Gambling and advertising change is on the cards

Gambling and advertising change is on the cards

The decision to ban gambling advertising and sponsorship in Italy might be the most draconian action taken so far in a market where gambling is regulated but the signals are that other jurisdictions will likely follow Italy’s lead.

Indeed, Italy’s action will certainly be used as evidence to support the arguments of anti-gambling campaigners and politicians in other jurisdictions. In the key gambling markets of the UK and Australia, for example, there is already criticism of the amount of gambling adverts on television and further restriction is only a matter of time.

In October 2018 Ian Angus, programme director for consumer protection at the Uk Gambling Commission, made clear that the status quo would not hold: “We need a proper and constructive debate about gambling marketing and advertising, including sponsorship arrangements in sport. At a time when consumer trust in gambling is at an all-time low, it would be unwise for industry to ignore the hardening public and political mood around advertising. It’s difficult to see how the ‘as is’ scenario is sustainable. Parliamentary questions on advertising are tabled almost weekly, media headlines scream about irresponsible marketing practices, and prominent politicians, from across the political divide, are calling for drastic measures to reduce children’s exposure”.

Australia already bans gambling adverts around sporting events on television but the issue of gambling adverts is still causing argument. An advert for the Everest Cup horse race was projected onto the Sydney Opera House in October 2018 and was criticised for turning the World Heritage site into a billboard for racing and gambling.

Kenny Alexander, Ceo of Gvc Holdings, wants the gambling sector to work together and agree to cease all adverts during daytime sports broadcasts in the UK. He claimed, “The whole industry has come to the conclusion that there are far too many gambling adverts”.

A blanket advertising ban does, of course, save gambling operators some money, which could be helpful in a competitive market like Italy. Proctor and Gamble reduced its digital marketing budget in Q2 2017 by US$ 100 million, with little resulting impact on revenues, suggesting that some of its vast budget was being spent on ineffective adverts.

An advertising ban also hands an advantage to the established brands, those with a continuing retail estate e.g. betting shops, and those that sponsor international events and sports teams that might still be viewed in a particular market.

But this advantage only materialises if the ban is strictly enforced. If gambling companies choose to ignore the ban and face insignificant consequences, then those that adhere to the ban are at a disadvantage.

Sky Bet’s Richard Flint has argued that banning gambling advertising could be counterproductive:
“We’ll study the advertising proposals carefully but think any type of blanket ban removes a key incentive for operators to get a UK gambling licence and therefore could leave UK customers more vulnerable to disreputable operators”.

An advertising ban does little to curtail unlicensed or illegal gambling and might actually assist it if this sector continues to promote itself surreptitiously. As always, when it comes to regulation, governments need to understand the consequences of any action to curtail the promotion of a legal, tax-paying activity.