A safe bet

x Sponsored content on Research Live and in Impact magazine is editorially independent.
Find out more about advertising and sponsorship.

Gathering a sample of gamblers can be challenging. Just 16% of the UK adult population have placed a bet in the past 12 months, and only 7% do so on a monthly basis, according to Katherine Feres, head of market data and insight at betting group Paddy Power Betfair.

Feres is one of those 16%, but can only count herself among them since she started at the company in 2013. “I wasn’t a gambler before I joined Paddy Power Betfair but, for me, whatever category you work in you have to experience it as a customer – so now I dabble in gambling from time to time.” 

Feres joined Paddy Power from Procter & Gamble, where she had worked in consumer and market knowledge roles across several divisions, including oral care, feminine care, fragrances and skin care. In February 2016, just two years after she joined, Paddy Power merged with Betfair – but this, and the fact that she had no prior experience of the gambling world, did not feel like a challenge to Feres, thanks to the regular changes in assignments she had at Procter & Gamble.

“Fundamentally, what you are looking for is to understand who your customers are – understand their unmet needs and how you can better deliver products,” she says. “Whether that’s in gambling or oral care, the approaches you take don’t change that much.”

This helps in the case of Paddy Power Betfair, because the customer types from each side of the business are quite different. Betfair clients, explains Feres, are “more sophisticated betters”. 

As a proposition, Betfair has two parts: a traditional sports book that operates in the same way as Paddy Power, and a betting exchange, which is where its business began. The betting exchange appeals to a more knowledgeable gambler because they, effectively, become the bookmaker. They also place much higher importance on getting the best prices and maximising their returns.

Paddy Power customers, on the other hand, tend to be driven by value; are more casual, social betters; and are more likely to be betting on horse racing. The fact that Paddy Power has retail stores – which Betfair doesn’t – adds to the social element of their custom. 

Most Paddy Power customers are also fairly fickle when it comes to loyalty, says Feres. The industry is very promotion-driven and customers will, on average, have three accounts online. This means their key motivators will be ease of use and convenience – they tend to bet using whichever account has money in it at that moment. 

“You can offer them lots of other things, but is that going to motivate them to make a deposit in another account? Probably not,” Feres says. “So it is incredibly challenging to encourage customers to be loyal.” 

The other important thing to consider is that – because of responsible gambling – every employee is very conscious that they shouldn’t be encouraging people to gamble more. 

“For us, our approach has to be: within the wallet that someone has decided to allocate to gambling, how do we ensure they bet that with us, without encouraging them to spend more?”

One of the ways Paddy Power Betfair has differentiated itself is through its advertising and marketing stunts, which have never shied away from controversy.  

For example, Paddy Power was responsible for the UK’s most complained-about advert of 2002. It featured two elderly ladies crossing the road – with a car fast approaching – accompanied by the headline ‘Let’s make things more interesting’ and odds bubbles displayed next to them. Paddy Power claimed they were odds on who would get across the road first, and not on who would be run over. 

In 2010, the company was forced to remove a Hollywood-style Paddy Power sign that it had put up on a hill overlooking Cheltenham racecourse. At 270ft wide and 50ft tall, it was bigger than the original Hollywood sign. 

Then, in 2012, Denmark striker Nicklas Bendtner was banned for one match and fined £80,000 for flashing the Paddy Power-sponsored waistband of his underpants while celebrating a goal at the European Football Championship. Feres says this heritage of disruption was something that attracted her to work at Paddy Power in the first place. 

“I would say the marketing team here is world class in terms of the industry,” she says. “Even just in terms of cutting through, Paddy Power is head and shoulders above the rest of the gambling companies. 

“When you do qualitative research and ask customers if they remember seeing any advertising recently, Paddy Power is always the brand that is mentioned. 

“And people will often play back specifics of adverts that they remember – ads that are now eight or 10 years old, but they’re the things that stick in people’s minds.”

Since the merger of Paddy Power and Betfair, insight has been at the very front of mind for the executives, says Feres. The first project her team worked on was around what the dual brand strategy should be. “Day one of the merger and the question is: what do we do with our brand?” 

Now, that question is more focused on how to tailor the overall proposition to the two customer types. The company is moving to one technology platform for both brands this year, so Feres and her team are working on understanding the targets for the different brands, which products should be offered to each, and how best to tailor them. 

The other key strand of work is that as Betfair is expanding internationally, they are assessing the opportunity of new markets and how to launch successfully. 

Being thrown into the deep end with these high-profile projects has put the team in a great position to showcase its capabilities, says Feres. And the sheer scale of the business – since the merger, it’s a FTSE 100 company – means it is effectively starting from scratch when it comes to insight. 

“Paddy Power had been on a bit of a journey to discover where insight fits best,” Feres says. “When I first joined, there were pockets of insight across the business. I went into the marketing team, and there was a customer intelligence team, a UX [user experience] team and retail analysts. Basically, lots of different people working towards the same goal. 

“We had made a first attempt at centralising that prior to the merger, but it went a step further, post-merger, to bring together everyone who had more of an analytics focus.”

The central strategy and insights organisation at Paddy Power Betfair is now comprised of three pillars: market data and insight (which Feres leads); strategy; and data enablement. 

Feres’s market data and insight team is made up of two halves: insight – which covers the more traditional market research side of things – and a market competitor team, which is very externally focused. This team is responsible for gauging market share, sizing and projections – as well as monitoring industry press and financial updates. The two sides are then brought together to give a holistic picture. 

“We don’t just let the research operate in isolation, but combine the two,” says Feres.

Meanwhile, the strategy team is made up of people who have worked across the business and so are familiar with the operational side of things. This makes them more able to put recommendations in place, using the data provided by Feres’s team. 

Finally, the data-enablement team looks into automating processes, making data more accessible, and getting results into dashboards that colleagues can access without having to consult Feres’s team. And the stakeholders across Paddy Power Betfair, Feres says, are more capable of getting involved in data sets than most other non-research stakeholders.

“We’re quite an unusual bunch in that, because we’re a gambling company, the vast majority of people who work here are highly numerate. So when we get new research partners on board and we’re doing the debrief, they [the agency] will be trying to simplify everything, and I have to tell them they’ll have no credibility with our stakeholders if they do that. Sure enough, usually by the second slide, somebody from our side will want to get into the in-depth workings of whatever model is being presented. 

“I think it’s good as an insight team, because it really pushes us to make sure we are at the top of our game. It pushes us to be better.” 

One challenge that comes with this thirst for data, says Feres, is convincing some stakeholders of the benefits of qualitative research, and reassuring them that it isn’t intended to replace the “good hard quant data” that they feel comfortable with. 

“Those who work with our transactional data will always refer to our quantitative research studies as ‘qual’ – for them, it’s qualitative data because it’s not being done with hundreds of thousands of people,” she says. While Feres might “get away with a sample of 5,000”, her stakeholders tend to prefer one closer to 10,000. 

“We’re helping them understand that they can get as much out of talking to 10 people as looking at what 100,000 people have done.” 

Feres is confident that she and her team have demonstrated there is room for both types of thinking, and that the company will get to a better place because of it. 

One of the demonstrable benefits of the work they have done has been helping Paddy Power Betfair employees ensure they are thinking of the customers’ needs. 

“A lot of people within the company gamble themselves, so they might not always come at it from a customer perspective – they’re coming at it from a personal point of view, and I think that’s a dangerous place to be,” Feres says. 

To tackle this, the company runs regular sessions called ‘Pints with punters’ [see panel]. These involve going to the pub with a group of customers and a group of stakeholders, and chatting about whatever topics are pertinent to the business. 

“This makes sure that, when people come back to the office, the customer is front of mind, rather than people making decisions based on their own judgement.”