I want gambling consumers in Britain to be able to enjoy the fairest and safest gambling in the world.
I want National Lottery players in Britain and Northern Ireland to enjoy the fairest and safest lottery in the world and I want the Gambling Commission to be the most respected gambling regulator in the world.
To achieve my aims I need your support, I need you to work together to make sure you are the best - the fairest, safest - gambling operators in the world. I need you to work with us to put your customers, their enjoyment and their safety, at the top of your agenda. I need you to trust that we will deal firmly but fairly with anyone that tries to compete by bending the rules or being non-compliant.
I am Neil McArthur and it’s my privilege to be the Gambling Commission’s chief executive. As I hope you can already see, this year’s conference is a bit different and I hope you will find what I say over the next 15 minutes or so, is a bit different too. I am not going to talk about tipping points or last chance saloons or existential threats. I know that our policy work, our compliance work and our enforcement work has got your attention. The overriding theme of today will be the question: how well do you know your customers?
I want today to be about collaboration. I know that progress has already been made and that work has started in relation to markers of harm, customer interaction and marketing and advertising. Now it’s time to accelerate progress so we can demonstrate tangible outcomes. Making progress is likely to require all of us to change our approach and mindset – and in that spirit I want to start by talking about progress.
By ‘markers of harm’ I mean the activities or behaviours which could indicate a customer is experiencing or is at risk of developing problems with their gambling. Earlier this year we published guidance on customer interaction for remote operators, which set out a list of the types of indicators operators should consider. This was based on a combination of research and current practice among remote operators. We have followed this up with our own workshop around use of data to identify potentially harmful activity, to interact with customers and to evaluate the impact of those interventions. We know that many operators – individually, or collectively – have been working to improve their own systems and processes. Today is an opportunity to look at what has been done and reflect on what more we can do.
We have also made progress in relation to customer interaction. By customer interaction I mean how you, as operators, identify and interact with customers who may be experiencing or risking problems with their gambling. This is an area where we have been leading co-creation workshops that bring together customers, operators and colleagues from the Commission to explore areas of good practice and opportunities to make them even better.
Today is an opportunity to look at this issue in greater detail. I also see an opportunity to make progress on marketing and advertising. We all know that the public debate around gambling advertising on TV is getting louder. Indeed, only last Sunday Sky made announcements about this subject. The questions for today are: Do you really need to wait for government intervention on advertising, when we all know this is a growing issue? What opportunities are there to work collaboratively to take decisive action that meets the public’s concerns? Today is a chance to consider how to re-build trust with the public by changing your advertising strategies.
I have been with the Commission since 2006, which means I know a bit about the challenges we all face when trying to work out how to balance customer choice and enjoyment against the risks gambling can create for some customers and for wider society. I think we all face another important challenge as well - because a lot of what people say about gambling is based on beliefs, or assertion, rather than solid evidence. We all have our own beliefs, beliefs that we hold dear. But however much we believe something, it doesn’t necessarily mean it’s true. We all need to recognise that gambling has some unique characteristics.
Gambling is not just a product like any other – it is a product that is a source of fun for most, but one which can become addictive and cause serious harm. Gambling is also a subject to which people bring their own values, beliefs and opinions to a much greater extent than is the case for other consumer products. Here are three examples to demonstrate the challenge I am describing.
First, given that we still know relatively little about what motivates customers to gamble, why are so many people convinced that there might be a single, silver bullet to keep people safe? Second, and more pointedly, based on our own Annual Assurance Statement work, why do so many operators claim that people experiencing harm primarily gamble with their competitors and not with them? Third, why would anyone assert that the number of problem gamblers is already so low that we have reached a floor and to bring it lower would be disproportionately expensive in terms of both time and finance? Can you imagine anyone seriously running that type of argument in relation to health and safety at work? Could anyone seriously claim that trying to stop people being killed or seriously injured in accidents was disproportionately expensive in terms of both time and money? Why would anyone make that argument in relation to people who experience harm from gambling?
At the Gambling Commission we recognise that there is no simple guaranteed solution to the difficult challenge of balancing customer choice and enjoyment against the risks of gambling-related harm. Our approach is based on the best available evidence and judgement. We don’t ‘believe’ in things. We are not impressed with assertion – however passionately it is made. And we do adopt a precautionary approach when the evidence is not necessarily conclusive. That approach isn’t going to change.
I think it’s important to remember at this stage that there is no such thing as risk-free gambling. Anyone can experience gambling-related problems. And as we all recognise, the nature of gambling brings other inherent risks – such as the risk of crime or disorder. At the Commission, we look at risk through several different lenses. The person. The product. The place. The provider.
Today I want to focus on two of them, people and products. Risk to the person - whether a gambler’s individual characteristics, personal history, playing behaviours or vulnerabilities might increase their likelihood of suffering harm. Risks posed by specific products - what game-based features or structural characteristics might pose more of a risk to customers and therefore a greater threat to the licensing objectives.
Knowing your customer therefore doesn’t just mean knowing the person, in terms of their age, source of wealth, account history. It is also about understanding how they will react to your products. When we look at the growing range and complexities of products, and the changing nature of the market, I think you will agree, this point is even more important.
Over the last five years whilst participation overall has dropped by 19%, GGY has grown by 21%. There is clearly something is going on here. When we just look at online, whilst there has been an almost doubling of online betting GGY (90% growth since 2012/13) we have only seen a 40% increase in participation. Again, that means GGY is growing at a much faster rate than participation, which means on average more money is being taken from each customer. In the same period average (mean) spend per participant for online betting increased by almost one-third. That’s £168 per participant, which for some people may be more than they can afford. All of this is evidence of an industry with a growing reliance upon a smaller number of gamblers.
It’s time for a change of approach.
But before I go on to explore what that change might be, it's perhaps helpful for people to understand a bit more about me so you can understand what motivates me. Work is important to me - I want to be successful. I want to create an environment where all my colleagues can be successful. I want to lead an organisation that lets good, responsible operators be successful.
Work is not, however, the most important thing to me – family is. Like parents all over the world, my biggest hope is that my children grow up healthy and happy. But the world is a risky place; excitement often involves taking risks and I must confess that I have encouraged a bit of calculated risk-taking by my three sons - such as skiing and playing contact sports. I also realise that they may want to gamble – or work in the gambling industry - and I am not against that - BUT I do want them to be helped to make good choices and not be taken advantage of. I am very mindful that at 19, 16 and 12 they are already at a critical age – an age where gambling could pose a significant risk to them. I hear the concerns about the effect of advertising and the concerns raised by groups such as Gambling with Lives and I worry about them on a personal, not just professional level.
I gamble sometimes. I have an online betting account – at least one of you has all my personal data and card details so be careful with it! Back in the days when I could gamble in premises, I sometimes played table games in casinos and slot machines in arcades and pubs. I am interested in gambling and I am interested in learning more about your businesses and the challenges they face and the things your colleagues do to try to provide a service to your customers.
That is why we have developed the ‘Hot Shoes’ initiative – which is an initiative aimed at building even deeper levels of understanding between the Commission and those it regulates. I have already visited The Grand Pier Family Entertainment Centre in Weston-Super-Mare. Earlier this week I visited Castle Bingo in Cardiff. And soon I hope to visit a betting shop and a casino. I am also interested in learning more from your customers directly, from consumer groups, charities and treatment providers. That is why I visited Gordon Moody House in May and later this month I am hosting a workshop for a wide variety of charities on gambling-related harm. We are also looking for other opportunities to meet with customers and with individuals and families affected by gambling.
As I said earlier, I am – and have been – one of your customers. So, what have I noticed? First, whilst I put money into my account to bet on the Grand National, I was immediately having other products pushed in my direction – specifically slots and casino products. I understand that cross-selling is a recognised business practice across many industries. But in the context of gambling, are you really looking after me when you do that, when you know so little about me? You don’t know my financial circumstances. You don’t know how many other accounts I have. The only thing you know is that I have an account with you.
Second, as I had some money back as one of the horses came in, I did play some of the other products and here are some questions. How much do you know about what makes people play on virtual racing, or greyhounds or football? How are you sure those products are fair and safe? How do you know that your customers really understand what is going on in those games? And I say games deliberately, as whilst they are dressed up as betting products, their essential features look a lot more like gaming to me.
How often, as happened to me, do customers win a significant sum on a slots game within a few spins? I am sure it was just luck, but I can tell you that it made me wonder. It made me wonder so much that I withdrew most of it! When I eventually ran the pot down playing blackjack the first thing I was offered was the chance to top up my funds – no ‘are you sure’ messages. Is that really the best we can do?
Third, whilst the money I spent was not much in total – was anyone worrying that I still might not be able to afford it? Did anyone care that I kept changing what I was playing and when I was playing it? It comes back to that question, how well do you know your customer? And to aid us in that task I want to look at some of the data we hold.
What if the world were 100 people? The data shows that in the general population. 41 people don’t gamble at all, 54 people gamble but are not currently problem or at-risk gamblers, 3 people are low-risk gamblers according to PGSI, 1.5 People are moderate-risk gamblers and half a person is a problem gambler. Let’s turn that into a format that will be more familiar to you. It’s 33/1 that a customer is a low-risk gambler. It’s 66/1 that a moderate-risk gambler. It’s 200/1 that a customer is a problem gambler.
Of course, those numbers don’t give the full picture, as the greyed-out people aren’t customers of gambling at all. Our data shows that if the world were 100 gambling customers 91 customers are not currently problem or at-risk gamblers. 5 customers are low-risk gamblers. 3 customers are moderate-risk gamblers and 1 customer is a problem gambler. That changes the odds significantly. It’s 18/1 that a customer is a low-risk gambler. It’s 33/1 that a moderate-risk gambler. It’s 100/1 that a customer is a problem gambler.
Our data shows that if the world were 100 young people - under 25 - with multiple accounts who gamble in lots of different ways 32 are not currently problem or at-risk gamblers. 19 are low-risk gamblers. 24 are moderate-risk gamblers. 26 are problem gamblers.
That changes the odds significantly. It’s 5/1 that a customer is a low-risk gambler. It’s 3/1 that a customer is a moderate-risk gambler. It’s 11/4 that a customer is a problem gambler. Now, I’ve used this data for illustrative purposes. I realise that there are challenges when interpreting all statistics, based on sample sizes and other factors. I also realise that some of the numbers I have given you add up to more than 100. Please don’t get distracted by that – focus on the bigger picture.
I don’t think any of us can claim that statistics like the ones I have just shown or the story you have just heard mean that we have got things right or that we have been successful. You may say that this is only a small slice of the market. But it is a slice of the market that most advertising in the media and online is focussing on. You may say, that doesn’t apply to my company or the sector my company works in. But how confident are you when you say that? And can you prove it, or do you simply believe it and assert it to be true?
The numbers I have just shown you are serious numbers, which indicate a significant challenge. That is why today is so important. That is why it was so important for us to bring you all together to discuss how we can make progress. And that is why it so important that you take the issues we discuss today back into your own businesses and make sure that tangible actions are taken to address the issues of concern.
More than anything: the questions I want you to ponder today are: How well do we know our customers? What more can we do to keep our customers safe?
I have spoken a lot about risks and challenges and I want to move on to talk about opportunities – but before I do it’s important to remember that it is not my role to be your friend. It is not my job to promote the gambling industry. My job is to permit gambling if it’s fair and safe. I work in the best interests of consumers. That doesn’t automatically mean that our relationship has to be adversarial and I do see the opportunity for a change of emphasis in relationships between the Commission and those we regulate.
As I’ve said before, we want to do more to help things go right in the first place. To provide support, guidance and offer a forum for sharing best practice. We want to support the industry in raising standards, not just intervene when things go wrong, and where we are required to act. In practice this means engaging more directly with operators and groups of operators. This might mean that, at times we will have to cut through the maze of trade bodies and come to you directly. In short, we will do what we need to do to promote collaboration and deliver fairer and safer gambling.
So, this is a call to action - a call to action to join the race to the top. A race to put your customers, their enjoyment and their safety, at the top of the agenda for your management meetings, your board meetings and meetings with your investors. A race to approach the minimum requirements we impose as exactly that: minimums not maximums. A race to look for real solutions to the public health issue of gambling-related harm. I am also asking you to trust me and my colleagues. To trust that we will make our decisions based on the best available evidence and judgment, not beliefs and assertion. And, to trust that we will deal with those who want a race to the bottom.
I want to finish where I started. I want consumers in Britain to be able to enjoy the fairest and safest gambling in the world. And to achieve my aims I need your support - I need you to do everything you can to know your customers and keep them safe. If we work together to create the fairest and safest gambling market in the world, we really will have raised standards.
Last updated: 23 August 2021
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