Betting Shops - UK - August 2009

Table of Contents

• Issues in the Market
• Main issues
• Definition
• Abbreviations
• Market in Brief
• Market breaks the £4 billion barrier
• Betting shops in the recession: Surviving, not prospering
• Gambling Act proves a generator of growth...
• ...but freedom to advertise quickly loses its appeal
• Web rivals pose biggest threat to shop trade
• Horserace betting under ever increasing pressure...
• ...but must retain a place in the new betting shop mix
• New audiences difficult to convince...
• ...but better shops and simpler processes could help
• Internal Market Environment
• Key points
• Licensing: Mixed reception for regime change
• Licence applications: Majors enjoying freedom of movement
• Gaming machines: FOBT bonanza starts to slow
• Extended hours: Benefits are location-linked
• Licence fees: Sliding scale set to promote consolidation?
  • Figure 1: Betting shop licence fees, June 2009
• Burden of taxation: Too many calls for cash?
• Or has the market had it easy for too long?
• Technological advances not just online
• Corruption threatening to climb the agenda
• Gambling addiction an all-industry problem
  • Figure 2: Calls made to GamCare, by gambling activity disclosed, 2005-07
• Broader Market Environment
• Key points
• Popularity of sport: Not all fans are natural bettors
  • Figure 3: Any interest in named sports/pastimes, 2004-08
• Multichannel TV creating opportunities and new threats
  • Figure 4: UK multichannel TV penetration, by platform, 2005-09*
• A different recession...
  • Figure 5: Trends in selected areas of discretionary expenditure, at current and constant prices, 1989-94
• ...leaves shop betting more vulnerable...
  • Figure 6: Impact of the recession on leisure activities, April 2009
• ...but well placed to bounce back with the economy
  • Figure 7: Trends in personal disposable income and consumer expenditure, 2004-14
• Upwardly mobile must hang on to their habits
  • Figure 8: Forecast adult population trends, by socio-economic group, 2004-14
• An ageing population: Bad news for racing?
  • Figure 9: Trends in the age structure of the UK population, by gender, 2004-14
• Competitive Context
• Key points
• Gambling market competition intensifies...
  • Figure 10: Gambling activities in past year, all and past-year gamblers, by gender, 2007
• ...with online sector the major threat...
• ...and exchanges bringing biggest changes
• Gambling now an accepted part of the leisure mainstream
  • Figure 11: Consumer expenditure on selected leisure goods and activities, 2003-08
• Strengths and Weaknesses in the Market
• Strengths
• Weaknesses
• Market Size and Forecast
• Key points
• Spending breaks £4 billion barrier
  • Figure 12: UK betting shop market size, by value* and volume, 2005-14
• Will efforts to stand still sap stamina for the future?
• Segment Performance
• Key points
• FOBTs become a major market force...
  • Figure 13: UK betting shop expenditure, by segment, 2003-09
• ...but the boom years are coming to an end
• Can racing' s poor form be reversed?
• Market Share
• Key points
• Market share to be more important than estate size
  • Figure 14: UK betting shop market, by number of outlets, 2009
• Smaller players could be most expansionist
• Companies and Products
• Key points
• William Hill
  • Figure 15: William Hill key financials, 2007-08
  • Figure 16: William Hill betting shops gross win, by segment, 2007-08
• Ladbrokes
  • Figure 17: Ladbrokes key financials, 2007-08
  • Figure 18: Ladbrokes betting shops gross win, by segment, 2007-08
• Coral
  • Figure 19: Gala Coral key financials, 2007-08
• Betfred
  • Figure 20: Lightcatch Limited betting operations, key financials, 2007-08
• Totesport
  • Figure 21: Tote turnover, by segment, 2007-08
• Paddy Power
  • Figure 22: Paddy Power UK betting shops, key financials, 2007-08
• Scotbet
  • Figure 23: Scotbet key financials, 2007-08
• Brand Communication and Promotion
• Key points
• Television' s novelty wears off fast
  • Figure 24: Leading off-course bookmakers' adspend, by medium, 2005-08
• Who Visits Betting Shops?
• Key points
• Very few have the visiting habit
  • Figure 25: Betting shop usage, May 2009
• Older bettors retiring from racing...
• ...as shop visiting remains tied to workday routine
• What Do Visitors Bet On?
• Key points
• Shops still seen as the home of horse racing
  • Figure 26: Activities done at betting shops, May 2009
• A broader focus can create room for growth
• Gaming and betting: Crossover traffic on a one-way street
  • Figure 27: Activities done at the betting shops, by activities done at the betting shops, May 2009
• Appendix -- Broader Market Environment
  • Figure 33: Forecast adult population trends, by lifestage, 2004-14
• Appendix -- Who Visits Betting Shops?
  • Figure 34: Visit to betting shops, by demographic sub-group, May 2009
• Appendix -- What Do Visitors Bet On?
  • Figure 35: Activities done at the betting shops, by demographic sub-group, May 2009
  • Figure 36: Activities done at betting shops, by visit to betting shops, May 2009