Gambling Research Review

You wouldn’t know it, but there’s actually a lot of gambling research out there. The reason I haven’t pulled the trigger on self-funding a PhD is that most of it goes completely unnoticed.

To be fair, that’s because a lot of it is niche and slightly boring. Presumably the richest seams of investigation have been mined and we’re now in the phase of learning more and more about less and less.

Here are three recent examples from the Journal of Gambling Studies:

Some Canadians spent eight years tracking gambler awareness of their equivalent of GamCare (and related services), and they found that there has been a steady increase in knowledge among regular customers. However, most people still don’t really know about them or what they do, so a lot more has to be done to promote harm minimisation.

It’s a bit like how smokers don’t flinch if there’s a picture of tumour-ridden lung on their packet of cigs. It makes the industry feel a bit better about what they do, and appear to care, whilst actually having minimal impact on profits.

Meanwhile, some Australian academics looked at whether the closure of brick-and-mortar casinos during lockdown has had any impact on gambling behaviours. They simultaneously measured states with and without restrictions and found a slight decrease in engagement where live gambling opportunities were limited.

That seems like a pretty obvious finding, because it’s substantially harder to play roulette when the croupier is in the local ICU. Nonetheless, the gambling reduction was only temporary, and problems were found back at normal levels not long after the venues reopened. Also obvious.

Finally, a group of Italians carried out an investigation into loss chasing. The results were still predictable, but at least they were borderline interesting. Firstly, it was found that loss chasing can cause cognitive distortions like losing track of time. Being in a financial hole can be very stressful, so it’s no surprise that brain function becomes impaired.

But they also found that the severity of a gambler’s problem didn’t predict whether they would chase their losses. It seems the presence of the Gambler’s Fallacy or Illusion of Control are a better way to identify if a gambler is likely to keep digging when they’ve got themselves in a hole.

Basically, loss chasers are the ones that don’t realise they have no agency over the game and believe that their luck is going to turn soon after a nasty run of losses. The Italians believe this information could come in handy when tailoring treatment for gambling problems, and I tend to agree.

There are good studies though, and when they come along, they tend to make the news. Just like the one I read about in the Guardian today.

Some folks from the University of Bristol decided to look at how gambling venues are geographically located around the country. They found there is a significant skew towards targeting poorer areas.

The 10% of poorest areas in the country accounted for 21% of the more than 10K gambling premises. So that means Glasgow and Liverpool are the places to go if you fancy doing a high-density crawl of Fixed Odds Betting Terminals.

Conversely, the richest 10% of the country have only 2% of the gambling sites. So good luck if you’re looking to blow your Universal Credit in Beaconsfield or Harpenden.

In truth, this isn’t a surprise finding. It fits exactly with what we know about the psychology of gambling. The people with the least to lose (and most to gain) are the ones that are most likely to seek out risk.

But it’s fascinating to see it quantified so clearly. It’s a great example of how underlying data can reveal the truth if someone takes the time to comb through it. This is clear and compelling evidence that gambling companies are deliberately focusing their resources on targeting the poor.

The response of the industry’s Betting & Gambling Council was defiant and utterly tone deaf. In short: “You anti-gambling people are stupid. We create lots of jobs and pay lots of tax”.

It might seem like it sometimes, but I’m not anti-gambling. I bloody love it. But I am against designing addictive products that disproportionately ruin the lives of people who already have enough challenges in their lives.

Unfortunately, as the Australians found, the solution isn’t as simple as closing venues and making it harder to gamble. Online gambling is so prevalent now, that eventually the customers of betting shops, casinos, arcades and bingo halls will move online.

The government will need to implement more creative (and effective) solutions and prevent this cynical targeting in the first place. I’ve already written about how that might work, but I would go a lot further in terms of product design and availability.

The review of UK gambling laws is due any time now, and as this article points out, is already well overdue. I just hope this latest insight is not overlooked.

Bobby’s Bets

I’ve been pretty slack with my betting in the last few weeks, because frankly the Olympics and The Hundred are rubbish events to bet on. But the Premier League is underway and England still have three tests to endure against India, so I’ll probably be more active now. I already had a £20 win on India in the second test and £7 profit on Lukaku scoring against Arsenal, so I have a little bankroll to burn.

3 thoughts on “Gambling Research Review

  1. Bob, I’m skeptical of the conclusion reached from the study (or your interpretation). I can’t argue that there are more casinos in poorer areas; that’s just a matter of fact. But I’m not sure it’s entirely because casino operators are “targeting” poor people. I can think of plenty of other explanations. Off the top of my head, I would guess that buying land in poorer areas is cheaper; wages for staff are lower; there are more people willing and available to take these (possibly low-paying) jobs; there is less community resistance. In America, the vast majority of casinos are not in urban areas, they are usually in suburbs because the government will not zone property to allow a casino in a “high rent” district. (There are exceptions, like London, Philadelphia and Detroit.) It’s classic NIMBY behavior — they believe the casino will drive down property values so they give them a barren tract of land a bit outside the city center or they push them to an area of the city that’s perceived as needing a boost. While there undoubtedly is *some* targeting going on, I don’t think it’s right to interpret casino locations as the way it’s done. It’s a lot more complicated than that.

    Like

    1. Hi Scott, thanks for a really interesting comment! I think you’re right about a lot, but it seems a slightly narrow perspective. The US brick and mortar gambling industry might still be dominated by casinos, but in the UK they make up a fraction of our opportunities to gamble. Between lottery terminals, slot machines and high street bookmakers, I could be gambling in a dozen different places within a ten minute walk of my home. I think it’s likely that operators originally rolled out their products indiscriminately, and over time, survival of the fittest has meant there are more venues flourishing in poor areas than rich ones. That is a reasonable explanation for the skew of data found in the research. But over decades of offering these products, I think it’s highly implausible that gambling firms have not realised the correlation between their successful venues in poorer areas and the ones that closed in richer areas (where, although costs were higher, there was not enough demand for what they were offering despite the potential clientele having more disposable income). With that important bit of insight, I further find it unlikely that the folks in charge of rolling out new venues did not lean towards the areas where they have seen the most success – which were almost invariably in poorer places. Without doubt, this information is informing the tone and content of marketing strategies. Here, football (a working class game) is the persistent hook and cricket/rugby (traditionally middle class games) are overlooked. The celebrities that are chosen to represent the gambling companies are never selected to appeal to the wealthy. There are no yachtsman or polo players urging us to place bets. Maybe I’m giving operators too much intellectual credit in saying they deliberately target the poor, and they just happened upon this successful strategy by accident. In my career I certainly stumbled across things that worked without understanding why, so it’s possible. Or at least it was ten years ago. In gambling research it’s now widely understood that the poorest are the most susceptible, either because of their financial state or due to other consequences of being economically disadvantaged. We know this to be true in psychological research, and the data is bearing it out in the world’s most mature gambling market. Going back to the USA, where the industry is only now liberalising and booming, the lessons the Brits have learned by trial and error are almost certainly now forming the playbook. Even if NIMBY zoning laws prohibit setting up physical locations in vulnerable communities, the marketing will make it clear what is happening. This geographical study is just a piece of the puzzle. Left unchecked, the poor will get poorer and society will suffer. There have to be hard protections on maximum spend, and harsh penalties on the companies that deliberately exploit their customers.

      Like

  2. Thanks for the thoughtful reply, Bob. When you expand the picture to include FOBTs, sports betting outlets, lottery terminals, etc., the analysis makes more sense, though I still expect that cost overhead is an important part of the decision. The American gambling industry doesn’t have FOBTs and until recently has had no sports betting outlets (with just a few exceptions). Sports betting until the last 2-3 years was underground/illegal except for in Las Vegas; even with sports betting licensing happening in 15 or so states, the places to bet are mostly limited to casinos. I’m not aware of any state which currently allows for Main Street (High Street) retail betting shops. We do have lottery games available pretty much everywhere in almost every state. That Nevada (!) is one of the five states with no lottery is a measure of how fucked up gambling legislation is. Of course in many of these states the whole picture will change as sports betting Apps take hold (they’re not legal everywhere) and location of physical facilities makes no difference. In New Jersey and many other states, all gambling licenses (online and b&m) are granted through the handful of live casinos. I’m only aware of *one* non-casino-based sports betting facility in the entire state, which is located on the grounds of the stadium sports complex in East Rutherford. The laws are designed to protect the interests of the existing casinos. I know it’s a lot more widespread in the UK, but is it really free reign, with the operators deciding where to open all facilities? Oh, and I disagree with the idea that US regulators learned anything from the UK (or anyone else’s) trial and error. The US governments pretty much insist on making their own mistakes when it comes to gambling and everything else.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s