Basic About Creation and Promotion of a Betting Shop
Sportsbook has become almost the only legal option for gambling in Russia, although here the regulatory authorities are doing everything possible to complicate the lives of owners of betting shops. Therefore, before opening a betting shop, we recommend that you carefully study the legislation in this matter.
It should be said from the outset: it is difficult, but not impossible. Moreover, all the spent efforts paid off more than in the first 10-14 months. According to the Russian state statistics service, the total annual turnover of bookmakers exceeds $3 billion. So, it only depends on you what piece of this pie will be on your plate.
There are several advantages of owning a bookmaker’s office:
- after the launch, the betting shop can be managed remotely;
- this is a highly profitable business;
- brings profit immediately after the start of operation;
- has great potential for development.
Although, you have to teach yourself a lot of things, yet something can be handed out to the work of contractors. For example, advertising of betting shop brings more results when it is prepared by professionals.
Much depends on the form of your enterprise. Online betting shop is easier to organize, but the gamblers trust practical bookmakers more. And the process of opening these two types of business is very different.
Therefore, in the article below we will reveal in detail the following aspects:
- how to prepare a business plan of the sportsbook;
- what is the difference between land-based and online betting shops;
- what is the betting shop script and how to get it;
- how to organize the work of the land-based sportsbook;
- how to open a franchise betting shop;
- what mistakes aspiring entrepreneurs usually make.
The study of the material will take about 1 hour. But we promise, after that, you will be well-versed in details on how to create a sportsbook from scratch.
Like any other business, the betting shop requires a serious personal touch. Therefore, you should start with the assessment of competitors and the calculation of forecasts, that is, with the creation of a business plan.
The profitability of the bookmaker’s office depends on the state of the market in a particular region. If we talk about the land-based point of betting, the location of competitors and the number of players who can become your customers are quite important. And for the betting business on the Internet, geography does not matter: any site that accepts bets, in theory, can lure away your visitors.
During the planning, keep in mind that the business has a seasonal nature, especially if you focus on sporting events. Immediately after the opening, the income of betting shops comes in spurts, but the tendency is fading away over time. The longer you work, the more regular visitors and the selection of events for betting you have. Therefore, the flow of customers becomes more equable and predictable.
Before you count how much it costs to open a sportsbook, let us deal with the issues on how this business works, what the money is spent on and how the profit is formed.
The essence of the bookmakers’ work is based on the ability of people to assess the situation and predict its results. Betting shops make the so-called line — quotes on the outcome of the sporting event. Each result in the line has its own coefficient, which determines the number of winnings. Often, the whole staff of analysts works in such offices. They collect and process data and prepare their lines.
The difficulty is that there are very few specialists who can accurately assess the outcome of a sports competition or other event. It depends on their professionalism, how much profit the sportsbook brings.
Therefore, the owner of a betting shop has two ways:
- Create his/her own analytical department. Analysts’ services are very expensive. This method requires huge investments but increases the chances of high profits.
- To buy quotes from larger betting shops. This method is good for aspiring bookmakers, but in the long term does not give a competitive advantage.
Getting the line in any way becomes one of the largest fixed expenses of the office. And the amount of your starting capital depends on which way you will choose.
Bookmaking as a business is characterized by a relatively low entry threshold: to get started this activity, you need about 300-400 thousand roubles. The amount is fair for the betting shop of minimal arranging: with the daily purchase of lines, one or two employees, the acquisition of a sublicense.
Main expenses for the betting shop implementation:
1. License for the sportsbook. In Russia, bookmakers cannot work without the permission of the FTS. Therefore, aspiring businesspeople either receive a necessary document on draconian terms (read further in the article) or decide to open a bookmaker’s office by means of a franchise. The amount of costs starts from 200 000 roubles.
2. Start-up organizational costs:
- For land-based betting shop: rent and renovating of premises, purchase of furniture and equipment, outdoor advertising. About 150 000 roubles.
- For online bookmakers: website development, software purchase, SEO promotion, advertising on the Internet. From 100 000 roubles and even higher.
3. Monthly expenses:
- Rental of premises. From 10 000 roubles.
- Staff salary. From 30 000 roubles.
- The commission fee for the use of the franchise. From 20 000 to 40 000 roubles every month.
- Utility, Internet and security payments.
- The costs of promotion. From 0 to ∞.
As you can see, it is possible to open your own bookmaker’s office even with a small budget. The main thing is to understand how to organize the whole work. We will discuss in detail below all the advantages and disadvantages of each way.
The usual rate in the sportsbook is 200 roubles. But it is an average performance. There are players who bet more than 100 thousand roubles. It is important to consider the positioning of each individual betting shop.
Depending on the confidence in their lines, bookmakers usually work for one of two classes of bettors:
- Mass audience. Bets from 25 to 5000 roubles.
- The high-rollers. Bets from 500 roubles and higher, the average bet is 100 000 roubles.
Despite the popularity of betting shops among people and fairly large cash flow, the profitability of the sportsbook is still within 10%. Those points that exist not for the first year and are based on the forecasts of their own analysts, can reach the profitability level of 20%. This figure is considered pretty high.
Bookmakers are passing through a challenging position now: the regulatory authorities have approved such rules for obtaining a license, which are almost unaffordable for an aspiring businessman.
Financial requirements of the FTS to the applicant for the opening of a license for the sportsbook:
- A letter of guarantee from a banking institution on the readiness to maintain the business of 500 000 roubles.
- The capital of 100 million roubles in the director possession or one of the betting shop founders; it is formed only by cash funds.
- Confirmation of the net assets possession in the amount of 1 billion roubles for the whole period of the legal entity existence.
- The company must be a part of a self-regulatory organization of bookmakers or sweepstakes (consisting of at least 10 participants). Each member of the organization is obliged to make contributions to the SRO compensation fund in the amount of not less than 30 million roubles.
You must admit, it is vast sums. But the betting shop cannot exist without a license, otherwise, it threatens administrative and criminal liability.
You can get a license for a sportsbook in the EU or one of the offshore companies. The states of Malta, Costa Rica, Gibraltar and others provide loyal tax conditions, sometimes even issuing licenses under a simplified scheme.
The main advantage of this option is the ability to work in several countries. And if you have ambitious plans, an offshore license will suit you in the best way possible.
The main drawback is, of course, the cost: the license for betting shop abroad will cost $15-20 thousand.
Therefore, businesspeople have found another way out — to become a sublicensee and enter the newly formed company into the existing license for gambling. Thus, you can not only save money but also speed up the launch of the betting shop several times, as the whole process takes 4-6 weeks. And even no longer care about how much is a betting license.
What you need to conclude a treaty with the licensee:
- to register LLC or SE (transfer of sublicense rights is possible in both cases);
- obtain the necessary documentation on the premises: the rental contract, permission from the supervision, confirmation of compliance with all sanitary standards;
- prepare an information package about the founders and employees (if necessary);
- provide a copy of the contract with the security service.
Almost any major betting shop allows establishing a branch under your own brand. This is another way to get started without a license. Besides, it is not the only advantage.
Work on the franchise involves providing the subsidiary with a quality line, technical support, good software and a ready-made advertising strategy. The average price of a franchise varies in the range of 150-200 thousand roubles. while purchasing and another 20-40 thousand roubles need to be paid as monthly fees.
When the issue with the sportsbook license is resolved, you are obliged to register the company as a taxpayer.
You will be required to provide:
- copy of the rental agreement;
- the plan of the premises obtained in the PIRA;
- documentary evidence of consent from the building owner to the organization and conducting this type of business;
- PTRN, copies of passports or other identity documents of the founders.
Bookmakers feel great on the Internet. Work here is easier, simpler, and the cost of starting a business is lower.
Why you should open an online betting shop:
- 24/7 operation. Theoretically, the ground bets-receiving point can also work around the clock. But for you as an owner, that means additional salary costs. The situation with online betting shops is quite different: a lot of made bets take place on working hours, when customers are at work and make bets from mobile devices or desktop computers, as well as at night time. At the same time, no additional expenses are needed.
- Development of a betting website is cheaper than the organization of a physical betting shop.
- Monthly expenses for the business maintenance are in order of magnitude less: you do not pay for the rental of premises and security, also pay fewer salaries because you have minimal staff.
- Your visitors are not only local residents. Bets can be made by people from almost any country in the world.
But there is one significant drawback: it is prohibited to operate officially as a bookie on the Internet on the territory of Russia. But in what way do all the online betting shops work?
There are two options:
- At your own risk.
- Under the license of the offshore state.
You can place the server in another country, and then all that the regulatory authorities can do is to block access to your site. However, the Russians have long been familiar with VPN, and for most players, such blocking is not a problem.
The development of the betting website can be considered as a separate project, as it includes several stages that differ from each other.
What you have to do in the preparation of the sportsbook website:
- select domain;
- pay for hosting;
- select the engine;
- develop a unique design;
- order layout;
- fill the site with appropriate content;
- connect payment systems;
- connect support chat.
In the modern world for each of these stages, there is a separate profession. You can both master of such special skills on your own and hand the site creation to an external contractor: in parts or in a complex.
Do not forget about the mobile version of the site, but rather try to release your mobile application. With its help, bettors will be able to make bets at any time, even at work, even in the subway via their smartphones.
Now it is possible to place sites in domain zones .casino and .bet, created specifically for gambling resources. But traditional .com and .net also work fine. Sometimes they are even perceived as a symbol of internationality of casino or betting shop.
Avoid domains that are hard to remember, especially long and unusual. Unfortunately, you probably will not be able to create a sportsbook website on the domain .ru: it is possible to register only a legal Russian company here.
But these words can and should be used in the address: winner, lucky, fortune, gold, bet and so on. Do not choose Russian words written in Latin. This site address will remain misunderstood for foreigners, and it will be difficult to remember it.
Foreign regulators that issue licenses to conduct gambling activities are meticulous about the way you accomplish your work. Therefore, among the conditions, you can often see the requirement to place servers within the jurisdiction.
But if you decide to work without a license, the hosting country will not matter to you. Rather, the difficulties will appear with the search for hosters who are ready to undertake the maintenance of your gambling site.
Do not skimp on hosting. It is better to overpay for $50-100 more, sleep well and not to worry that any handy hacker can tap into your site.
Another essential point is the overall situation with freedom of speech in the country. For example, it is strongly recommended not to take hosting in Russia, as your site may be closed because of any suspicious activity.
With the design, everything is relatively clear: you need to give the task to the designer who will prepare the layouts of the future site. But what is next?
Layouts are transferred to the layout designer for the further working on. This specialist indicates how the animation of any activity on the site looks like (changing banners, clicking buttons, pop-ups). That is, it is best when the designer and layout designer work in pairs. Then the site interface looks harmonious and finished.
There are several general requirements for the design of the betting shop website:
- Usage of bright colours. It is traditionally an important aspect of any gambling project.
- Availability of information. A variety of information is widely involved on the sportsbook websites. Here are quotes, and coefficients, and match results. Therefore, it is important that the visitor can quickly and easily find the necessary data.
- The speed of operation. The simpler the design is and fewer images are used on each page, the faster they are loaded.
- Modernity. Unfortunately, many sportsbook websites now look hopelessly outdated. It is not desirable to bet on them. Keep pace with the times in the matter of design, and you will be able to attract a young audience.
At the final stage of the betting shop website creation take the time to connect and, importantly, for meticulous testing of payment systems and technical support chat.
New players often make small deposits or less cash out funds, thus checking the honesty of the site and its operation in whole. And only after making sure of the online betting shop fair play, start a larger deposit.
But if you cannot control the work of the payment operator anyway, and even more you will not be able to influence it, then it is in your power to support the gambler at least through your own support chat. It should be admitted that sometimes it is not so important to quickly resolve the issue than to understand that the company is meeting you halfway and doing everything possible.
Therefore, before starting, gauge the support service work, check the payment systems again, and only then begin to attract players.
Bookmakers with the great experience usually choose a betting script, which covers all aspects of the work. This is convenient because it allows combining in one tool an online betting, technical support, reporting, and even connecting data from special terminals and cash registers.
The most important thing is that all these components can be very flexibly adjusted to your own needs and, as a result, get a cool product. And by means of this — easily manage your business.
High-quality software may include:
- the wide range of different events for betting;
- quality quotes for each event;
- competitive odds, very attractive for the players.
All this is necessary to ensure you not be engaging in updating quotes and coefficients manually every day. It is enough to choose a good update provider, and you will remove this issue from the daily agenda.
For the script operation, you need the betting shop engine (CMS site system), as well as to develop the design.
You can find free scripts in the Network. People who share them talk about ease of installation and use. But in practice, everything turns out to be the opposite.
The most common problems with free scripts for betting shops:
- “Leaky” script. It contains many errors, flaws, roughly speaking, holes. You can work on such a script only after rewriting a significant part of the code (as practice shows), which is comparable in cost to create a script from scratch.
- Low level of assurance. Problems with the script can occur much later, after the launch. For example, the developer did not care about the safety of data or resistance to external attacks. As a result, both the players and betting shop could come under the cosh.
- Theft. Think about who will distribute free script, on which was spent a lot of efforts? Just a man planning to make money on you later. You do not know what was laid in the code and how it can be used to steal your (or your visitors) data. In any case, the installation of a free script threatens financial losses.
All of the above can be summarized in one sentence: a good PHP script for sportsbook cannot be cheap.
Software for betting business allows:
- cashier — easily and quickly performing his/her work, serving as many visitors as possible;
- owner — getting a complete overview of the current state of the business and manage the entire system in a few clicks;
- customers — interacting with a bookie without the cashier’s mediation (for online betting shops).
That is, the software must support all operations that occur within the framework of the betting shop.
Hence, there are requirements for what betting software should be:
- Stable. No one wants to see failures, errors, and 5-minute waits for each operation. All functions must be performed in a clear and coherent manner.
- Reliable. Since your work involves money, banking and personal data of players and owners, take care of the protection of this information at the highest possible level.
- License. In this case, the provider guarantees that there are no hidden functions in the software, such as periodic copying of your data or money theft.
- Simple. Clear interface — a guarantee that each of your employees at the betting shops will be able to easily deal with the software.
- With the support of Real Time operation. It allows you to update information on the page instantly, without reloading the site. This is an extremely important feature when betting on the current match.
- With detailed analytical data. Statistics, reports, charts, etc. Anything that can help further understand the work of the sportsbook and find its strengths and weaknesses.
Also, pay special attention to whether your software developer has technical support. Problems or difficulties will arise sooner or later, and you should have a channel to get help. Therefore, choose the provider who even after 1-2 years of work will be ready to come to the rescue.
Dozens of companies from around the world can sell you betting software. Below we have collected the best software providers for betting shops.
Novomatic has been in existence for almost 40 years and specializes in the production of slot games. In 2017, the company’s product pool was replenished with software for bookmakers. As it was expected, the developer with such a long and successful history has created software that immediately attracted the current betting shops. It has all the necessary tools for business management: analytics, reports, support and much more.
The company provides turnkey solutions for gambling business owners. There is not only software for the sportsbook, but also for the casino. Slotegrator offers the betting software with integrated CMS, flexible configuration of bets receiving and a wide variety of sporting events.
It is a well-known manufacturer of virtual gambling software. Playtech software is famous for excellent quality, so it is firmly held in the top of developers. The company managed to create a completely integrated, best-in-class solution for sports betting. At the same time, clients are offered, if necessary, to modify the software in accordance with the customer requirements.
ZenitBet bookmaker with a Qazaqstan licensing. Today the company offers to buy its own software to create your own betting shop. One of the main advantages of this developer is its focus on the Russian-speaking audience. Although other providers also make localization, ZenitBet software addresses some cultural background. This software allows making payments in Russian and Belarusian roubles, hryvnia and tenge, as well as traditional dollars and euros.
SportBet betting shop has appeared in 1997 and now it is a well-known holding 5Dimes in the gaming world. The bookmaker is extremely popular in the US, but players from other countries are also happy to bet with it. As for the software, it differs due to its high quality and active customer support from the developer, and the interface is attractive to residents of any continent.
Software for sportsbook from Olimp betting shop is made by the biggest fans of their business. It is expressed primarily in the ability to make unusual bets. Bettors are available both options: to bet using RNG and to make transactions that require in-depth analysis. It all contribute to the adrenaline rush, and therefore attracts a lot of players from different countries of the world.
Swedish sportsbook Unibet has existed for more than 20 years. In addition to sports betting and gaming slots, it also offers to buy specialized software and become a bookmaker. Interestingly that the Unibet betting platform includes versions for Android, iOS and Windows.
The developer offers software for betting shops, as well as creates interactive games in live-format. The main feature of Betgames.tv is a combination of sports betting and popular board games. The provider has appeared in 2012, but in a short period managed to win the markets of Estonia, Ukraine, Russia, Turkey and other countries.
The company was formed in 2006. Today its arsenal includes software products for gambling, betting and casino. Moreover, Golden Race captures not only land-based gambling clubs but also online resources. The producer has already connected more than 8,000 betting shops around the world.
Golden Race software allows betting on:
- sporting event;
- horse and dog racing;
The developer has a really individual approach to each client. You can not only buy software but also to order additional services: connection of technical support chat, legal and accounting support, training of employees.
Mohio company has appeared in 2009 and is an Austrian-Ukrainian collaboration. Mohio Gaming Competence develops high-quality software for the gaming business, which is certified and licensed worldwide. It is interesting that the company offers software for various types of betting shops: the client can purchase a version to open the sportsbook, betting terminals and even a home version for those who like to play in a comfortable environment.
CRM in the transcript means Customer Relationship Management, and translated into Russian — “Система управления взаимоотношениями с клиентами.” This is a software for bookmakers that can track the activity of customers, considering the bets, monitor the work of the sportsbook, analyse the popularity of certain events, etc.
In brief, CRM is a program for business control. Usually, it comes with betting software.
What quality CRM can do:
- maintain a customer base and records of visits to the site, bets that were made, etc;
- record the history of financial transactions;
- monitor the status of each betting point, which allows replenishing the cash pool in time, conduct cash proceeds collection, determine peak hours;
- prevent collusion between the cashier and bettor;
- compile detailed statistics;
- provide the registered users with email marketing.
It is important that the CRM system can be developed and improved as and when necessary. But this is almost impossible in the case of buying boxed software. Consider the creation of customized CRM as an alternative, because in the long term, any betting network needs an individual solution.
To receive bets online, on your website must be connected payment systems. Unfortunately, not all of them (even the most popular and widespread) cooperate with bookmakers. And considering the recently released law in Russia prohibiting transfers to illegal gambling establishments, the palette of payment cards has been reduced to just a few companies.
What payment operators collaborate with betting shops:
- Skrill. This is one of the best international payment systems that is reliable and easy to use. Used by bookmakers for more than 10 years.
- Neteller. Works in America, a number of Asian countries, and since 2010 even on the Russia territory. It has a good Russian-language interface and focuses on the security of customer data.
- Qiwi. It is the Russian payment system, one of the most common in the country. It allows making transactions not only via the mobile application but also through special terminals, which are more than 100 000 in the territory of the Russian Federation. But it can block transactions to illegal gambling business in accordance with the legislation.
- Webmoney. This is one of the most popular payment systems in the CIS, used in most betting shops. It has an intelligible and intuitive interface. Sportsbook clients can replenish their account via bank transfer, credit card or direct transfer to the betting shop wallet. It often refuses to work with illegal bookmakers.
- Visa and MasterCard. These are the leaders of the international transfers with an excellent reputation. If the betting shop accounts are in a foreign bank and bettor makes a transfer in a foreign currency, such a transaction does not fall under the Russian law on limitation of payments. Payment requires the presence of a license.
One of the most reliable, simple and popular ways to bypass the official payments that can be checked by regulatory authorities is to receive bets in cryptocurrencies.
The loveliness of bitcoins is in their absolute anonymity: no matter how hard the law enforcement agencies try, they will not be able to track you or your customers. Bettors themselves are happy to use the services of bookmakers who accept cryptocurrencies.
Therefore, we strongly recommend connecting the receiving bets in bitcoins.
Players do not like to reveal their personal data: name, registration, bank cards. However, this is necessary for the correct, legal and safe operation of bookmakers, therefore, sooner or later you will also have to take care of setting up verification. Fortunately, experienced players understand why it is necessary, and do not resist it.
Data verification usually involves two stages:
- Receiving bettor’s banking data: card/account number, as well as the name and surname of the owner. Thus, the bookmaker tries to protect himself from claims that from the situation, when the money was not received or transferred on a wrong account. Well, in the case of hacking the account, this information will help to block the withdrawal of funds to the intruder account.
- Receiving registration data, additional information about the person. These parameters are also important for the security of payments but are more necessary to ensure that players do not create multi-accounts. Verification, among other things, allows you to confirm that the client is over 18 years old.
It is difficult to imagine how to create a betting website without content and raise it to the top because good articles, videos and photos serve several purposes:
- help with promotion of the site in search engines;
- teach beginners to bet, dispel the fear of the first deposit;
- increase the duration of users stay on the site;
- help experienced bettors to make balanced bets, and increase naturally their loyalty to betting shops.
Usually, the owners of the office give this part of the work on the portal to external agents, as the preparation of content takes a long time. Especially when it comes to quality content.
It seems that with the advent of the Internet in our lives sports betting almost completely moved to the World Wide Web. But land-based sportsbooks continue to thrive. Why is this happening?
Reasons for the betting shops success:
- Real money. In the online betting shop, you can make a bet only with the use of electronic money (in extreme cases, bank transfer). But the winnings will have to be received on the card. In a betting shop, the cashier will give the player money in cash, and for some bettors, this is the decisive factor.
- Live communication and emotions. For many clients of betting shops, the betting process has become a whole ritual: to come after work in the sportsbook, choose a match, bet the money and talk to the cashier. Online sportsbook will never be able to lure such people, which means that there will always be work for land-based betting shops.
- Legality. While online bookmakers have to operate illegally (or obtain licenses abroad), for physical offices everything is rosier. Today it is possible to obtain a work permit in Russia and carry out legal activities.
Of course, this business has its drawbacks. For example, to open a betting shop, you need to find a suitable space, organize the work of staff and security services, pay rent and salaries on a monthly basis. At the same time, only local residents can become customers of the land-based sportsbook, and the question of the office location becomes very acute. After all, how much bookmakers earn depends on how many people pass by the betting shop.
To start a business, bookmakers definitely recommend renting a space. The reason is simple: the number of visitors and earnings are directly dependent on the location of the betting shop. Sometimes moving a point on 5 meters sideways to the other part of the street increases revenues several times.
The legislation sets some restrictions on where the betting shop can be organized:
- a municipal share should not be in the ownership of the building;
- it is possible to locate the betting shop only in the isolated part of capital buildings;
- there should be no educational or public institutions nearby;
- a separate entrance and a sign with the name are mandatory.
Where to Locate the Betting Shop
9 out of 10 betters are men. Therefore, traditionally, offices are placed closer to potential visitors: it can be sports pubs, bowling or billiards, night clubs, large enterprises, gyms, etc.
In gambling zones, where betting shops can work even without a license, it is better to place the cashier in the casino itself, if you can agree with the administration. External advertising should be made the most visible: with a bright sign in the afternoon and neon lights at night time.
The state forbids betting shops to operate:
- in temporary buildings;
- children’s, medical and cultural institutions;
- at railway and bus stations;
- in all public institutions;
- temples of any religion.
The betting shop does not need much space: at the start, it is enough 5-6 square meters. It can easily accommodate 2-3 visitors, a table and a chair for the employee, cash register, printer, copier and other facilities.
The cashier’s workplace should be organized in a way that customers cannot see the computer screen and were not able to reach the money at the cash desk. The ideal option is to separate the working and client areas. This can be done with the help of a partition or even a close solid wall with a window.
If you want to save the starting budget, consider buying the used equipment. Actually, you do not need the latest technology: it is enough to have a computer that is average the power and intact office automation equipment.
For the betting shop organization, you will need:
- computer or laptop with secure access to high-speed Internet;
- cash register;
- printer for tickets/cards printing;
- the copier to copy the lines;
- tables and chairs for employees;
- furniture for visitors.
The interior is better to arrange in branded colours. It is important to select comfortable furniture: the visitor should feel cosy in the office, feeling the desire to come back here again.
To open a sportsbook, you will need to hire several employees:
- Cashiers. Their main task is to receive bets from visitors, check the quotes and give winnings. It is enough for the beginning to have two managers who will work in shifts. Then you can hire two more employees and organize their work in pairs: one person works only with the cash register and documentation, the other advises visitors and offers them to make additional bets.
- Security. It is best to entrust the safety of business and employees to a specialized security company, which, if necessary, will provide more guards or take partial responsibility for the damage.
- Bookkeeping. The amount of work depends on the overall turnover of your business. If in the first months you do not need a full-time accountant, hire an external specialist.
- Analytics. Bookmakers with a developed network of betting shops often hire their own analysts. These specialists are the most expensive in terms of salaries, but they are also a condition for the growth of income.
- Technical support. Some of the emerging issues can be solved by employees of the software or franchise provider. But large companies usually have to hire a staff of technicians to quickly solve any problems with the equipment.
Only citizens who have attained the age of majority and are officially registered can work in the sportsbook.
If you decide to open a branch of the franchise betting shop, you can count on the help of the franchisor in matters of recruitment. But even if you are engaged in hiring yourself, do not save on wages. After all, the higher the satisfaction of employees with their work is, the higher your earnings will be.
Let us briefly summarize what framework the law establishes for the bookmakers’ activities on the territory of the Russian Federation:
- Compulsory licensing with a bank guarantee in the amount of 500 million roubles and an asset of 1 billion roubles. You can work without a license only in one of the gambling zones.
- Requirements to the premises: it is impossible to organize betting shop in children’s, municipal, social or religious buildings.
- Double verification obliges bettors first to confirm their data at the bookmaker, then at the Centre of Online Betting Transaction Reporting and only then play without any problems. In the case of changing the address or banking details, the procedure must be passed from the very beginning. As a result, many players simply turn to illegal offices.
- The use of cash register equipment. Receiving cash from players shall be done using the control cash equipment, including while working through the terminals.
It can be said that at the moment the Russian Federation sets strict conditions in matters of betting that almost do not give a chance to beginners for appearing in this business.
The best option for the start at the moment is to cooperate with high-level betting shops, that is, work on the franchise.
Brand-new and alternative to traditional betting shops are automated betting stands. It is equal to the whole betting shop in its functionality but requires less space and resources. The possibilities are wide: you can bet on sports and any other major events.
These stands are located in the shopping or entertainment centre, concert halls and restaurants, in the lobbies of hotels and cinemas, as well as any other places of customers concentration.
One of the best manufacturers of betting stands at the moment is the Golden Cup company, and here are the reasons why:
- Minimal costs for starting and managing a business. For servicing one stand it is enough to have 2-3 employees. In addition, there is no cost for security, as the shopping centre usually has its own security system.
- The cost of renting a space is much lower due to its quadrature.
- There is no need to come up with pleasant surprises for visitors in the form of drinks or snacks.
- The equipment can operate in a continuous mode: 24 hours a day, all year round.
- A huge selection of events for betting allows forming your audience of players, different from the customers of traditional betting shops.
Automatic advertising through its own promotion of the Golden Cup brand. After opening the point, your address will be included in all advertising materials, and you will avoid additional expenses.
The company ensures that the number of racks will be relevant to the market volume. This guarantees that competitors with the same stand will not suddenly appear. Thanks to such a personal touch, you will be able to open an alternative betting shop, without fear of whether it will be a good thing.
Golden Cup betting stands have a huge advantage over the traditional betting shops. Now it is time to join this growing trend.
In terms of legal, a franchise is a transfer to a franchisee (subsidiary) the rights to use the logo, brand features, earnings schemes or production standards in exchange for a financial reward.
Franchise operation in betting means a faster time to enter the market. The franchisor helps at all stages: while choosing premises, hiring staff, buying equipment, etc. Companies with a wide network of franchisees assist partners with legal and technical advice, help with the preparation of the necessary documents for the work.
This is a reliable way to earn money, as the parent betting shop itself is interested in your success. The higher the income of the franchisee is, the greater the commission fees it will receive.
The opening of the franchise betting shop costs from 350 thousand to 2 million roubles. Forecasts for payback: six months.
First, let us consider the advantages of the decision to open a sportsbook on the affiliate program basis:
- Short terms. The whole process of launching takes 2-3 weeks from the idea to the first client. At the output, you get a ready-made business under a well-known brand, based on an effective and proven management model.
- The presence of own analytical department of the franchisor guarantees a high income.
- The franchise supplier will independently provide the necessary software, install and configure it properly. In fact, it is a turnkey betting shop.
- From the very beginning, franchisee has customers that are loyal to the brand and, as a result, to this particular point of betting.
There are only two significant disadvantages:
- You have to pay for the use of the franchise. The initial payment will be ~200 thousand roubles, and monthly you need to deduct another 7-15% of revenue, depending on the terms of the contract.
- The agreement with the franchisor imposes certain restrictions. Most often, subsidiaries are prohibited to depart from the marketing strategy, customer service schemes and strictly follow the service requirements established within the network. In addition to this, after the termination of the contract, the franchisor may prohibit you to open a new betting shop in a certain territory and for a specific period of time.
For the aspiring businessman franchise sportsbook can be a good start. Compared to running an independent enterprise, franchisees do not remain alone and lost in an ocean of business full of pitfalls and problems. Let us consider the most popular franchises.
This betting shop was founded almost 20 years ago and up to this day remains one of the most popular. However, many experts are cautious about the reliability of this franchisor. It is all because of the particular specifics of the work, which significantly limits the rights of customers.
But the conditions for the franchisee are more than favourable: ZenitBet offers to buy a sportsbook and undertakes the preparation of documents, legal and accounting issues. Franchisee receives a reliable and well-verified scheme of business development.
It is a successful bookmaker with more than 400 betting shops all over Russia. Although Bingo Boom has a betting license, it does not accept sports betting. Customers of this betting shop bet on the lottery outcomes. It has a fairly high margin to win.
Minimal investment in franchising Bingo Boom — $50,000.
The Olimp company was founded in 2004 in Qazaqstan, and in a little more than 10 years managed to enter the markets of the CIS countries, Montenegro and even South Africa, and also to become one of the most popular sportsbooks in the Russian-speaking region.
Olimp betting shop is characterized by original events for betting. Players can bet not only on the already traditional football but also on unusual sports: rugby, darts and cricket, virtual sports and even bet on the outcome of financial transactions!
Unibet sportsbook appeared over 20 years ago, and over time managed to capture the highest level: the company has four times received the status of “Bookmaker of the year” according to the eGaming Review title, and is one of the founders of the EGBA self-regulating organization of bookmakers, and also strictly complies with all international requirements. Unibet has even signed contracts with Liverpool and Valencia football clubs for advertising purposes. Definitely, franchisees of this betting shop can easily become not only the regional leaders but also break into the international market.
This is Australian betting shop that is well-known all over the world. The company is very popular among the English-speaking audience, so if you are focused on working in the international market, pay attention to this provider.
Betting business is interesting but quite complicated and sometimes cruel. After all, we are talking about big money. Therefore, a newcomer in this business should be triple careful. Based on our own experience, we have identified the three most common mistakes that novice bookmakers make.
At the very beginning of operating any betting shop pass through a great flow of customers during the major championships. At this point, the owner thinks that the business has improved. But if in the world of sports nothing is happening, the number of clients decreases and the income is plummeting.
Solution. Be patient and keep the gambling fund full. Within a year after the betting shop launch the regular customers appear, and seasonality no longer has such an impact.
There are players who are thoroughly versed in the betting business. And they know how to bypass all the tricks of bookmakers or use dishonest tactics. Just a few accurate bets on large amounts and your gambling fund will be at zero. It is extremely difficult to fight them, and some betting shops resorted to a simple refusal of receiving bets from those people.
Solution. If you are opening a franchise betting shop, the provider will probably reveal you the secrets of its own counteraction to dishonest players. Otherwise, study the work of competitors and adapt their strategies.
Unfortunately, competitors may want to hinder your business. There is no fair competition in betting. In the worst-case scenario, ill-wishers can:
- attack your betting shop website (relevant for online bookmakers);
- send several professional players to empty your gambling fund or to bankrupt you;
- damage your reputation by spreading rumours.
The way out. Each problem needs its own special solution, so act situationally. As a preventative measure, you can research competitors’ security systems and adapt their protection strategies.
It is widely believed that bookmakers never lose. But sportsbook is a business, there are also risks and sometimes failures. In addition, the players themselves are also not averse to annoy the office.
It is not surprising that bookmakers in response to such actions block accounts, cut limits on bets or simply cancel them. These are common legal means of combating fraud.
The simplest technique from which any player begins to get acquainted with the world of betting is called a middle. The essence of it is as follows: the player bets on 2, 3 or more outcomes of the event. Therefore, he wins regardless of how the competition ends. In the simplest double fork there are two bets on opposite outcomes of the match (win — lose). If one bet loses, the other will still win.
And with the spread of new technologies have appeared the applications that can compare bets through the open API of betting shops and find such arbitrage situations in a few minutes.
The problem with surebets is that in this way the players make money not only on one particular office but on the bookies in general. Therefore, in the last decade, the betting shops have declared a covert war to the middle-makers: they set minimal limits on bets, thus flushing them out among the customers.
How to figure out the middle-makers:
- they always play on maximal bets in contrast to regular players who bet carefully;
- make new bets without waiting for the outcome of other bets;
- make repeated bets during the day, tracking the fluctuations of the coefficients, while other bettors make only one deal.
In fact, many offices neither like nor dislike the middle-makers, because every second of their bet still loses. How to act in your betting shop in such cases depends on your decision.
Anti-bookie is the program that supposedly can calculate quotes of betting shops. In another option — to calculate the middles between different offices or get insider information that will help to make the right bets.
In fact, these products are created for net earnings: the developer creates some code, sells it to bottom-feeders for big money, but in fact, this program brings no benefit to the player at all and even cannot do this.
Therefore, the owners of the betting shops should not worry about the existence of this kind of software.
But as for the hacking, it can really be a problem for online betting shops or those land-based offices that have decided to buy a betting site.
Hacking of Online Sportsbook
In order to effectively counteract ill-wishers, it is often enough to use licensed software and reliable hosting. The biggest danger is for those who decide to start a business with a free operating system or save on other technical aspects.
Hacking of Players Accounts
As for the players' accounts, it is more difficult. Firstly, there are real programs that are able to pick up the password to the login, especially if you use some simple combination like “000000” or “12345678”.
Secondly, users themselves can provide fraudsters with their data. For example, there are some utilities for “hacking” the betting shops. The developer promises that if you enter the personal account on the betting site via such software, you can cheat the office and earn more. In fact, a person simply enters his login and password and permanently loses access to the account, because then the scammers change this data and withdraw all the money from the account.
All that can the bookmaker do in this case is to warn his customers to closely monitor what data they enter end for what reason.
For the land-based betting shops, the issue of advertising is not as acute as for online projects. You can open the point and earn with those visitors who pass by and decide to drop in. Therefore, it is necessary to start with outdoor advertising: signboards, sidewalk signs at the entrance, banners in the surrounding area.
But with the increase in the betting shops number, there is a need for a large-scale advertising campaign. And here you can use the aid of radio, television, the Internet and even printed newspapers.
For online betting shops, such a set of tools is relevant from the first day of existence.
The Russian legislation has a number of restrictions concerning the advertising of betting business. It is important to comply with all of them because the regulator is hard to monitor advertising airs and happy to write out the huge fines to betting shops.
What Can Be Done in Sportsbook Advertising:
- Advertising of betting shop in the areas of live sports events: on TV, radio, within sports organizations.
- Place ads in print media specializing exclusively in advertising.
- Use accurate data on the riskiness of the game and winning opportunities.
What Cannot Be Done in Sportsbook Advertising:
- To guarantee the winning.
- Release advertisements aimed at young persons.
- Use pictures of people, animals or any other anthropomorphic images in advertising materials.
- Judge people who do not make bets.
- Position winnings as an option of the main source of income.
- Submit false information.
- Say that betting will lead to personal success and/or public recognition as well as popularity and fame.
- Broadcast advertising from 7:00 to 22:00.
Besides, the ads must contain information about the organizer, rules and timing of the drawings, the order and place of winnings payment.
For more information about the rules of sportsbook advertising you can learn from Art. 27 of the “Law on Advertising”.
As you can see, bookmakers are banned much more than allowed. Therefore, the creation of a betting shop is often similar to solving complex puzzles. Nevertheless, creatives manage to repeatedly designed commercials, posters and slogans that not only meet the law but also really capture the attention of the audience.
Non-standard channels for other businesses are also developing. Logos of major bookmakers appear on the sports uniforms of famous football and tennis players. Chants with the names of betting shops interrupt dubbing of favourite TV series. Bright advertising here and there pops up on websites on the Internet.
Opportunities for advertising always exists. The difficulty is rather to come up with a format that does not fall under the limitations of the law. And to make a product different from what competitors use.
Our advice: trust ads to advertising agencies, where the whole staff will work on your task, or offices with specialization on the complex promotion of gambling business. Because two heads are even better than one.
For the development of betting shop is not enough to provide a huge flow of visitors. They can come to your sportsbook or visit your website, but do not bet.
In this case, to increase profits, you need to apply methods of traffic monetization.
For instance, a lot of visitors comes to your office. Especially during peak hours, after the end of the working day. Some of them see a queue of 3-4 people... and decide to go to the next betting point.
How to make the visitors bet:
- Install terminals for receiving bets.
- Add another cashier.
- Invite your visitors to bet on the website or mobile app.
Besides, you can try to attract to the game those people who always pass by your sportsbook. Particular bookmakers try to print out the lines and distribute through the promoter to passers-by.
Monetization of bookmakers on the Internet is more difficult. The fact is that all betting sites have a high level of refuses. This situation takes place when a lot of people visit the resource, but they almost immediately close the tab. The reason for this is quite simple — aggressive advertising.
However, these people can also be lured into the game and monetized. Below we consider how to do it without resorting to advertising tools.
Top 5 ways to promote sportsbook on the Internet:
- SEO promotion will allow your site to appear in search results on higher positions and attract people who are really interested in betting. Thus, the failure rate can be reduced.
- Bonuses. The classic way to interest the cold players who came “just to see.”
- The loyalty program is effective as a method of increasing the average check. If players usually bet 150-200 roubles, then with the help of marketing techniques this amount can be increased several times. For example, the cashback method works well for unlucky players. When the bookmaker returns part of the lost funds, it motivates to try to bounce back.
- The presence on the discussion forums allows creating a positive buzz around your website and to interest the bettors in making bets.
- Affiliate programs are one of the most effective tools and we have left it for last. Huge merit of affiliate programs is that to your site gets the relevant audience that knows what the betting is and is ready to make bets. Use this tool all the time.
One of the factors that hinder the promotion is the ban on advertising of betting services in Google, Yandex and social networks. Difficulties arise during the purchase of the reference mass on the exchanges. That is, traditional methods for other businesses simply do not work.
Of course, SEO specialists find workarounds. One of the most common is to advertise a third-party resource from which all users are automatically redirected to the betting shop website. However, this method may entail sanctions of search engines.
Another problem is the high level of competition. Sportsbook advertising nowadays should be not only bright and attractive but also qualitatively different from competitors. The high demand for suitable advertising platforms raised the cost of advertising. There is only one solution: to allocate budgets and look for creatives.
Bookmakers are faced with the problem of the ageing audience. The adult population are out of habit betting on land-based betting shops, and young people are in leery to make bets on sports. Therefore, the increase in the audience of bookmakers is quite low. But this is a topic for a separate article.
Absolutely all the problems with the promotion can be bypassed. The main thing is to know where the pitfalls are. Forewarned is forearmed.
There is a long and interesting process ahead of you. In this way, it is important to enlist the support of a reliable partner, who can help each stage, take on part of the tasks or advise on the most complex legal issues.
The Rosloto company can become such a partner to you. You can learn more about how to open a betting shop on the Internet or in your city, buy or rent software for betting shops, connect a demo version or issue a franchise from our experts.
We invite you to join Rosloto to begin working on a new successful project!
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