Exploring consumer journeys using gambling promotional offers and incentives

Introduction

The Gambling Commission, in partnership with Yonder, commissioned a mixed-methodology research project to expand their understanding of the promotional offer universe within online gambling. The research was designed to explore three core areas:

• how often and in what way marketing and bonus offers are presented by operators to consumers
• how well consumers understand the offers that they engage with, and how this impacts their use of offers
• whether offers are facilitating the movement of consumers across different products and brands, or driving consumer engagement with ‘riskier’ products and exposing them to greater potential of gambling-related harm.

Our research focused exclusively on promotional offers received and engaged with online, through any brand of gambling operator consumers would naturally interact with.

This report outlines findings from both the quantitative and qualitative phases of the research.

Methodology

Both quantitative and qualitative approaches were used, starting with a quantitative survey between 27 June and 3 July 2023, followed by a qualitative phase comprised of a three-day online community running between 31 August to 1 September 2023, and accompanying triads (interview groups of three respondents) between 11 to 15 September 2023.

Quantitative phase

Quantitative research was conducted first to understand the shape of the marketing and promotional offer landscape, and to inform the qualitative approach. The sample was recruited via Yonder’s proprietary online panel and consisted of 1,002 adults (those aged 18 years and over) who had gambled online within the last four weeks.

For this research we excluded respondents who had only gambled on the following activities:

• in-person betting (that is, not online)
• the National Lottery
• scratch cards
• private betting.

The research focused on 6 types of promotional offers and incentives:

• free spins
• free bets
• bets with boosted odds
• cashback rewards
• deposit based offers
• sign-up and welcome offers.

We also captured respondents' Problem Gambling Severity Index score (PGSI), calculated by participants self-reporting the severity of their gambling behaviour and risk to gambling related harm. More information on how the PGSI is calculated is available on our 'problem gambling screens' research and statistics page.

Qualitative phase

To explore the perception, motivations and experience of playing promotional offers, 27 respondents who use promotional offers at least once a month were recruited, stratified by the type of promotional offers they engaged most with. The three-day online community required respondents to upload video content showing how they receive and interact with promotional offers, and gather top-level, in-the-moment perceptions. This was followed by 5 × 90-minute sessions with three respondents per session to discuss their attitudes towards and experiences with offers, and to explore whether offers influence their gambling activity.

Limitations of this research

We targeted a specific sample of gamblers that we felt would be most relevant to the objectives of our research. The views and experiences voiced by our sample may not be reflective of the wider gambling community. Our qualitative screening criteria specified participants must have used at least one form of online promotional offer within the last month, so this research excludes views of consumers engaging with promotional offers less frequently, or those who have never engaged with them. Our insights are based on self-reported behaviour rather than observed behaviour, meaning insight is limited to what participants felt comfortable revealing to us in the research setting.

Summary of findings

Consumers are likely to be exposed to promotional offers on a frequent and recurring basis, with 9 in 10 of our quantitative respondents having received an offer in the last 4 weeks. 76 percent of respondents who received an offer went on to use the offer, with variation by offer type. Free spins and bets were most frequently received and used, with free spins 10 times more likely to be used than any other type of offer. Respondents generally perceived these offers to be without risk, defined by a lack of staking requirements that encouraged a “play now, think later” mindset. Marketing of free spins and bets as ‘daily offers’ can also lead to consumers believing such offers should be engaged with recurringly, and indeed these offers were frequently being used by our consumers.

Risk

Requirements to stake one’s own money is the key trigger to recognising higher risk, resulting in deposit-based offers, cashback rewards and sign-up offers showing lower up-take rates amongst our quantitative consumers compared to free spins and bets. Consumers use their own selection criteria to determine whether an offer is worth playing, based on their expected likelihood to meet wagering terms or staking requirements, and their previous experiences of winning or losing.

Promotional offers were seen as highly valued features within gambling, felt to be "on the gamblers' side". Consumers likened using offers to ‘finding the best deal’ as they would in other commercial sectors, believing gambling operators to be advertising their best odds to win their custom in a highly competitive market. Consumers felt valued through receiving promotional offers and that offers can even facilitate safer gambling practices by allowing prolonged gambling periods whilst staking less of their own money.

Our qualitative consumers contested the view that their use of offers could expose them to greater risk of gambling related harm. However, the effects of using promotional offers on their subsequent gambling did suggest there is some potential for heightened risk, which consumers may fail to recognise. Despite respondents recognising the following behaviours, they rarely connected them as being a direct result of engaging with promotional offers.

The urgency to meet wagering requirements within an allotted time can drive longer gambling sessions and consumers may engage with offers despite knowing wagering requirements are high and that they are unlikely to fulfil them. Wins from promotional offers were typically reinvested into placing more bets to improve consumers’ total return, rather than being cashed out.

Offers enable consumers to continue gambling beyond their usual stopping point, wherein their gambling budgets have been depleted. This can result in consumers therefore increasing their overall monthly gambling activity.

Offers can encourage riskier bets that individuals may not otherwise consider. This was due to the lack of staking requirements being viewed by consumers as a ‘free opportunity’ to win challenging bets with reduced personal investment, but our consumers didn’t always account for money they needed to deposit to meet future wagering terms.

In some cases, offers lead to consumers exhibiting gambling behaviour outside of their typical pattern or routine, resulting in them gambling at times they wouldn’t usually, when they perceived offers to have the best chance of yielding positive outcomes (in online casino games).

Types of gambling

The quantitative results showed that respondents tended to take part in multiple types of gambling. Throughout this report, we refer to their main type of gambling (that is, the product they engage with most regularly) as their ‘primary gambling type’, and gambling products they have more recently started to participate in as their ‘secondary gambling type’.

Promoting offers across different gambling activities may be exposing consumers to new gambling products they would otherwise not have considered using.

Initially, engagement in secondary gambling types is rationalised by consumers as a way of funding (or prolonging) their primary gambling type. A common example of this was a regular sports bettor engaging with a promoted free spin for a casino product, in the hope of winning a free bet or credit to use on sports betting. However, rewards gained from promotional offers may only be redeemable on specific gambling products outside of the consumers’ primary gambling type. As a result, some consumers were motivated to use their ‘free’ reward on these secondary gambling products which can result in continued engagement. Over time, consumers appeared to engage in secondary types of gambling even without the use of an offer.

Consumers appeared emotionally disconnected from their secondary gambling types, often lacking enjoyment, understanding, and control in the gambling they were participating in through cross-sold offers.

Offers seem to complicate a consumer’s ability to mentally account for losses if they engage with multiple gambling streams and create separate budgets for each. This can lead to consumers losing track of money they have personally invested versus ‘bonus balance’ money credited as part of promotional offer. This was most evident when consumers were required to subsequently stake their own money to meet a promotional offer's wagering terms, then struggled to determine how much money they have personally staked against how much they ultimately earned through the rewards of the offer being used.

Any future regulatory intervention in this space should consider consumers’ strong advocacy for these features, believing them to be a positive element of their gambling experience and failing to acknowledge the greater potential for risk, compared to their gambling behaviour without using a promotional offer.

Consumer exposure to promotional offers

Around 9 in 10 respondents recalled receiving any promotional offer in the last four weeks, with recall of free bets, free spins, and bets with boosted odds being received most often. The majority of offers (57 percent) were received when actively browsing gambling sites, although receipt of offers via email, in-app prompts, and social media reflected the most common ‘passive’ channels in which they were received.

Figure 1: Recall of offers

Types of offer	NET: Seen (percentage)
Any offer	90%
Free bets	74%
Free spins	72%
Bets with boosted odds	70%
Sign-up and welcome offers	70%
Deposit based offers	62%
Cashback rewards	47%
Any other offer you can use online	47%

Despite most exposure to offers occurring passively, over a quarter (26 percent) of respondents were actively searching for them online using a search engine, particularly younger audiences (aged 18 to 34 years).

Third-party ‘tipping’ websites and social media gambling influencers are commonly used to guide this more active pursual of promotional offers. Sign-up offers reflected the offer type that consumers were most likely to actively search for using search engines.

Figure 2: Offers seen by channel (in the last 4 weeks)

Offers seen by channel (in the last four weeks)

Type of offer
Channel	NET: Any offer (percentage)	Free bets (percentage)	Free bets (percentage)	Bets with boosted odds (percentage)	Sign-up and welcome offers (percentage)	Deposit based offers (Percentage)	Cashback rewards (Percentage)
Whilst browsing or gambling on a company website	57%	34%	33%	37%	31%	34%	28%
General email from a company tailored to you	50%	27%	30%	24%	31%	28%	31%
Personalised email from a company	46%	27%	26%	24%	22%	26%	27%
In-app prompt	45%	28%	27%	29%	17%	22%	25%
On social media	44%	23%	23%	21%	34%	28%	26%
App push notification	35%	18%	17%	21%	15%	17%	26%
Text message	29%	13%	14%	13%	13%	16%	15%
I used a search engine to actively look for offers	26%	10%	10%	9%	17%	13%	15%

Consumer understanding and engagement with promotional offers

Around 76 percent of respondents who received an offer went on to use it. Free bets in particular had the highest conversion rate, with nearly 6 in 10 respondents going on to use these offers having seen it.

Figure 3: Conversion of offer receipt to offer up-take (in the last 4 weeks)

Conversion of offer receipt to offer up-take (in the last 4 weeks)

Conversion of offer receipt to offer up-take (in the last four weeks)

	Type of offer
Status	NET: Any offer (percentage)	Free bets (percentage)	Free spins (percentage)	Boosted odds (percentage)	Sign-up (percentage)	Deposit-based (percentage)	Cashback reward (percentage)	Any other offer (percentage)
Seen	90%	74%	72%	70%	64%	62%	47%	47%
Offer taken	76%	58%	52%	53%	27%	31%	38%	29%

What consumers think of promotional offers

Despite variation in the up-take rates of different types of offer, offers were viewed positively as tools that enhance consumers' play or betting experience for both practical and emotional reasons.

Practically, consumers genuinely enjoy the act of gambling, and believe that offers enable them to do more of it whilst using less of their own money. Although rare, consumers had experienced what they considered to be significant financial reward from playing offers previously, and this was used to rationalise their continued engagement. Barriers to accessing the financial rewards of a promotional offer such as wagering requirements are accepted as part of the challenge, and consumers feel confident navigating which wagering requirements are acceptable or achievable.

Emotionally, offers were viewed as tools that facilitate consumer empowerment. Consumers felt valued by receiving promotional offers, as if their loyalty and continued custom was being rewarded. Consumers rarely consider how operators are benefiting from providing offers, believing they are simply promoting their ‘best deals’ in a way to remain competitive within the market.

How consumers decide which offers to use

The decision of which offers are worth playing was driven mainly through an offer's perceived risk and potential for winning returns. This is calculated by factors such as staking and wagering requirements, and previous experiences of wins and losses.

This decision-making process can also be explained by System 1 and System 2 thinking, a behavioural science concept that details how human decision-making occurs. System 1 thinking is characterised by fast, intuitive and automatic decision-making, requiring little effort and driven by instinct and experience. System 2 thinking, however, is defined by slower, deliberate and logical decision-making, requiring greater analysis reserved for more complex tasks. This concept is not exclusive to gambling but is highly relevant in understanding how consumers may determine an offer’s appeal and worthiness to engage with.

Free spins, free bets, and bets with boosted odds

Free spins, free bets, and boosted odds were widely considered by consumers to be without risk and reflected a constant feature throughout their gambling journey. Such offers are advertised most frequently and are judged by consumers to have little additional risk over their regular gambling activity (that is, gambling done without use of a promotional offer).

This perception is based on the understanding that a consumer will not need to stake their own money, or not stake more than they would be prepared to do so without using a promotional offer. There are limited "friction points" within these offers which may stop consumers from analysing the quality of an offer. The straightforward mechanics of free spins and bets in particular, are familiar to all types of gambler, promising instant reward and the potential to prolong their gambling (through the offer’s reward).

System 1 thinking is highly evident within the mechanics of free spins and bets, whereby offers are taken up by consumers automatically and often used to kick start their gambling routine. Furthermore, free spins and bets incorporate fast gameplay, promising potential of a quickly realised bet outcome with minimal risk associated.

The marketing of free spins and bets tap into System 1 decision-making. The language used in marketing of such offers strongly suggest these offers should be engaged with immediately, by framing offers as ‘daily spins’ or encouraging consumers to ‘try again tomorrow’. Marketing language can also reinforce belief that engagement is genuinely free, despite some offers having wagering requirements. Consumers felt the highly gamified imagery within casino games can lessen the perceived risk of offers if they seem similar to "child-like" games, where the enjoyment of the playing experience is prioritised above the potential to win money. The prospect of prolonging the time they are able to gamble for without staking as much of their own money is a key driver to consumer engagement.

Sign-up offers, cashback rewards and deposit based offers

The requirement to stake one’s own money triggers more considered and selective engagement with certain offers, reflected by a lower conversion rate for sign-up offers, cashback rewards and deposit-based offers (as depicted in Figure 4), indicative of System 2 thinking.

For these offers, consumers are forced to think more deeply about how much money they will need to stake immediately and in the future, to meet wagering requirements to become eligible for offer rewards. Previous experiences of wins and losses can be highly influential in their decision here, and over time engagement with these offers is likely to decrease and become more selective.
Consumers cited cashback rewards as an offer type having the greatest potential for harm, as the perceived ‘safety net’ of receiving cashback on losses encouraged them to make riskier bets that are less likely to win. With experience, cashback rewards tended to be used more selectively as consumers recognised recouped losses were insignificant in comparison to their cumulative losses. However, less experienced consumers appeared more likely to engage with these offers, believing any return on a lost bet to be appealing. They felt by using cashback rewards, they were practicing safer and more responsible betting.

Similarly, deposit-based offers appealed to consumers wanting to stake fixed amounts, to allow better tracking of gambling expenditure. For these individuals, up-take was driven by the prospect of prolonged gambling periods relative to the amount of money staked, appearing to have greater appeal to less-experienced gamblers wanting to ‘learn the ropes’ of gambling. However, wagering requirements are well-known to consumers who exercise increased caution on this factor to determine whether an offer is worth playing.

In contrast, sign-up offers were considered by consumers to be one of the best promotional offers available. Promising significantly improved rewards and lower staking requirements than deposit-based offers, respondents reported having signed-up to multiple gambling sites to take advantage of them. In some cases, consumers had exhausted all possible sign-up offers and had accounts with every gambling operator known to them. In extreme cases, consumers reported using friends’ or relatives’ information to create additional accounts to take advantage of sign-up offers. Consumers are likely to demonstrate a natural decline in their use of sign-up offers, due to there being less of these offers that they are eligible to receive. Whilst there was recognition that the creation of multiple accounts further increases the quantity of other types of offers received, consumers rarely considered this to be a negative consequence.

Engagement with offer Terms and Conditions

The majority of consumers agreed that Terms and Conditions and offer characteristics are clear, with some indications that deposit-based offers and cashback rewards are slightly less clear, with the greatest potential to be misleading.

Figure 4: Understanding of the offer most recently taken up

The corresponding chart shows the proportion of consumers agreeing that each statement was clear to them.

Understanding of the offer most recently taken up

Understandings of the offer most recently taken up.

Offer characteristics	Proportion of sample that agree with each statement (percentage)
What the rewards or benefits of the offer were	81%
Which games could be played or which bets could be made with the offer	78%
How much of my own money I was required to spend when using the offer	77%
The timeframe in which the offer had to be used	77%
What the process for withdrawing the prize money was	71%
None of these	5%

Respondents admitted to rarely reviewing the Terms and Conditions when engaging with promotional offers. They’re confident that their previous experience playing offers and general understanding of gambling is enough to safely navigate them, and they believed that Terms and Conditions tend not to vary considerably between types of offers, or between gambling operators.

However, there was a consensus amongst our consumers that the Terms and Conditions are inaccessible and not user-friendly: appearing complex, long-winded and often hidden from users who may want to read them thoroughly. Despite this consensus, any improvements to the accessibility or simplicity of Terms and Conditions seemed unlikely to result in consumers reading them more.

Despite limited concern for reading the Terms and Conditions, within the qualitative stage there were reports of having been ‘stung’ by wagering requirements in the past, with some offers considered to have the potential to mislead. Some wagering requirements appear unachievable and can result in longer gambling sessions, as consumers attempt to meet the terms in one sitting. The details of which games can be played to fulfil wagering requirements, or the time frame in which offers must be completed can also be misunderstood, resulting in some consumers having unexpectedly found themselves ineligible for rewards.

Although negative experiences with wagering requirements are common, consumers appeared to take accountability for not reading the Terms and Conditions properly themselves, rather than placing fault with the gambling company. Consumers will typically form their own standards for what are acceptable wagering terms, however standards varied considerably amongst our consumers.

There were also instances of individuals feeling misled after trying to take advantage of a sign-up offer, only to find out they already had an account with a partnered or parent gambling site and were therefore ineligible for the advertised offer. Whilst frustrating, this did not impact their perceptions of sign-up offers and consumers assumed responsibility for not properly reviewing the Terms and Conditions of the offer.

Impact of promotional offers and potential for gambling related harm

Consumers strongly contested the view that promotional offers negatively impact their wider gambling behaviour. Gamblers, by nature, are accepting of financial risks associated with betting or playing, and the prospect of winning big from a small stake is the primary driver for regular gambling, with promotional offers capitalising on this concept.

Despite consumers' view, we observed some potential for gambling related harm when taking a broader view of their gambling behaviour resulting from using promotional offers, however respondents themselves rarely recognised promotional offers as being the cause for these behaviours.

Promotional offers seemed to be driving consumer engagement with a wider range of gambling activities, outside of what they would normally participate in. Operators advertise promotional offers that are unrelated to the consumers’ main type of gambling. Initially, consumers justified their engagement with newer, secondary types of gambling as a way to fund their primary type of gambling.

However, we observed that these secondary types of gambling still represented a relatively large portion of their total gambling routine and were being engaged with, even without using a promotional offer. This could suggest that promotional offers act as a gateway to secondary types of gambling. This was most prevalent amongst sports gamblers becoming involved in casino-based games, but did also occur the reverse way.

Consumers recognised these different types of gambling (that is, sports and casino products) have vastly different user experiences, with online casinos’ gameplay having less of a social aspect (in that they are typically played alone) and faster speed of play as game outcomes are realised instantly. The gamified nature of online casinos means the gambling experience is entertaining and appealing in itself. In contrast, consumers reported that the enjoyment from sports betting comes from the sporting fixture, with gambling being used to enhance this experience. The potential for financial return with online casinos is understood to be built on luck rather than expertise.

Consumers rarely associated themselves with their secondary type of gambling, especially if participating in it was misaligned with their primary reasons for gambling in the first place. Secondary types of gambling were being engaged with, despite respondents lacking:

• full comprehension of the offer or game
• previous experience with this form of gambling
• personal enjoyment in the type of gambling.

Engagement with online casinos that is being driven by promotional offers has a greater potential for risk, as our consumers’ experience developing responsible gambling practices and familiarity with sports betting had less relevance in this new space. There is potential for consumers to gamble more in isolation, betting on automated games where winning is built on luck, and where they will need to show restraint in playing high frequency casino games, as the act of playing is entertaining by itself.

Engaging in multiple gambling streams may also heighten tolerance to loss. Consumers rarely adapted their cumulative gambling budget to cater for the greater quantity of gambling activities they engaged with. Instead, they typically allocated a separate budget for the new form of gambling on top of their original gambling budget, effectively increasing the amount they were willing to lose.

More broadly, engagement with promotional offers seemed to make tracking losses more complicated. Losses from bets that did not require staking their own money were better tolerated, as consumers saw themselves as ‘no worse off’ than they were before. However, they admitted confusion over accounting for how much of their own money had been staked (that is, their ‘real money’ balance) vs. ‘free’ money as part of the offer (that is, their ‘bonus’ balance). Also, money staked to fulfil an offer’s wagering requirement did not appear to always be factored into their mental accounting of losses.

Promotional offers, particularly free bets and boosted odds, may compromise a consumers’ typical rationality and judgement when analysing the quality of an offer, and whether it will yield a positive return. Consumers felt a degree of safety when placing riskier bets using a promotional offer, and likened it to a ‘free hit’ to earn greater financial return, despite acknowledging that the advertised bet was unlikely to win. Generally, engagement with promotional offers appeared to be driving more speculative and riskier betting, where potential for loss is judged to be lesser.

Despite consumers’ strong advocacy for promotional offers and their perceived value to their gambling experience, realised winnings from gambling using promotional offers was generally considered insignificant. As a result, winnings were rarely cashed out by our sample and instead were ‘reinvested’ into placing future bets (often without the use of a promotional offer), where the potential for significant return is greater.

Some consumers had developed irregular routines around when they decide to engage with promotional offers. Some were suspicious about the mechanics behind the offers they engage with, and believed their chances of winning are improved at specific time periods. Online casino games are perceived to ‘cash out’ when less people are gambling (for instance, late at night or in early hours of the morning) and in extreme cases, consumers reported setting alarms to start their gambling routine around these times. This was more common within the online casino space.

In some cases, promotional offers were only being used when consumers had depleted their regular gambling budget for the month, allowing them to continue gambling beyond the point they would usually stop. There is potential for this to accelerate consumers’ cumulative gambling activity, should they attempt to fulfil wagering requirements of the promotional offers that they had started to use the previous month, effectively increasing their monthly total gambling activity.

Conclusion

There are some key overarching considerations surrounding regulatory changes to gambling-related marketing and bonus incentives.

Our consumers were strong advocates of promotional offers, believing them to be ‘on their side’, enhancing their enjoyment of gambling and perceiving them to enable safer gambling practices. These consumers reacted negatively to the concept of these offers being altered or taken away from them in any way and may push back on regulatory interference.

Consumers may not engage with content aimed at raising awareness of the risks involved with secondary types of gambling if they do not self-identify with these activities. This creates challenges in reaching this audience. Our qualitative consumers were regularly engaging with multiple forms of gambling (such as sports betting and online casinos), but only identified themselves with one type of gambling that they have engaged with for the longest amount of time.

Ultimately, consumers feel bonuses mitigate gambling risk. Offers are not spontaneously seen as nefarious tactics to get consumers to part with more of their money, but ways to facilitate safer gambling practices and to prolong a consumer’s ability to gamble for less. There is potential to trigger greater consideration of the impacts of promotional offers by encouraging gamblers to question whether they are actually spending more than they would if offers were not available.