concerned that it has lost market share since advertising became legal in 1994.

Duckworth Finn Grubb Waters board director Jason Lord believes casinos will handle things differently from the bingo companies.

“I think the big chains will have the valuable accounts,” he says. “They will be trying to get the core players quickly and establish a brand.”

But while there are hundreds of bingo halls across the country, appealing to a wide audience, there are only 113 casinos in the UK. Sowerby suggests this number could double in the next five to ten years, resulting in a more “populist” casino audience flooding to venues such as Blackpool – which has already been dubbed the Las Vegas of Europe.

It is also likely that advertising will be narrowly targeted, using regional press rather than national media. While some industry sources believe that casinos could adopt TV campaigns to dispel the mystery that surrounds its ‘underground’ world, betting shops, they say, are unlikely to warm to television advertising.

But perhaps the real challenge will be developing distinct gambling brands that can be differentiated from their competitors.

Simon Burridge, chairman of HHCL Group and former chief executive of the People’s Lottery, uses the bookmaking sector as an example.

He says: “William Hill and Ladbrokes offer the same product but under a different logo. Their advertising is based on odds-related advertising rather than brands.”

Burridge believes television advertising for betting shops could be used to entice new customers by holding “open days” tied in with prestigious events such as the Grand National and Ascot.

But he warns that overzealous advertising could backfire. Betting shops are already attempting to lose their image as dark, smoky dens of iniquity by revamping their premises. The flood of extra customers generated by advertising could recreate the very atmosphere they were trying to get rid of and, ultimately, put punters off.

While the gaming world stands on the brink of striding confidently into the 21st century it will be waiting with bated breath for some time yet. Sir Alan’s recommendations are sure to come under heavy scrutiny from the Government, so for many in the gambling industry the roulette wheel is still spinning.

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