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Assessing the LatAm opportunity w/Rob Verdia, Head of Products at Nexiux Solutions

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Assessing the LatAm opportunity w/Rob Verdia, Head of Products at Nexiux Solutions

 

Rob Verdia, Head of Products at Nexiux Solutions, says LatAm offers huge potential, but localisation will be key to delivering engaging player experiences in each market

Latin America has emerged as a key market for online gambling operators looking to expand their geographical reach. It is a sizeable region that offers just as much potential as North America but with much lower barriers to entry.

Key markets such as Colombia, Peru, Argentina and Mexico have embraced regulation and offer a viable environment into which operators can launch their brands and deliver compelling player experiences while still ensuring players are protected.

This is not always the case in North America, where some sportsbook operators have already withdrawn their brands from the US states that have failed to deliver the ROI they were expecting.

But it is important for operators to understand that this is a market where localisation is the difference between success and failure. LatAm should not be seen as one jurisdiction, but rather as multiple markets with each requiring its own approach and proposition.

This is because each country is different. From regulation to smartphone prevalence to internet availability, preferred sport and popular payment methods, operators must localise across these areas and more if they are to engage consumers and meet their expectations.

Operators must also be mindful of the nascent nature of these markets. Regulations and requirements can change at a moment’s notice, and they must be able to adapt instantly if they are to remain compliant.

This throws up plenty of challenges for operators. Some are standard to when operating in multiple markets, but others are unique to Latin America – in particular, payments and the popularity of cryptocurrencies such as Bitcoin as a preferred payment option among players.

Let’s take a look at some of the main challenges operators face when setting their sights on markets across the region.

Changing regulatory requirements

New and emerging markets often launch with a regulatory framework that is then tweaked and tightened once operators go live. For those that are first to market, this can mean they are aiming for a moving goalpost in the early days when it comes to ensuring compliance.

It’s also common for tax requirements to be altered as markets mature; this is something we have seen in African jurisdictions which can impact the viability of the market.

This is why operators need to ensure their brands are powered by agile, flexible platforms that allow them to jump in and make the changes they need to meet evolving requirements, often with very little notice.

Internet bandwidth and smartphone penetration

In emerging markets, it is often the case that internet bandwidth is low, data costs for consumers are high and the prevalence of smartphones moderate at best. This means that operators cannot offer the same “bells and whistles” experience as they do in more established markets.

This can mean stripping back the user interface and removing features and functionality such as streaming so that players can place wagers and spin the reels without that core experience being impacted by glitches, slow loads or the book or casino simply crashing.

Again, this requires a platform that offers high levels of flexibility and customisation.

Different player preferences

It goes without saying that player preferences differ from market to market. This is even the case in established regions such as Europe where the sports and games preferred by players in, say, the UK, are entirely different to those in, say, the Netherlands.

Latin America is just the same. Players in Mexico will be drawn to different sports and slots than those in Argentina. Understanding these player preferences is therefore vital, but so too is being able to localise markets and odds, and the providers/games made available to players.

Localise payments and digital currencies

When it comes to localisation, payments are one of the most important areas for operators to get right. If players can’t deposit via the methods they want to, they are highly likely to drop off and switch to a rival brand that does.

In Latin America and other emerging regions, this includes being able to deposit and withdraw using cryptocurrencies. This trend is not so strong in more established markets, but we are seeing a lot of players in LatAm want to use digital currencies for online gambling activity.

To be able to facilitate these payments, operators must ensure their platform can easily integrate new methods into the cashier.

Having considered the key challenges operators face, it’s clear that the platform they use to make moves in Latin American markets will ultimately be key to their success.

At Nexiux Solutions, we believe that modular, dynamic platforms and technologies must be used as the foundation for operators making a play in markets such as Latin America, North America, Africa and Europe.

This allows operators to integrate best-in-class third-party providers that specialise in delivering features, functionality, data, games, payments, etc for specific markets. This in turn allows them to provide a truly localised player experience.

Such is the opportunity presented by the LatAm region, operators must get their platform and tech stack right from the get-go. Dynamic and modular really is the only way forward and will ultimately prove to be the key operators need to unlock each market.

Interviews

Social media: the new frontier for betting engagement?

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Social media: the new frontier for betting engagement?

 

Since the dawn of the internet, social media platforms have been a great way for people to stay in touch. And as mobile technologies have continued to advance, we’re now more connected than ever. In fact, you’d be hard pressed to find someone who doesn’t have a social media presence nowadays.

From Facebook and Instagram to LinkedIn and even TikTok, social media apps have become a staple of our daily lives. So, it’s no surprise that gambling brands are looking towards such platforms as a means of tapping into new audiences.

We spoke to Allan Petrilli, Managing Director of Acquire.Bet, and Troy Paul, CEO and Co-Founder of SGG Media, to ask whether social media is going to become the next battleground for audience engagement.

 

BetMGM recently made the news after partnering with the social media platform X, formerly known as Twitter, in a deal which has made the operator the first online sportsbook embedded within a major social media platform. In your view, what could this agreement mean for the industry?

Troy Paul: It is a very smart play for BetMGM. If operators want to reach the new generation of gamblers, aged 21 to 40, they MUST establish a solid presence on social media.

Ultimately, social media is where this generation gets their news, sports updates, scores and share content with their groups of friends. Ignoring the power of social media would be a big mistake.

 

Could partnerships with social media platforms be the way forward for gambling operators to reach new demographics of players? If so, what impact could such agreements have on player engagement, and subsequently, player acquisition costs?

Allan Petrilli: Deals such as the one signed between BetMGM and X, or DraftKings and Apple Sports, are examples of sports betting brands getting more creative in how they plan to boost brand awareness and consumer trust. They are deviating away from the more traditional advertising models such as TV and other forms of above the line media.

Focusing specifically on the BetMGM agreement, X is a vibrant, passionate community that is heavily engrained in sports. It really seems like a great fit for what BetMGM is trying to do from a brand perspective.

X is also a hotpot of bettors, and this will ensure they are more heavily engaged with the brand. When it comes to lower customer acquisition costs (CAC), that is yet to be determined, as they haven’t released specifics of the deal. As it always goes, it depends on what they paid…

Troy Paul: Absolutely! Partnerships between social media platforms and gambling operators will be key for those who want to communicate with the more digital conscious bettors. If you then compare this to advertising verticals such as television and radio, social media advertising is also much more cost-effective.

 

Affiliates can be an effective way to engage with bettors across social media platforms. How can gambling companies better use affiliates to build a social media following?

Allan Petrilli: Micro-influencers are becoming more popular than ever as a significant driver of affiliate traffic, and this is due to their strong follower engagement and brand loyalty.

Many affiliate companies have SIGNIFICANT social presence and have already established their own communities. These types of partnerships can effectively give brands access to a whole new demographic of customers in a more organic fashion.

Operators needs to continue to offer their social partners a more organic way to drive traffic, with shareable bet slips, better deep-linking and more thoughtful partnerships. As these partnerships become more commonplace, operators, affiliates and social media partners will need to collaborate much more closely to find the most effective strategies to build new communities.

 

As more operators turn their attention towards social media as a marketing tool, how can they best stand out from the crowd? Could we soon see more brands getting creative with their campaigns?

Troy Paul: Social media should be used to create a COMMUNITY of sports fans, and sports gamblers. You cannot create a community by sending only ads. You must create fun, readable, informative CONTENT and occasionally drop in an ad or sign-up link. Content is King in this regard.

As the sports gambling world continues to mature, the smarter, savvier operators will continue to use social media as a means of retaining their customers and creating a social media-led community of loyal customers that not only enjoy their content but also continue to bet via their brand.

Allan Petrilli: Standing out from the crowd isn’t going to be an easy task. You really need to establish your brand identity. The real question is: who is going to be the Paddy Power of the US market, right?

In the US, I think that so far, we have seen quite a buttoned-up approach to social media. I do expect that to change, but I think that change will be quite slow at first. This is where micro-influencers could play a major role, they could really offer a big win potential for sportsbooks and casinos.

Just from what I have seen, I think that many brands can take a much more localised approach on social media. The power for targeting is there, the time is not to have creative, offers, etc that match the local bettor to better engaged, convert and retain them.

 

With that in mind, what role can multimedia assets, such as video and audio, play in driving brand recognition?

Allan Petrilli: Creative content, along with more engaging offers, are the lifeline of any campaign or branding exercise. Brands need a strong mix of branded video, user-generated content, live and pre-game content, and cross-platform retargeting strategies to get the most out of what they do. It’s all about striking that balance and delivering content that the end-customer finds interesting.

Troy Paul: Video-led content is super important if you want to drive brand recognition. The savvier operators will use platforms such as Instagram, YouTube, Twitch, TikTok and other video platforms to create those communities and establish a solid following. Millennials and Gen-Z have been shown to enjoy this quicker, more engaging form of content so it’s worth tapping into the world of video content.

 

When it comes to promoting odds and betting statistics on social media, how can the industry as a whole ensure that player protection remains at the forefront of any social media activity?

Allan Petrilli: The first thing that sportsbooks and casinos need to do is look at how they are targeting their customers and how they are informing their bettors about exclusion lists. The power is there, it just needs to be used properly.

More educational content is also a very important factor when looking to ensure that responsible gambling remains at the forefront of your social strategy. Throwing around $5000 sign up bonuses without ensuring players understand what they are getting into is a potential issue. That doesn’t always need to be in the ad, but brand should at least be introducing better landing pages and terms for players to be aware.

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Interviews

Mexico in 2024: Committed to the cause

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Mexico in 2024: Committed to the cause

 

Mexican bettors demand localization on a different scale. An American approach to sports betting means they differ from other LatAm markets that have moved to decimal or fractional odds. As the population increasingly embraces a mobile-first approach, Altenar’s Sales Manager, Diego Salas, explores why the provider is best placed to meet the unique needs of Mexican operators in the flourishing market.

 

What is your view of the market at the moment and what makes it so promising?

Over the past three years, Mexican operators have experienced a significant migration from predominantly land-based, brick and mortar operations to an online-focused business model. As a result, more than 70% of sports betting revenue now comes from online customers, with internet and smartphone adoption becoming more widespread across LatAm’s second largest population. The increase in mobile penetration follows the emergence of a younger, more tech-savvy demographic with a median age of 30. They are engaging in sports betting in a more social way.

In keeping with this shift online, we entered 2024 with the release of our white-label mobile app which can be customized and places the sportsbook at its core. Approved across Apple Store and Google Play, it offers accelerated time to market, robust security and options for features such as Early Payout, Bet Builder and Player Specials. The mobile and online channels appeal to a new generation of bettors that require accessible, easy to follow sportsbook products at their fingertips. The app promises an ever-increasing number of sports and competitions with a network of official data partners delivering both quality and speed of data.

 

How does Mexico differ from its neighbouring markets?

Mexico is a distinct market compared to other Latin American countries and stands out due to its diverse sports culture. It is well known that soccer is the most popular sport in LatAm and at least 90% of bets still come from matches. However, in Mexico, bettors’ tastes are more diverse. Football sits among basketball, baseball, and the NFL as highly popular sports.

Unlike some of its neighbours, Mexico uses an American approach to odds, instead of the European decimal and fractional odds format. Altenar anticipated this difference by offering a flexible, localized platform to cater to specific preferences of Mexican players. Its user interface for Mexican players offers an American odds format to demonstrate provide intuitive navigation.

 

What will 2024 look like for Altenar in Mexico?

There can be no doubt that LatAm is a major topic of discussion in the industry. The gates are set to swing open to Brazil later in the year and Mexico itself is awaiting some regulatory updates following the legalization of online betting in 2014. As a result, Altenar acknowledges the need for boots on the ground in the continent.

We have just opened a Uruguay office to ensure we can best serve our operator partners across LatAm. We know it is important to them to access people working in the same time zone, who are integrated in their communities. The office will oversee operational aspects and instil confidence in our partners that they will have a team that is more easily accessible than other competitors.

In March and April, we will be at the IV International Gaming Convention in Mexico (12 – 14 March), SAGSE Latam in Argentina (20 – 21 March) and GAT Expo in Colombia (9 – 11 April). Our priorities at these events will be fostering our partnerships in the market and ensuring we are attuned to the regulatory developments across each country. Brazil and Chile are in the process of developing regulations and we are watching those closely, adapting accordingly. We will also be showcasing our flexible platform and features at these events, including our turnkey solution, SSBT and new tools such as Betting Insights, Bet Mentor and Bet Boost. Events are an invaluable way for us to refine our strategies moving forward and we look forward to meeting people over the next month.

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Compliance Updates

The Art of Staying Compliant w/ Greg Ponesse, Chief Revenue Officer at Compliable

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The Art of Staying Compliant w/ Greg Ponesse, Chief Revenue Officer at Compliable

 

How can operators and suppliers best ensure that they stay on track of ever-changing rules and regulation once they are live in a market?

Fundamentally, it’s about keeping a finger on the pulse of the market and curating a broad network of industry sources to ensure that you are up to date on any new developments. Industry press releases, newsletters and magazines are all excellent places to begin, and getting into the habit of checking regulator websites on a monthly basis is a good next step. In general, regulators maintain open communication with the public concerning new regulations; as it’s rare to have a dedicated contact person from any given agency checking in to ensure that you’ve kept up with any updates, however, it will still fall to you to make sure that you’re keeping current with any changes. Ultimately, it is always the responsibility of the licensee to ensure that it is compliant and, if mistakes are made, there are rarely, if ever, any get-out-of-jail-free cards.

Additionally, building a network of compliance professionals that you can reach out to on short notice can be a huge help, as urgent situations can arise without warning and require you to react quickly. It’s not always possible for every company to field an in-house compliance team that can deal with every request and change, even if that would be very preferable, so having experts just a call away is always a smart choice.

 

Compared with entering a market, how time consuming is maintaining compliance for teams?

While entering a new market is complex, maintaining compliance is equally important, and introduces its own challenges of minutiae and attention to detail. Renewal windows need to be carefully monitored, new regulations need to be constantly observed, and required updates need to be passed on to regulators in a timely manner.

These challenges are true no matter the size of the company in question. A small company could be licensed in 16 regions, with one person managing the process for all those markets. In such a case, that one person would probably need to spend a decent portion of their work days just to ensure that compliance was being maintained across all those markets, even if the individual number of licenses was low. A large company operating in fewer locations, on the other hand, might have thousands of employees and licenses to maintain for that location, and not one of those employees or licenses could be allowed to fall through the cracks. Each license would need to be tracked, and each renewal dealt with in a timely fashion. In either case, maintenance of compliance should be expected to take up a sizable amount of time.

 

Are there common mistakes that occur and what impact can this have on operations?

At the risk of sounding reductive, the most common mistakes are not filling out the application correctly or failing to include the correct documentation. Attention to detail matters so much in the process and taking the time to parse what can often be very complex sets of instructions is critical.

No matter the type of licensure, there is always going to be a large amount of information and documentation required, and making sure that you have all of that information and documentation at the ready before you begin is also critical to your success in the process.

Most simply, you could equate the process to that of buying a house. Everything needs to be in order before you place your bid, or it will fall through and someone else will likely swoop in and take the house right out from under you. It’s more or less the same when a company is going through the licensing process. If everything isn’t in order, you might have to wait a long time after submitting your initial application just to be told that something is wrong or missing. Once those issues are corrected, you would have to resubmit the application, starting from the back of the queue again. This would obviously delay the issuing of a license in an industry where first-mover advantage is crucial.

 

How can tech solutions help teams stay compliant once they are live in a market?

There are many ways in which such solutions can assist with compliance. Our platform, for example, allows you to input all of your information and upload all your documents exactly once, and to then output that information to multiple forms at the same time. It also tracks the application status, which can be very challenging to handle on your own if you are active in numerous regions or have a lot of employees. Furthermore, it reminds you of expiration dates, so you can be well prepared and organized when the time comes for renewals. Finally, because we store your information, you are also not required to re-enter all of your information year after year, making the renewal process much more efficient; you will only have to update information if the regulator has changed their forms, otherwise, everything will slot right in where it belongs.

We put an immense amount of effort into ensuring that our forms and other documents are kept up to date with all regulatory requirements and guidelines. Thus, when you use our service to generate forms for any application or renewal, you can be assured that you are filing the correct forms, and that all the questions on that form have been filled out correctly. In short, using our platform ensures that compliance teams can focus on other important tasks while resting safe in the knowledge that their licensure forms have been completed correctly, and that their licenses and renewals are being effectively tracked.

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