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Betting Shops - UK - April 2016

“A slower-growth future for gaming machines is giving bookmakers a new imperative to revitalise the declining sports betting side of their business. Bringing online products into betting shop settings is a good starting point but greater use of mobile looks the key to longer-term success.”
– David Walmsley, Senior Leisure Analyst

This report discusses the following key topics:

  • Can self-service succeed alone?
  • Should shops appeal to punters’ heads or hearts?

Expanding gaming machine revenues continue to compensate for declining over-the-counter trade and keep the UK betting shops market in growth, but a range of structural, regulatory and taxation changes predict a slower future for the segment.

In response, operators are looking to revitalise sports betting by bringing online products into the retail environment as part of wider efforts to strengthen brand loyalty through ‘omnichannel’ play.

The self-service betting terminals through which this convergence is being achieved have an immediate role to play in introducing more shop gamblers to online participation but may need to evolve further as tech-savvy demographics come to dominate the customer base.

With the gambling market’s growing culture of immediacy and spontaneity chiming with wider consumer trends towards personalisation, speed and convenience, adding smartphone connectivity to the self-serve picture should be the next step towards sustainable long-term growth.

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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
      • Executive Summary

          • The market
            • Short odds on low returns
              • Figure 1: Forecast of consumer expenditure* in betting shops, 2010/11-2020/21
            • Machines move in to bolster the betting segment
              • Figure 2: Consumer expenditure* in betting shops, by segment, 2014/15
            • Companies and brands
              • Squeeze on independents tightens big four’s grip
                • Figure 3: UK betting shops, by operator, September 2015
              • Ladbrokes-Coral merger a growth opportunity for others
                • The consumer
                  • No open goals at EURO 2016
                    • Figure 4: Betting shop visiting habits, February 2016
                  • Bad press starting to squeeze machine play?
                    • Figure 5: Betting shop activities, March 2015-February 2016
                  • New terminals a starting point for journeys online
                    • Figure 6: Betting shop visitors’ online gambling habits, February 2016
                  • Instinctive football bettors ready for the in-play
                    • Figure 7: Football betting habits, February 2016
                  • Next generation to spark demand for digital
                    • Figure 8: Technologies influencing choice of betting shop, February 2016
                  • What we think
                  • Issues and Insights

                    • Can self-service succeed alone?
                      • The facts
                        • The implications
                          • Should shops appeal to punters’ heads or hearts?
                            • The facts
                              • The implications
                              • The Market – What You Need to Know

                                • Market grows – but only by a nose
                                  • Operators lower the stakes to reboot machine play
                                    • New shop technologies favour football
                                      • Pressure on profits squeezes shop numbers
                                      • Market Size and Forecast

                                        • Machines keep market edging forwards
                                          • Figure 9: Forecast of consumer expenditure* in betting shops, 2010/11-2020/21
                                        • Forecast
                                            • Figure 10: Forecast of consumer expenditure* in betting shops, 2010/11-2020/21
                                          • Forecast methodology
                                          • Market Segmentation

                                            • March of the machines continues
                                              • Figure 11: UK betting shops gross gambling yield (GGY), by segment, 2013/14-2015/16 (est)
                                            • Can football fans make the jump to racing?
                                              • Figure 12: Betting shops’ over-the-counter GGY, by segment, 2014/15
                                            • Operators lower the stakes to insulate machines segment
                                              • Figure 13: Proportion of Ladbrokes betting shop gaming machine revenues derived from lower-stake slots (B3) content, 2014-15
                                          • Market Drivers

                                            • Shop numbers slip into decline
                                                • Figure 14: UK betting shop numbers, March 2011-September 2015
                                              • Maturing machines market proves resilient
                                                  • Figure 15: Changes in average numbers of category B2 gaming machines versus total gross gambling yield, 2010/11-2014/15
                                                • Multichannel brands seek online players in-store
                                                    • Figure 16: Experience of single and multichannel gambling among past-year betting shop visitors, by age, February 2016
                                                  • Technology focuses on catching up with online
                                                      • Figure 17: SSBT staking patterns, Ladbrokes, Q4 2015
                                                    • Machines keep problem gambling focus on betting shops
                                                        • Figure 18: Locations used to gamble by GamCare clients, 2014/15
                                                      • Major event effect begins to weaken in football
                                                          • Figure 19: OTC football betting patterns, 2010/11-2014/15
                                                      • Companies and Brands – What You Need to Know

                                                        • Ladbrokes-Coral merger to shake up shop scene
                                                          • Operators out to smooth cross-channel journeys
                                                            • William Hill keeps technology in-house
                                                              • Adspend slips back
                                                              • Market Share

                                                                • Big four tighten their grip
                                                                    • Figure 20: UK betting shops, by operator, September 2015
                                                                  • Ladbrokes and Coral move towards merger
                                                                  • Launch Activity and Innovation

                                                                    • Cash-out comes to the counter
                                                                      • Mobile app keeps punters in touch with the shop
                                                                        • William Hill goes it alone with SSBTs
                                                                          • Independents sign up for virtual sports
                                                                            • Data monitoring raises the player protection stakes
                                                                            • Advertising and Marketing Activity

                                                                              • Online cutbacks reach retail advertising
                                                                                  • Figure 21: Leading betting shop operators’ total above-the line, online display and direct mail advertising expenditure*, 2013-15
                                                                                • Power of the press still strong for shops
                                                                                    • Figure 22: Leading betting shop operators’ total above-the line, online display and direct mail advertising expenditure*, by media type 2013-15
                                                                                  • Funding fall-out threatens sponsorship
                                                                                    • Nielsen Media Research coverage
                                                                                    • Company Profiles

                                                                                      • William Hill
                                                                                        • Figure 23: William Hill retail key financials, 2014-15
                                                                                      • Ladbrokes
                                                                                        • Figure 24: Ladbrokes retail key financials, 2014-15
                                                                                      • Gala Coral
                                                                                        • Figure 25: Coral retail key financials, 2014-15
                                                                                      • Betfred
                                                                                        • Figure 26: Betfred Group Ltd key financials, 2013-14
                                                                                      • Paddy Power
                                                                                        • Figure 27: Paddy Power retail key financials, 2014-15
                                                                                    • The Consumer – What You Need to Know

                                                                                      • New crowd needed for football tournament betting
                                                                                        • Bad press starting to squeeze machine play?
                                                                                          • Betting terminals to help shop players get online
                                                                                            • In-play primed for rapid growth
                                                                                              • Intuition trumps information in football market
                                                                                                • New technologies to evolve with the player base
                                                                                                • Betting Shop Visiting

                                                                                                  • Can EURO 2016 bring back the crowds?
                                                                                                      • Figure 28: Betting shop visiting habits, February 2016
                                                                                                    • Mobile to help sell shops online
                                                                                                        • Figure 29: Betting shop visiting habits, by age and gender, February 2016
                                                                                                    • Betting Shop Activities

                                                                                                      • Machine play growth on hold
                                                                                                        • Figure 30: Betting shop activities, March 2015-February 2016
                                                                                                      • Football betting heads for extra time
                                                                                                          • Figure 31: Betting shop activities, by past-year participation in horserace and football betting, February 2016
                                                                                                        • Online gamblers favour familiarity in-store
                                                                                                            • Figure 32: Betting shop activities, by past-year participation in online gambling, February 2016
                                                                                                        • Online Gambling

                                                                                                          • Shop gamblers stick with sport online
                                                                                                              • Figure 33: Betting shop visitors’ online gambling habits, February 2016
                                                                                                          • Football Betting

                                                                                                            • Speculators favour accumulators
                                                                                                                • Figure 34: Football betting habits, February 2016
                                                                                                              • Instant offers play to football’s intuitive streak
                                                                                                                  • Figure 35: Attitudes towards football betting, February 2016
                                                                                                              • Betting Shop Technologies

                                                                                                                • Next generation switched on to a digital future
                                                                                                                    • Figure 36: Technologies influencing choice of betting shop, February 2016
                                                                                                                  • Technology’s football focus raises risks for racing
                                                                                                                      • Figure 37: Technologies influencing choice of betting shop, by betting shop activity, February 2016
                                                                                                                  • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                      • Abbreviations
                                                                                                                        • Consumer research methodology
                                                                                                                        • Appendix – Market Size and Forecast

                                                                                                                            • Figure 38: Forecast of consumer expenditure (GGY) in betting shops, 2015/16-2020/21
                                                                                                                          • Forecast methodology
                                                                                                                          • Appendix – Market Segmentation

                                                                                                                              • Figure 39: Forecast of OTC consumer expenditure (GGY) in betting shops, 2015/16-2020/21
                                                                                                                              • Figure 40: Forecast of consumer expenditure (GGY) on gaming machines in betting shops, 2015/16-2020/21

                                                                                                                          Companies Covered

                                                                                                                          To learn more about the companies covered in this report please contact us.

                                                                                                                          Betting Shops - UK - April 2016

                                                                                                                          £1,995.00 (Excl.Tax)