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COMMENT | Debt With Mates – why corporate bookies are not your friends

The business of bookmaking is booming in Australia, helping prove the maxim that you don’t go broke underestimating the intelligence of your audience.

There are nine ‘must nots’ written into the advertising code which regulates the promotion of wagering in Australia but unfortunately, none of them expressly prohibit treating punters as a bunch of idiots.

One of the most successful tropes of the corporate bookmaking era, the ‘mug punter’ is the central character of nearly every promotion of betting in Australia, be it on racing or sport.

Advertising companies have taken the Aussie larrikin figure, which was so successfully used in marketing everything from World Series Cricket to beer and cigarettes in the 1970s and 1980s, and turned him into a lovable ‘anti-hero’ for the digital betting age.

What’s more, he – and it is almost unfailingly he – is now portrayed, in his idiotic splendour, in company. We are now implored to ‘Bet With Mates’ or ‘Get involved in Mates Mode’.

In one aspect, this ‘socialisation’ of wagering helps normalise betting in a social context by bringing it away from the insular relationship between a punter and his betting apps.

But on another level, it is a commercial model that bookies are so keen to pursue because they are backing in the old theory that a group of men is far more likely to take risks than one man on his own. The theory is that the ‘one-upmanship’ of a social group, particularly a male one, elevates appetite for risk and puts the bookie in an even more profitable position.

Portrayed as all epic moments and high fives, it is a clever ploy, especially considering one of the ‘must nots’ of wagering advertising is portraying peer pressure in a wagering context. These platforms may facilitate peer pressure but do not actively promote it.

All under the guise, of course, of gambling responsibly.

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The joy of backing a winner, marketing gold for bookies and the racing industry alike. (Photo by Vince Caligiuri/Getty Images)

There is no doubt that corporate bookmakers have made Australian racing a much more dynamic wagering environment since the landmark Betfair High Court case in 2008 opened the door for their widespread proliferation.

At that point, the incumbent, Tabcorp, had become listless, bloated and lazy in its years of monopoly and the industry was ripe for a shake-up.

Driven largely by the innovation from the emerging corporate bookmaking sector, wagering turnover on thoroughbred racing in Australia rocketed to $29 billion in 2020/21, twice what it was a decade ago. The share of that generated by corporate bookmakers has grown five-fold.

Such a boom has driven a similar growth in prizemoney, up from $440 million ten years ago to over $800 million today. That has, in turn, fuelled record investment in the bloodstock and breeding industry.

So everybody wins, right?

The advertising and media industries have certainly been major beneficiaries. The gambling industry spent $287 million on advertising in 2021 as compared to $90 million in 2011.

That dwarfs anything that the racing industry spends in its own promotion and as such, the marketing of racing in Australia has been largely driven in the past ten years by the money spent by the corporates. That’s why the way these entities choose to promote wagering is so important.

While racing administrators have long preferred the ‘fascinator and champagne’ set as a means to push the aspirational nature of the sport, what the public are largely seeing is a bunch of blokes in beards sharing their quaddie tips. Make no mistake, the public sees no difference between the promotion of racing and promotion of wagering.

Many of those involved in racing administrations have tied their success to that of their ‘mates’ in the corporate bookmaking industry, enjoying the rising tide as a means of floating their own boats.

The health of that relationship is reliant on the assumption that the end goals of the bookies and the racing industry are absolutely aligned.

However, as much as racing administrators have become accustomed to the flood of cash coming their way, their measure of ‘engagement’ needs to be very different to that of the bookies.

The aim of corporate bookmakers is to make money for their owners/shareholders. They do this by taking money from those ‘fans’ by whatever legal means necessary. Whether it be cutting off winning punters, operating at high margins which rising taxes help them justify, or promoting high-margin products such as multis to the oblivious public, it is a cut-throat industry which necessitates a cut-throat approach.

Corporate bookies have all but killed off the previous racing business model, the parimutuel totalisator, occupying its space with parasitic intent, consuming all the likely tote punters with their best tote products and leaving the racing industry with little option but to lump in with them and hope the ride goes on forever.

But is what started as a shake-up, now evolving into a shake down?

The days of bookies' boards and counting cash are almost a thing of the past (Paul Crock/AFP via Getty Images)

Bookies want losing punters and the best way to achieve this, in a marketing sense, is by making us all feel like losers.

They have built such a formidable share of voice, both through their own channels and a compliant media, that they can now tell us how we should bet.

While the bookies employ sophisticated methods to accumulate data, frame markets and profile winning and losing punters, the public are told by some bearded burbler that it is a simple matter of taking the bookie’s tips. In one advert, a punter is ridiculed for daring to pay a third party for betting information.

This is the absurd reality we have now reached, where taking a tip from a bookie is not only considered good punting practice, but sound advice from a ‘mate’. A mate, mind you, who profits greatly by keeping you stupid.

Even a wagering-induced idiot would realise that creating a generation of losing punters benefits nothing but the bottom line of the bookies and puts the future prosperity of the entire industry in peril.

And that’s why those charged with piloting the racing industry, some of which have floated to prominence off the back of their unfailing belief in the corporate bookmaker revolution and the almighty power of ‘turnover’, must choose their friends wisely as they negotiate what the future of thoroughbred racing in Australia should look like.

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