WHY THE BOOKMAKERS ARE PINNING THEIR HOPES ON EURO 2016
After a disastrous Cheltenham Festival, the bookies need to recoup money on Euro 2016 and will hope the favourites fail
It wasn’t a good Cheltenham for any bookmaker after a spate of favourites won over the four days of the Festival.
In 2015, the operators swerved a potential £100 million bloodbath when Annie Power fell at the last in the Mares’ Hurdle, with Ruby Walsh tumbling after previously landing the spoils on Douvan, Un De Sceaux and Faugheen.
However, 2016 wasn’t as kind, with Douvan, Vroum Vroum Mag and Annie Power hosing up for Willie Mullins on the opening day of the meeting. Altior was a well-supported winner of the Supreme Novices’ Hurdle for Nicky Henderson, while Mullins hot pots Limini and Vautour also came up trumps.
Thistlecrack was an awful result in the World Hurdle and Don Cossack winning the Gold Cup was the final nail in the coffin, with William Hill actually issuing a profits warning off the back of a disappointing four days.
James Henderson, the William Hill chief executive, admitted that the worst Cheltenham Festival in living memory hit the firm hard, especially as Hills went with a best price promise for each of the four days.
He said: “Events have moved at a pace and we have seen two issues come together in accelerated fashion and I felt it was appropriate to provide an update. I can’t remember having four loss-making days at Cheltenham in my career.”
Even so, the bookmakers have previously had things far better at the Festival and Aintree provides some potential respite, even if Willie Mullins bringing his army of horses over means that we could see plenty of favourites going in.
However, a bad or mediocre Aintree would lead the bookies to go super-aggressive with their prices for Euro 2016 as a large swathe of operators look to compete for a share of the spoils.
The UK marketplace has never been more crowded, with the likes of betway, 10Bet and Winner among those looking to muscle in against the traditional operators like Ladbrokes, William Hill and Coral.
Stan James is threatening a resurgence and there’s the obvious heavyweights of bet365, Paddy Power and betfair. The merger of the latter pair means that there is plenty of clout coming from that direction.
What should we expect at Euro 2016?
BetVictor have recently undergone a huge brand overhaul ahead of Cheltenham and they have now pinned their colours to the mast ahead of Euro 2016 by hiring Mr President as a creative agency. They will be tasked to continue to work with the “Simple As” concept.
Head of Brand for BetVictor, Shane Stafford, said: “The new partnership with Mr President is the next step in our exciting journey to provide great value to our customers. Mr President demonstrated a combination of creative flair and understanding of our mission to give our players value, and we look forward to working with them on our ambitious growth goals.”
Indeed, BetVictor are brilliantly competitive when it comes to football odds on the Premier League and we should see the same thing apply when it comes to the European Championships.
BetVictor operate right on the edge when it comes to trading and it’s common to see them going best price about both teams in a football match, with accumulators a common occurrence for these sort of events.
Ladbrokes made a statement of intent recently after the Euro 2016 group draw by laying England at 11/10 to win their section. Wales, Russia and Slovakia means that the Three Lions should comfortably come through the group and it suggests that their trading team are going to be tackling the main home nation.
England are a curate’s egg when it comes to the bookmakers. Every bookmaker with a presence in the UK will want England to prosper. And prosper they should considering that we have a 24-team where sixteen teams qualify for the knockout stage and a win in Group B will see Roy Hodgson’s team play a runner-up.
England’s involvement all the way through the competition will see an increase in turnover. And by rights, an increase in turnover should lead to profits on a match-by-match basis. That’s especially the case now that In-Play betting can account for over 75% of the turnover.
However, an England win at Euro 2016 would not represent a good outcome profit-wise. Let’s not forget the way that the Three Lions were hammered into favouritism ahead of their 2014 World Cup opener against Italy before that 2-1 defeat. The Azzurri were actually available at odds of 2/1.
Terrestrial matches welcome relief after BT Sport
Paddy Power recently admitted that turnover had been badly affected by the decision to switch Champions League coverage from Sky Sports to BT Sport, with this channel not massively accessible up and down the land despite a big marketing push.
A spokesman revealed that stake levels were down roughly 40% compared to the previous season and the early exits of Chelsea, Arsenal and Manchester United have hardly improved matters.
However, all the Euro 2016 matches are being shown on BBC and ITV, with this terrestrial coverage meaning that the world and his wife will be tuning into Switzerland v Albania not to mention England v Russia.
The 24-team format means that this competition will be bigger than ever before, with 36 group games providing a huge volume of opportunity for punters to roll over their money on a continuous basis before a wealth of knockout clashes.
The fact that we have Wales, Northern Ireland and the Republic of Ireland participating means that there is extra-familiarity with the punters, while Spain, Germany, Belgium, France and Italy are instantly-recognisable sides that will attract the eye of betting customers.
What if all the favourites win?
This would be a huge problem for the likes of William Hill who are suffering badly after a bad Cheltenham and feeling the pinch of customers self-excluding like they have never done before.
France are threatening to go off as favourites on home soil and will be the cornerstone of match accumulators from the off, while Germany are also going to be popular in multiple bets along with champions Spain who came a cropper at the 2014 World Cup but are still blessed with talent.
The biggest turnover volumes will take place when England are playing, starting with Russia on 10 June. A win for the Three Lions could light the blue touch paper and bookmakers don’t want punters playing with profit for potential gains.
Price boosts could replace free bets as the draw card
We’ve seen price boosts around for a number of years and it’s still not clear whether they actually deliver a return on investment.
The likes of Paddy Power will go for something outrageous when it comes to the Republic of Ireland and let’s not forget that they laid England at odds of 100/1 for the 2014 World Cup which was a good PR exercise and never in danger of paying out.
Paddy aren’t the only lovers of a price boost, with Coral and betfair the other big players when it comes to these type of offers, while 10Bet might also join the party as they look to get over the line and get a decent share of the market.
Free bets will continue to be offered for Euro 2016 and it’s likely that operators will follow the example of bet365 with a 100% deposit bonus up to £200 that is particularly hard to abuse.
William Hill have bemoaned the sheer volume of bonus abusers which has led them to clamp down on accounts with prohibitive effects, while the age of the free matched bet could be dying a death.
Punters and people in general are just too savvy to get sucked in by a free bet and blow it immediately, with the price boost angle meaning that customers get paid out in free bets as winnings which keeps them loyal to the cause in the early stages.
With the mergers that have taken place and the ones about to happen, this means that Euro 2016 is critical in terms of bolstering customer bases and demonstrating to shareholders that operators can generate a healthy profit margin.