Category Archives: Marketing
This Christmas I managed to do a lot of book reading (most of it being David Bowie-related) and my favourite read was John O’Connell’s Bowie’s Books: The Hundred Literary Heroes Who Changed His Life (which If I’m nit-picking should actually be the 98 heroes because George Orwell and Anthony Burgess make two appearances each on the list), followed by Will Brooker’s Why Bowie Matters (a book I wish I had wrote because it was written by a Professor of Film and Cultural Studies and is a loose account of an academic spending a whole year trying to live like David Bowie as a piece of research). I also love lists so I thought I’d kick off the New Year with a list of the books that have shaped my academic life. This list was first published by The Psychologist (in 2018) but this blog may give my list a wider readership.
One of the most influential books on my whole career is Jim Orford’s seminal book Excessive Appetites that explored many different behavioural addictions including gambling, sex, and eating (i.e., addictions that don’t involve the ingestion of psychoactive substances). Jim Orford’s books are always worth a read and he writes in an engaging style that I have always admired. It was by chance that I did my PhD at the University of Exeter (1987-1990) where Orford was working at the time and since 2005 we have published many co-authored papers together. While we can agree to disagree on some aspects of how and why people become addicted, Jim will continue to be remembered as a pioneer in the field of behavioural addiction.
The Psychology of Gambling (by Michael Walker)
If there’s one book I’d wish I had written myself, it is this one. I did my PhD on slot machine addiction in adolescence but this book was published shortly after I’d finished and beautifully summarises all the main theories and perspectives on gambling psychology. My PhD would have been a whole lot easier if this book had been published when I first started my research career! I got to know Michael quite well before his untimely death in December 2009 (and he was external PhD examiner to some of my PhD students), and one of my enduring images of him was walking around at gambling conferences with his book clutched in his hand. Some of my colleagues found that a little strange but if I’d have written a book that good I’d have it with me at such events all the time!
I reviewed this book for the British Journal of Clinical Psychology (BJCP) back in the early 1990s and concluded by saying that it is a book that should be read by all therapists because its content can be applied to nearly all clinical situations and not just to those individuals with addictive behaviour problems. Motivational interviewing (MI) borrows strategies from cognitive therapy, client-centred counselling, systems theory, and the social psychology of persuasion, and the underlying theme of the book is the issue of ambivalence, and how the therapist can use MI to resolve it and allow the client to build commitment and reach a decision to change. In my most recent research I’ve used the basic tenets of MI in designing personalised messages to give to gamblers while they are gambling online in real time. I’ve now come to the conclusion 25 years after writing my BJCP review that anyone interested in enabling behavioural change should apply the tenets in this book to their work.
Even though this book was published back in 1992, I still tell my current students that this is a ‘must read’ book. Davies takes a much researched area of social psychology (i.e., attribution theory) and applies it to addiction. The basic message of the book is that people take drugs because they want to and not because they are physiologically addicted. The whole book is written in a non-technical manner and is highly readable and thought provoking. I often use Davies’ term ‘functional attribution’ from this book in my teaching and writings on sex addiction, and apply it to celebrities who use the excuse of ‘sex addiction’ to justify their infidelities.
Anyone that reads my blog will know that when it comes to the more bizarre side of sexual activity, my ‘go to’ book is Dr. Aggrawal’s book on unusual sexual practices. Others in the sexology field often look down their noses at this book but it is both enjoyable and informative and the kind of book that once you start reading you find it hard to put down again. A lot of academic books on sexual behaviour can be boring and/or impenetrable but this one is the polar opposite. The book also kick-started some of my own recently published research on sexual fetishes and paraphilias.
During my PhD, I remember watching the 1988 adaptation of David Lodge’s novel Small World. At the time, I had never heard of David Lodge but I went out and bought the book and was totally hooked. I then discovered that Small World was the second part of a ‘campus trilogy’ (preceded by Changing Places and followed by Nice Work). Since then I have bought every novel Lodge has ever published and he’s my favourite fiction writer (and I’ve bought and read some of his academic books on literary criticism). I love campus novels and through Lodge and devoured other university-based novels (including Malcolm Bradbury’s The History Man, Howard Jacobson’s Coming from Behind, and Ann Oakley’s The Men’s Room among my favourites).
Dr. Mark Griffiths, Professor of Behavioural Addiction, International Gaming Research Unit, Nottingham Trent University, Nottingham, UK
Aggrawal A. (2009). Forensic and Medico-legal Aspects of Sexual Crimes and Unusual Sexual Practices. Boca Raton: CRC Press.
Brooker, W. (2019) Why Bowie Matters. London: William Collins.
Davies J. B. (1992). The Myth of Addiction. Reading: Harwood Academic Publishers.
Griffiths, M.D. (2018). My shelfie. The Psychologist: Bulletin of the British Psychological Society, 31, 70.
Lodge, D. (1984). Small World. London: Secker & Warburg.
Miller, W. R., & Rollnick, S. (1991). Motivational Interviewing: Preparing People to Change Addictive Behavior. New York: Guilford Press.
O’Connell, J. (2019). Bowie’s Books: The Hundred Literary Heroes Who Changed His Life. London: Bloomsbury.
Orford, J. (2001). Excessive Appetites: A Psychological View of the Addictions. Chichester: Wiley.
A couple of days ago, Simon Stevens, the Chief Executive of the British National Health Service (NHS) said that foreign-owned betting companies who sponsor British football clubs should financially contribute to paying for gambling addicts’ treatment. I am all in favour of this, although I think some money should also be allocated to education, prevention, and (predictably) research. This is also an area that I have written about recently.
More specifically, I and my colleague Dr. Hibai Lopez-Gonzalez published a paper earlier this year entitled ‘Betting, forex trading, and fantasy gaming sponsorships – A responsible marketing inquiry into the ‘gamblification’ of English football’ in the International Journal of Mental Health and Addiction. Using data about sponsorship deals from English Football Premier League, we demonstrated that gambling marketing has become firmly embedded in the financial practices of many Premiership football clubs. We argued that these associations are not trivial, and that the symbolic linkage of sport and newer gambling forms may become an issue of public health, especially affecting vulnerable groups such as minors and problem gamblers.
A major preoccupation regarding gambling intersection with sports has been the marketing of betting as an experience inherently associated with the symbolic culture of sport. By emphasising its connections with sports, the marketing and advertising of betting has been theorised to pursue the ‘sanitation’ of gambling, transferring the health-related symbolic attributes of sport and physical exercise to betting behaviour. In this regard, of great concern is the effects that an excessive volume of betting marketing might have on vulnerable groups such as minors and young adults and individuals suffering or recovering from gambling disorder. Furthermore, additional issues might arise in the event that those new categories that extend the definition of sports gambling (i.e., trading, other gambling forms such as poker, and fantasy games) seeking to market their products in alignment with (or appropriation of) sports’ core values and positive attributes. Early examples of this marketing strategy can be found in the sport stars’ endorsement of poker brands such as the footballers Neymar Jr. and Cristiano Ronaldo, and the tennis player Rafael Nadal.
We asserted in our paper that football shirt sponsorship is arguably a good proxy to calibrate the volume of gambling marketing in English football. Table 1 shows the shirt sponsor evolution over a decade (from the 2007/2008 to 2016-2017 seasons). First team shirt sponsorship with gambling companies evolved from four deals in 2008, six deals in 2012, to ten deals in 2017, accounting for half of the 20 English Premier League teams. The saturation of shirt logos owned by gambling brands has evolved rapidly over a relatively short period of time. However, some industry voices have been anticipating a decline in the numbers of shirts being sponsored by gambling firms due to their incapacity to compete with other business sector, although such a decline has yet to materialise.
In the same vein, it has been noted that most of the football teams with shirts sponsored by gambling companies are among the less powerful in the league, both in terms of economic profitability and sporting success. Analysing the data from end of season table positions indeed demonstrates a bias of gambling companies sponsoring teams towards the bottom of the table. Thus, the four teams (out of 20 in the English Premier League) with gambling logos in 2007/08 finished the league 6th, 7th, 11th, and 15th. In 2011-12, the six teams sponsored by gambling companies finished 10th, 11th, 13th, 16th, 18th, and 20th. In 2016/2017 season, the ten teams with gambling sponsors showed an almost perfect inverse correlation between table position and gambling-origin shirt sponsor, ranking 9th, 10th, 11th, 13th, 14th, 15th, 16th, 17th, 18th, and 20th (19th being a money loan company).
This could be interpreted as a nuanced strategy. More specifically, gambling operators might believe they have enough global exposure that the league as whole offers, without needing to pay premium sponsorship deals to attach their brand to the most supported and successful teams (because all the lower ranked teams have to play all the upper ranked teams and therefore get equal advertising exposure during televised games).
Table 2 shows the breadth of the gamblification process by focusing on sponsorship deals running through 2016-17 season in the English Premier League. As can be observed, all teams secured at least one official betting partner, with some of them having multiple partners due to regional deals in strategic markets to provide so-called ‘geo-targeted’ betting experience. An illustration example is Arsenal club’s deals with 12Bet company in Asia, Betfair in Europe, SportPesa in Kenya, and Tempobet in Oceania. Altogether, the 20 English Premier League teams totalled 20 different betting brands, with 12 brands sponsoring only one team, five brands sponsoring two teams, and three brands sponsoring three different teams. Despite how fragmented the betting market might look, these brands represent only a small fraction of the actual number operating in association with the English football. In fact, betting brands are generally considered to offer poorly differentiated products in highly competitive markets. Consequently, marketing plays a significant part in artificially creating singular attributes that facilitate the acquisition and maintenance of customers.
Sponsorship deals with trading companies are not as prevalent as betting sponsorships. However, 14 out of 20 English Premier League teams have linked partnership deals with trading companies – most notably forex trading – for 2016/17 season. Only one trader (EZTrader) sponsors two different teams, while the rest are unique sponsors. Arguably, the same betting market attributes of low product differentiation and competitive environment also applies to trading firms.
Fantasy gaming is rapidly becoming a large component of sports appreciation, especially in the USA where fantasy sports appears to have partially absorbed the consumer base for online sports betting, an illegal activity in most states. Although still in its infancy in Europe, eight out of 20 English teams already have agreements in place with fantasy sports companies, some of which include a deal with DraftKings, the leading company along with FanDuel in USA’s fantasy gaming market. The concentration of brands here is slightly higher than in the case of betting and trading sponsorships, but six different brands still populate the growing fantasy gaming market in the English Premier League.
The detrimental effect on public health of an increase in the sports betting marketing volume is difficult to demonstrate. British data collected by the Gambling Commission is inconclusive due to the lack of definition of what constitutes gambling on sports. In general, research has found difficult to substantiate the causal association between gambling advertising exposure and behaviour, particularly when the effects of such exposure might take place weeks or months later. Despite the difficulties of finding empirical evidence of the real impact of marketing on betting behaviour, many authors have acknowledged that the association between marketing and gambling disorder is plausible, at least theoretically.
The sports betting marketing and advertising growth could be theorised to have two effects. First, an increase in gambling advertising exposure will lead to a higher prevalence rate of problem gambling. Many scholars have indicated that problem gamblers are usually more exposed to advertising (e.g., they visit more frequently gambling websites or watch more sport events), therefore it cannot be established whether they gamble more because they are exposed to more marketing instances or the are more exposed because they gamble more. However, a study I published with my Norwegian colleagues at the University of Bergen conducted among 6,034 Norwegian gamblers found that problem gamblers had a greater involvement with gambling advertising even when they were similarly exposed than regular non-problem gamblers.
Second, an overall rise in the consumption of gambling products following more aggressive marketing strategies, even while maintaining stable the percentage of people experiencing gambling-related harm, would lead to a rise in absolute numbers of people developing gambling problems. Simply put, keeping problem gambling rate constant, the more people that bet on sports, the more problem gamblers.
There is a wide consensus that sports betting marketing (and advertising) must be regulated, and is the case in most jurisdictions including the UK. However, there is no specific protection concerning the marketing of trading and fantasy gaming as a specific product category associated with sports. Finally, our paper noted that although there is no scientific evidence the marketing agreements between football clubs and the gambling industry are actually having a detrimental effect on the aforementioned vulnerable groups, it makes theoretical sense to think that they might potentially cause harm.
Note: This article was co-written with Hibai Lopez-Gonzalez
Dr. Mark Griffiths, Professor of Behavioural Addiction, International Gaming Research Unit, Nottingham Trent University, Nottingham, UK
Griffiths, M.D., Estévez, A., Guerrero-Solé F. & Lopez-Gonzalez, H. (2018). A brief overview of online sports betting advertising and marketing. Casino and Gaming International, 33, 51-55.
Lopez-Gonzalez, H., Estévez, A. & Griffiths, M.D. (2017). Marketing and advertising online sports betting: A problem gambling perspective. Journal of Sport and Social Issues, 41, 256-272.
Lopez-Gonzalez, H., Estévez, A. & Griffiths, M.D. (2018). Controlling the illusion of control: A grounded theory of sports betting advertising in the UK. International Gambling Studies, 18, 39-55.
Lopez-Gonzalez, H. & Griffiths, M.D. (2016). Is European online gambling regulation adequately addressing in-play betting advertising? Gaming Law Review and Economics, 20, 495-503.
Lopez-Gonzalez, H. & Griffiths, M.D. (2018). Betting, forex trading, and fantasy gaming sponsorships – A responsible marketing inquiry into the ‘gamblification’ of English football. International Journal of Mental Health and Addiction, 16, 404-419.
Lopez-Gonzalez, H. & Griffiths, M.D. (2018). Understanding the convergence of online sports betting markets. International Review for the Sociology of Sport, in press.
Lopez-Gonzalez, H. Guerrero-Solé, F., Estévez, A. & Griffiths, M.D. (2018). Betting is loving and bettors are predators: A Conceptual Metaphor Approach to online sports betting advertising. Journal of Gambling Studies, in press.
Lopez-Gonzalez, H., Guerrero-Sole, F. & Griffiths, M.D. (2018). A content analysis of how ‘normal’ sports betting behaviour is represented in gambling advertising. Addiction Research and Theory, 26, 238-247.
As the 2018 World Cup kicks in, it’s an opportune time to ask why are we so loyal to our national and club football teams? Whatever the results, we tend to support them week in week out, all year round. They can cause us misery and heartache and yet still we support them. As a Sunderland fan, I know this only too well. In the season just ended I went from agony to even more agony as I saw Sunderland get relegated for the second season in a row.
Could it be that following our clubs is an addiction? It has been argued by academics working in the marketing field that commercial organisations would love to have the kind of brand loyalty shown by football fans – something that Ken Parker and Trish Stuart argued in their award winning paper ‘The ‘West Ham Syndrome’ published in the Journal of the Market Research Society (I’m not making this up, honest!).
Parker and Stuart, working at the time of the study for the company Discovery Research, surveyed 2000 adults and also carried out some focus group interviews with football fans (including some ardent West Ham United supporters). They found that 58% of males had made a commitment to club their team by the age of 11 years. (I just happen to be one of those men having supported Sunderland from the age of 7 years of age after watching them beat Leeds in the 1973 FA Cup Final). More than half of children whose parents supported a team went on to support the same one, while a third of all fans still followed their local team.
Marketeers would love to be able to take the seemingly unstinted loyalty of football fans and somehow transfer that loyalty to the products they are trying to sell. For instance, the brand of coffee we buy tends to be governed by many factors such as television advertising, the taste, the price, the packaging, etc. If we come across coffee that (for whatever reason) is better (cheaper, tastes better, etc.), we automatically switch our ‘allegiance’ to another brand of coffee. Parker and Stuart argued that wherever West Ham finish in the league, Hammers fans would not desert their club and/or switch to another club. So what’s the difference between football clubs as a brand and other commercial products as a brand? Maybe it’s passion and the fact that football can be such an emotional experience for the diehard fan.
Some working in the advertising industry claim many people working in marketing lack passion in their product. Apparently there are other products (such as cars) that consumers get very passionate about and this means that they repeatedly buy a particular make of car despite any acknowledged faults. However, one huge fault can damage a brand’s reputation almost overnight, as Toyota is only too aware. The good news for Toyota is that one of the most interesting things about research on the ‘West Ham Syndrome’ is that it can help to explain why leading brands are able to bounce back from PR disasters in similar ways to football clubs come back from being relegated to a lower division.
However, are football fans really as loyal as most of us assume? A paper by Alan Tapp examined the loyalty of football fans (in the Journal of Database Marketing and Customer Strategy Management) and wondered what it is about football clubs as a brand that makes them so successful – especially as the ‘product’ is so inconsistent and unpredictable? (‘Inconsistent’ and ‘unpredictable are certainly words I would associate with the England team and the England players!). Parker and Stuart claimed that levels of loyalty were “only marginally affected” by West Ham’s fortunes. However, Tapp says this is completely untrue. He cites analysis of football attendance figures since 1945 to show that crowd sizes are related to a team’s position in the league, and that teams lose support when they are doing poorly. Despite the fact that crowd attendance is linked to how well a football club is doing, it’s still probably true to say that football fans are still more loyal to their club than they are to most other products. All this goes to show is that most of us will continue to love England, warts and all.
Just before the 1998 World Cup, I began to carry out some research into football fanaticism and whether football fanatics could be considered ‘addicted’ to following their football team. This is easier said than done as it all depends upon how addiction is defined, and if ‘football fan addiction’ exists, what are people actually addicted to? I define addiction as any behaviour that features what I believe to be the six core components of addiction (i.e., salience, mood modification, tolerance, withdrawal symptoms, conflict and relapse). Throughout my career, I have consistently argued that any behaviour that fulfils these six criteria should be considered as a genuine addiction. If you were addicted to following your football team, this is what I would expect:
Salience – This occurs when following your football team (and doing things related to your football team) becomes the most important activity in your life and dominates your thinking (total preoccupation), feelings (cravings) and behaviour (deterioration of socialized behaviour). For instance, even if you are not actually engaged in something football-related, you will be thinking about the next time that you are.
Mood modification – This is the subjective experience that you would feel as a consequence of following your football team (i.e. you experience an arousing ‘buzz’ or a ‘high’ – or the exact opposite – a tranquilizing feeling of ‘escape’ or ‘numbing’ when following your team).
Tolerance – This is the process whereby increasing amounts of activity related to your football team are needed to get mood modifying effects. This basically means that if you were engaged in activities related to following your football team, you would gradually build up the amount of the time you spend engaged in those activities.
Withdrawal symptoms – These are the unpleasant feeling states and/or physical effects (e.g., the shakes, moodiness, irritability etc.) that occur when you are prevented from following your football team or stopped from engaging in football-related activities.
Conflict – This refers to the conflicts between following your football team and those around you (interpersonal conflict), conflicts with other activities (your job, schoolwork, social life, hobbies and interests) or from within yourself (knowing you are doing too much of the activity and/or subjective feelings of loss of control) which are concerned with spending too much time following your football team.
Relapse – This is the tendency to revert back to earlier patterns of behaviour (following your football team and engaging in football-related activity) after a period of abstinence.
Using these criteria, I have come across very few genuine examples of someone addicted to a football team. The most extreme case I have come across was one woman who left her husband because of his ‘addiction’ to Chelsea football club. She told me that their bedroom was a shrine to Chelsea, he watched almost every Chelsea game home and away (including European away matches), spent all their joint savings and ran up huge debts following Chelsea, and eventually got sacked from his job because he kept ringing in sick whenever Chelsea were playing hundreds of miles from home during midweek games. Out of season he would be constantly depressed and would try to alleviate his mood by endlessly watching videos of Chelsea’s greatest games. Once the football season started, his depression would lift. I never met this individual but he appears to have fulfilled my criteria for addiction.
For most people, enthusiastically following your team – even to excess – is unlikely to be an addiction. The main difference between a healthy excessive enthusiasm and an addiction is that healthy enthusiasms add to life and addictions take away from it.
(Please note that a version of this article was originally published in The Conversation)
Dr Mark Griffiths, Professor of Gambling Studies, International Gaming Research Unit, Nottingham Trent University, Nottingham, UK
Griffiths, M.D. (1996). Behavioural addictions: An issue for everybody? Journal of Workplace Learning, 8(3), 19-25.
Griffiths, M.D. (2005). A ‘components’ model of addiction within a biopsychosocial framework. Journal of Substance Use, 10, 191-197.
Griffiths, M.D. (2017). Behavioural addiction and substance addiction should be defined by their similarities not their dissimilarities. Addiction, 112, 1718-1720.
Parker, K., Stuart, T. 1997. The West Ham syndrome. Journal of the Market Research Society, 39(3), 509-517.
Tapp, A. (2004). The loyalty of football fans – We’ll support you evermore? Journal of Database Marketing and Customer Strategy Management, 11, 203-215.
“Cash Out lets you take profit early if your bet is coming in, or get some of your stake back if your bet is going against you – all before the event you’re betting on is over. Cash Out offers are made in real time on your current bets, based on live market prices. Whenever you are ready to Cash Out, simply hit the yellow button. Cash out is available on singles and multiples, on a wide range of sports, including football, tennis, horse racing, and many more! You can Cash Out of bets pre-play, in-play, and between legs” (Definition of ‘cash out’ betting on Betfair website, 2017).
Most European sports betting operators now feature ‘cash out’ functionalities in their online platforms. This means that bettors can withdraw their bets before the event bet upon has concluded, obtaining a smaller but guaranteed return if the outcome of the bet is going their way, or, conversely, cutting down the monetary impact of a foreseeable loss. The ‘cash out’ functionality has rapidly become popular among sports bettors that bet in-play (i.e., during the game on things such as soccer matches and horse races) as a way of maximising value on the bets they have made.
Industry voices such as David O’Reilly, from Colossus Bets, have identified four major benefits of cash out features for bookmakers: (i) reducing the volatility of the operator’s revenue; (ii) increasing the recycling of player returns, with more players banking smaller amounts; (iii) enabling players to avoid their ‘near miss’ frustration; and (iv) improving the player engagement with the platform by introducing a mechanism that promotes constant checking. However, for sports bettors, cashing out strategies might typically involve cutting down the profit while being ahead but rarely reducing the loss when going behind. In this regard, cashing out does not appear to differ greatly from other new internet-based betting forms (e.g. so-called ‘exotic’ or multiple bets), which have been found to possess, in general, higher expected losses for gamblers and greater profit margins for operators.
However, beyond the feature’s financial rationale, cash out affects the nature of sports betting in more meaningful ways. It is, arguably, a game-changer, that leads (along with other features such as ‘edit my acca’ features in which specific bets can be removed from ‘accumulator’ bets) to the transformation of sports betting from a discontinuous to a continuous form of gambling. Here, our contention is that cash out is a key component of the contemporary bettor-bookmaker interaction, and that the widespread adoption by devoted sports bettors merits a closer look into the implications of such an interaction from a problem gambling perspective. Such an examination also suggests that regulators and policymakers need to think about how to protect gambling consumers from the potential harm caused by this new type of betting.
Structural characteristics have been proposed as a determining factor that can influence problem gambling behaviour. Structural characteristics are those associated with the design of a gambling product that shape the way gamblers interact with it. Typical structural characteristics include, but are not limited to, bet frequency, bet duration, event frequency, near misses, stake size, jackpot size, probability of winning, and interface design (e.g., the use of music and colour stimuli in the design of slot machines).
The internet has altered significantly the structural characteristics of gambling and sports betting more specifically. For example, in a number of European countries, the football (soccer) pools used to comprise bets placed during a weekday on the outcome of a game played typically on a Saturday or Sunday (i.e., a once a week wager). This reward delay was a major protective factor against excessive gambling, which on a psychobiological level has been theorised as an imbalance in an individual’s dopamine receptors, and therefore, highly sensitive to shorter bet reward periods. Betting via the internet has reduced such delays in receiving rewards from gambling, thus modifying a major structural characteristic of betting from once a week to (in some instances) every few minutes.
In parallel to the increased uptake of Internet betting in many jurisdictions, a second dynamic, namely globalisation, has further widened the possibilities of betting across countries, sports, and time zones, ultimately transforming sports betting into a 24/7 activity where the bookmaker never closes the shop any day during the year. For the first time, if a gambler has a craving to bet, the market is able to respond to that demand anytime and anywhere via a range of Wi-Fi enabled portable devices (e.g., smartphone, tablets, laptops, etc.). Virtual sports have expanded the availability of betting options even more, eliminating the need to bet on real world sport events.
Although the time between bets (i.e., bet frequency) was effectively reduced to near zero, the time within bets (i.e., bet duration) changed little until cash out functionality was first introduced by the gaming operator William Hill in December 2012. With cash out features, sports betting has become a potentially continuous gambling activity, one that resembles the playing mechanics the stock market. As with investing in stocks, bet values in in-play sports betting are re-calculated seamlessly. The outcome of a sport event might not be as relevant for many bettors as the value their bet will acquire in the next few seconds, even if that bet turns out to be erroneous at the end of the game. As in stock market investing, betting becomes continuous because non-actions also qualify as actions in themselves. Every single second that a bettor decides not to cash out, a new bet takes place. Eventually, cash out features introduce the notion that it is the bet itself the commodity that is being traded in the sports betting market. This new continuous type of sports betting raises questions concerning the gambling-related harm that could be associated with it. It also suggests that the kinds of regulation found widely in the stock market investment sector might have some utility if applied to this new form of gambling.
From a marketing perspective, cash out functionality is often advertised as a control-enhancing mechanism for bettors. Given that cashing out is typically presented in television advertisements as a risk-free operation, the product is likely to be perceived as reimbursable if the client is not happy with it, arguably promoting less planned gambling behaviours. Some gaming operators use the alternative name of “edit my bet” to refer to cash out, focusing on the capacity of bettors to correct later possible errors of judgement. The problem is that (and as happens in stock market investing), cashing out is only possible at the current value of the stock (which may be inferior to the purchasing price). Additionally, and contrary to what happens in stock market investing, betting operators automatically devalue the bet price immediately after the purchase. For example, a bookmaker will typically offer to cash out for $0.95 or similar a $1 bet placed one second ago, a price devaluation unmotivated by any new information or event actually affecting the predicted value of such a bet.
Beyond its most apparent attributes, we have demonstrated that cash out within in-play gambling is a pivotal feature that has been introduced by the sports betting industry to transform sports betting from what was traditionally a discontinuous form of gambling into a continuous one. It is contended that, although cashing out presupposes more engaged gamblers that feel more in control of their bets, the emotionally charged context in which it is often used and the structural attributes of the product itself might actually make some bettors lose control over their gambling wagers. Consequently, gambling policymakers and regulators should be cognizant of the challenges of this transformation of sports betting and consider the implications for the protection of gambling consumers.
[Note: This article was co-written with Dr. Hibai Lopez-Gonzalez]
Dr. Mark Griffiths, Professor of Behavioural Addiction, International Gaming Research Unit, Nottingham Trent University, Nottingham, UK
Betfair (2017). Sportsbook: What is cash out and how does it work? Retrieved March 1, 2017, from: https://en-betfair.custhelp.com/app/answers/detail/a_id/4/~/sportsbook%3A-what-is-cash-out-and-how-does-it-work%3F
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Lopez-Gonzalez, H., & Griffiths, M. D. (2016). Understanding the convergence of online sports betting markets. International Review for the Sociology of Sport. http://doi.org/doi:10.1177/1012690216680602
Lopez-Gonzalez, H. & Griffiths, M.D. (2017). ‘Cashing out’ in sports betting: Implications for problem gambling and regulation. Gaming Law Review: Economics, Regulation, Compliance and Policy, 21(4), 323-326.
McCormack, A., & Griffiths, M. D. (2013). A scoping study of the structural and situational characteristics of internet gambling. International Journal of Cyber Behavior, Psychology and Learning, 3(1), 29–49.
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Parke, J., & Griffiths, M. D. (2007). The role of structural characteristics in gambling. In G. Smith, D. Hodgins, & R. Williams (Eds.), Research and Measurement Issues in Gambling Studies (pp. 211–243). New York: Elsevier.
Sports Trading Life. (2015). Is “cash out” actually BAD for betting punters? Retrieved March 1, 2017, from http://sportstradinglife.com/2015/03/is-cash-out-actually-bad-for-punters/
Throughout my career I’ve carried out quite a lot of research into the marketing and advertising of gambling and the way in which some gambling operators use psychology to exploit our senses to maximize profit. Connected to this, I’ve also published a number of papers that have examined the role of sound (and particularly music) can influence the way in which individuals gamble (see my previous blog on this and ‘Further reading’ below).
The reason I mention this was that I recently came across an online article by Fast Company entitled ‘The 10 most addictive sounds in the world’ based on some market research carried out by Martin Lindstrom, the Danish ‘neuromarketeer’, author of the book Buyology – Truth and Lies About Why We Buy (I do love a good pun). Lindstrom is known for using neuroscientific techniques to help commercial operators better understand their clientele. One of his collaborations was with Elias Arts (a sound and music design company) who joined forces to examine the world’s most ‘addictive sounds’ in what an article in The Village Voice dubbed a “neuromarketing experiment”.
Obviously, my interest was piqued when I saw the use of the word ‘addictive’ but their working definition of ‘addictive’ had nothing to do with individuals being addicted to sounds but simply referred to an individual’s response to specific sounds. (Even with this explanation, I still can’t see why the word ‘addictive’ was used but its’ use probably guarantees more people – like myself – will want to read about the study). Lindstrom told the media that:
“We have all those top 10s of everything, but most top 10s are based on the visual sense. What we realized in another study is the most prominent sense we have [when we see a commercial] is not the sense of sight or smell, but the sense of sound”.
As far as I can tell, the study Lindstrom carried out has not been formally published in a peer reviewed journal (although he has published academic papers). The study was described in the international media as involving 50 participants and the research team monitored their brainwave, pupil, and facial muscle activity while listening to 50 different everyday sounds (both man-made ‘branded’ sounds and those ‘non-branded’ sounds that occur naturally). Lindstrom concluded that the most ‘addictive sounds’ weren’t necessarily the non-branded sounds of nature because some of the commercial man-made branded sounds (described as “beeps, jingles and ditties”) were more ‘addictive’ than a number of familiar sounds found in everyday life.
Overall, sound of a baby giggling was ranked as the most ‘addictive sound’ (although I’ve not seen the specific methodology employed to ascertain how being the top ‘addictive sound’ was actually assessed. Apparently Lindstrom examined the “dimension of the responses” and the “contrast and balance of all three [brainwave, pupil and muscle] factors” – although he did admit that such factors can lead to both positive and negative reactions). The second and third spots were Intel’s computer startup chime and the sound of a vibrating mobile phone. Other top non-branded sounds were the sound of a sizzling steak and the lighting of a cigarette being inhaled. Lindstrom claimed that the participants “weren’t responding to the structures of the sounds, but what they mean in a greater social context”. In relation to what makes a sound ‘addictive’, Lindstrom did at least make one reference to a classic sign of addiction (i.e., craving):
“It’s not the sound itself, but the consequence of the sound. A laughing (or crying) baby elicits a maternal protection mechanism, a buzzing cell phone prompts a pick-up, a sizzling steak means a solid meal is on the way. For advertisers and consumers, the research indicates a whole new battleground of multi-sensory advertising. Sometimes the sound from one category generates a craving in another category. For example, given the links between tobacco and beverages, the sound of a cigarette being lit could be used in an ad for alcohol. Although sound is more intuitive for people, the field is still quite young. It will be a long time before it will be so prominent”.
In a story for ABC News, other academics were asked for their thoughts on Lindstrom’s study. One American ‘auditory neuroscientist, Professor Barbara Shinn-Cunningham (actually Professor of Biomedical Engineering at Boston University) said that:
“Although the sounds identified by the study are extremely meaningful, with the exception of the giggling baby, most are not inherently addictive. They’re identifiable. They brain responds to repetition. Our brains are good at picking out patterns that repeat. We’ve evolved to do that. If I chose an arbitrary sound, as long as it was clear and distinctive, and then played it 50 times a day for the next five years (as many of the branded sounds have been), it would become attention-grabbing. I don’t think [the sounds on the list are] so much addictive because of their acoustic properties, but because of their ubiquity. There is neurophysiological evidence showing that brain is hardwired to notice certain kinds of sounds. For example, the abrupt, jarring sound of a slamming door could prompt cells in a person’s brain stem to fire even before that person was conscious of it. For early humans, that kind of sound could have meant it’s time to run for the hills. [Also] studies have demonstrated the existence of a so-called ‘cocktail party effect’. At a party, if you hear your name in the background, even if you’re not paying attention, that’s something that will draw your attention involuntarily. Your brain is so exposed to your name and it’s tremendously important to you, so it encodes that so you respond to it”
According to Lindstrom’s research, the most ‘addictive sounds’ in the world (although they are arguably US-centric to say the least) are: (1) baby giggle, (2) Intel chime, (3) vibrating phone, (4) ATM/cash register, (5) National Geographic theme tune, (6) MTV theme tune, (7) T-Mobile ringtone, (8) McDonald’s jingle, (9) ‘Star Spangled Banner’ (tune), and (10) State Farm jingle.
The Fast Company article also noted that:
“Sound is immensely powerful. And yet 83% of all the advertising communication we’re exposed to daily (bearing in mind that we will see two million TV commercials in a single lifetime) focuses, almost exclusively, on the sense of sight. That leaves just 17% for the remaining four senses. Think about how much we rely on sound. It confirms a connection when dialing or texting on cell phones and alerts us to emergencies. When the sound was removed from slot machines in Las Vegas, revenue fell by 24%. Experiments undertaken in restaurants show that when slow music (slower than the rhythm of a heartbeat) is played, we eat slower–and we eat more!”.
These types of findings suggest that ‘audio branding’ is likely to be an increasing topic of academic research given that every company wants an edge in selling their product. While I am totally unconvinced that the word ‘addictive’ should be used in this type of research, that’s not to say that sound doesn’t have an influence in the development of addictive behaviour more generally. It looks like a case of watch (or should that be listen?) to this space.
Bark Soho (2016). 3 of the most addictive sounds in the world. October 16. Located at: http://www.barksoho.co.uk/blog/3-of-the-most-addictive-sounds-in-the-world/
Dixon, L., Trigg, R. & Griffiths, M. (2007). An empirical investigation of music and gambling behaviour. International Gambling Studies, 7, (3), 315-326.
Edroso, R. (2010). “Most addictive” sounds mostly jingles, machine noises. The Village Voice, February 22. located at: https://www.villagevoice.com/2010/02/22/most-addictive-sounds-mostly-jingles-machine-noises/
Fast Company (2010). The 10 most addictive sounds in the world. February 22. Located at: https://www.fastcompany.com/1555211/10-most-addictive-sounds-world
Griffiths, M.D. & Parke, J. (2003). The environmental psychology of gambling. In G. Reith (Ed), Gambling: Who wins? Who loses? pp. 277-292. New York: Prometheus Books.
Griffiths, M.D. & Parke, J. (2005). The psychology of music in gambling environments: an observational research note. Journal of Gambling Issues, 13.
Heussner, K.M. (2010). The world’s 10 most addictive sounds. ABC News, February 24. Located at: https://abcnews.go.com/Technology/worlds-10-addictive-sounds/story?id=9923506
Lindstrom, M. (2008). Buyology: Truth and Lies About Why We Buy. New York: Doubleday
Parke, J. & Griffiths, M.D. (2006). The psychology of the fruit machine: The role of structural characteristics re-visited. International Journal of Mental Health and Addiction, 4, 151-179.
Parke, J. & Griffiths, M.D. (2007). The role of structural characteristics in gambling. In G. Smith, D. Hodgins & R. Williams (Eds.), Research and Measurement Issues in Gambling Studies. pp.211-243. New York: Elsevier.
Spenwyn, J., Barrett, D.K.R. & Griffiths, M.D. (2010). The role of lights and music in gambling behavior: An empirical pilot study. International Journal of Mental Health and Addiction, 8, 107-118.
The buying of loot boxes takes place within online videogames and are (in essence) virtual games of chance. Players use real money to buy virtual in-game items and can redeem such items by buying keys to open the boxes where they receive a chance selection of further virtual items. Other types of equivalent in-game virtual assets that can be bought include crates, cases, chests, bundles, and card packs. The virtual items that can be ‘won’ can comprise basic customization (i.e., cosmetic) options for a player’s in-game character (avatar) to in-game assets that can help players progress more effectively in the game (e.g., gameplay improvement items such as weapons, armor). All players hope that they can win ‘rare’ items and are often encouraged to spend more money to do so because the chances of winning such items are minimal. Many popular videogames now feature loot boxes (or equivalents) including Overwatch, Middle-earth: Shadow of War, Star Wars Battlefront 2, FIFA Ultimate Team, Mass Effect: Andromeda, Fortress 2, Injustice 2, Lawbreakers, Forza Motorsport 7, and For Honor. In short, all of these require the paying of real money in exchange for a completely random in-game item. In an interview with Eurogamer, psychologist Jamie Madigan said:
“Whenever you open [a loot box], you may get something awesome (or you may get trash). This randomness taps into some of the very fundamental ways our brains work when trying to predict whether or not a good thing will happen. We are particularly excited by unexpected pleasures like a patch of wild berries or an epic skin for our character. This is because our brains are trying to pay attention to and trying to figure out such awesome rewards. But unlike in the real world, these rewards can be completely random (or close enough not to matter) and we can’t predict randomness. But the reward system in your brain doesn’t know that. Buying [loot boxes] puts them into the same category of packs of Pokémon cards or baseball cards. Unlike gambling in a casino, you’re going to get something out of that pack. Maybe just not the thing you wanted”.
Although there are many definitions in many disciplines defining gambling, there are a number of common elements that occur in the majority of gambling instances that distinguish ‘true’ gambling from mere risk-taking. These include: (i) the exchange is determined by a future event, which at the time of staking money (or something of financial value) the outcome is unknown, (ii) the result is determined (at least partly or wholly) by chance, (iii) the re-allocation of wealth (i.e., the exchange of money [or something of financial value] usually without the introduction of productive work on either side, and (iv) losses incurred can be avoided by simply not taking part in the activity in the first place. Added to this it could be argued that the money or prize to be won should be of greater financial value than the money staked in the first place. Based on these elements, the buying of loot boxes (or equivalents) would be classed as a form of gambling, as would other activities such as the Treasure Hunter and Squeal of Fortune games within the Runescape videogame and online penny auctions (which I have argued in previous papers – see ‘Further reading’).
In the UK Gambling Commission’s most recent (March 2017) position paper on virtual currencies and social casino gambling noted:
“One commonly used method for players to acquire in-game items is through the purchase of keys from the games publisher to unlock ‘crates’, ‘cases’ or ‘bundles’ which contain an unknown quantity and value of in-game items as a prize. The payment of a stake (key) for the opportunity to win a prize (in-game items) determined (or presented as determined) at random bears a close resemblance, for instance, to the playing of a gaming machine. Where there are readily accessible opportunities to cash in or exchange those awarded in-game items for money or money’s worth those elements of the game are likely to be considered licensable gambling activities [Section 3.17]…Additional consumer protection in the form of gambling regulation, is required in circumstances where players are being incentivised to participate in gambling style activities through the provision of prizes of money or money’s worth. Where prizes are successfully restricted for use solely within the game, such in-game features would not be licensable gambling, notwithstanding the elements of expenditure and chance [Section 3.18]”.
Consequently, the UK Gambling Commission does not consider loot boxes as a form of gambling because (they claim) the in-game items have no real-life value outside of the game. However, this is not the case because there are many websites that allow players to trade in-game items and/or virtual currency for real money. The Gambling Commission appear to acknowledge this point and claim that the buying of in-game loot boxes (and their equivalents) are not gambling but if third party sites become involved (by allowing the buying and selling of in-game items), the activity does become a form of gambling. As Vic Hood (in a 2017 article in Eurogamer) rightly notes, this appears to be a case of the law struggling to keep pace with technology. There are also issues surrounding age limits and whether games that offer loot boxes (or equivalents) should be restricted to those over the age of 18 years.
Predictably, those in the videogame industry do not view the buying of loot boxes as gambling either. For instance, Dirk Bosmans (from PEGI [Pan European Game Information], the European-based videogame rating organization) stated in a recent interview with Eurogamer that:
“Loot crates are currently not considered gambling: you always get something when you purchase them, even if it’s not what you hoped for. For that reason, a loot crate system does not trigger the gambling content descriptor. If something is considered gambling, it needs to follow a very specific set of legislation, which has all kinds of practical consequences for the company that runs it. Therefore, the games that get a PEGI gambling content descriptor either contain content that simulates what is considered gambling or they contain actual gambling with cash payouts. If PEGI would label something as gambling while it is not considered as such from a legal point of view, it would mostly create confusion. We are always monitoring such developments and mapping consumer complaints. We see a growing need for information about specific features in games and apps (social interaction, data sharing, digital purchases), but the challenge is that such features are rapidly becoming ubiquitous in the market, yet they still come in very different shapes and sizes.”
This appears somewhat hardline given that PEGI’s descriptor of gambling content is used whenever any videogame “teaches or encourages” gambling. Such a descriptor would arguably cover gambling-like games or activities and the buying of loot boxes is ‘gambling-like’ at the very least. The same stance has been taken by the Entertainment Software Rating Board (ESRB) which rates videogames in Canada and the USA. A spokesman for the ESRB told Eurogamer that:
“ESRB does not consider [the buying of loot boxes] to be gambling because the player uses real money to pay for and obtain in-game content. The player is always guaranteed to receive something – even if the player doesn’t want what is received. Think of it like opening a pack of collectible cards: sometimes you’ll get a brand new, rare card, but other times you’ll get a pack full of cards you already have. That said, ESRB does disclose gambling content should it be present in a game via one of two content descriptors: Simulated Gambling (player can gamble without betting or wagering real cash or currency) and Real Gambling (player can gamble, including betting or wagering real cash or currency). Neither of these apply to loot boxes and similar mechanics.”
At present, there are a number of countries (mainly in South East Asia such as China and Japan) who do view the buying of loot boxes as a form of gambling and have incorporated such activities into their gambling regulation. However, most countries have either not considered regulating the buying of loot boxes at all, or (like the UK) have ruled out that buying loot boxes does not currently meet their regulatory definition of gambling. Although there has been little published in academic journals on loot boxes, a number of articles in the trade press have claimed that the buying of loot boxes can be problematic and/or addictive because they are designed using highly similar reward schedules to those used in the design of slot machines. This is something that have also pointed out in relation to similar activities to the buying of loot boxes where individuals play for points rather than money. Personally, I view the buying of loot boxes as a form of gambling particularly because the ‘prizes’ won are (in financial terms) often a lot less than that of the price paid. Obviously I am out of step in relation to the regulators in my own country, but if third party websites continue to host services where in-game virtual items can be bought and sold, the activity definitely constitutes a form of gambling by almost any definition of gambling currently used in the field of social sciences.
(N.B. This article uses material from a paper I recently published in Gaming Law Review)
Alexandra, H. (2017). Loot boxes are designed to exploit us. Kotaku, October 13. https://kotaku.com/loot-boxes-are-designed-to-exploit-us-1819457592
Avard, A (2017). Video games have a loot box fetish, and it’s starting to harm the way we play. Games Radar, October 10. Located at: http://www.gamesradar.com/loot-boxes-shadow-of-war/
Gambling Commission (2017). Virtual currencies, esports and social casino gaming – position paper. Birmingham: Gambling Commission.
Griffiths, M.D. (2015). Adolescent gambling and gambling-type games on social networking sites: Issues, concerns, and recommendations. Aloma: Revista de Psicologia, Ciències de l’Educació i de l’Esport, 33(2), 31-37.
Griffiths, M.D. (2017). Is the buying of loot boxes in videogames a form of gambling or gaming? Gaming Law Review, 22(1), 52-54.
Griffiths, M.D. & Carran, M. (2015). Are online penny auctions a form of gambling? Gaming Law Review and Economics, 19, 190-196.
Griffiths, M.D. & King, R. (2015). Are mini-games within RuneScape gambling or gaming? Gaming Law Review and Economics, 19, 64-643.
Hood, V. (2017). Are loot boxes gambling? Eurogamer, October 12. Located at: Located at: http://www.eurogamer.net/articles/2017-10-11-are-loot-boxes-gambling
Lawrence, N, (2017). The troubling psychology of pay-to-loot systems. IGN, April 23. Located at: http://uk.ign.com/articles/2017/04/24/the-troubling-psychology-of-pay-to-loot-systems
Perks, M. (2016). Limited edition loot boxes: Problematic gambling and monetization. Cube, October 11. Located at: https://medium.com/the-cube/limited-edition-loot-boxes-problematic-gambling-and-monetization-756819f2c54f
Wikipedia (2017). Loot box (2017). Located at: https://en.wikipedia.org/wiki/Loot_box
Wiltshire, W. (2017). Behind the addictive psychology and seductive art of loot boxes. PC Gamer, September 29. Located at: http://www.pcgamer.com/behind-the-addictive-psychology-and-seductive-art-of-loot-boxes/