The betting industry is divided over the use of marketing tactics by bookmakers and whether it has a negative impact on the sport.
The espn sport betting is a bookmaker who has started to use a marketing tactic that divides the betting industry.
It was a terrible beat in gambling terms. After testing positive for COVID-19, Jon Rahm, who was leading the Memorial Tournament by six strokes after the third round, was forced to withdraw.
He was a 12-to-1 betting favorite going into the last round, and he would have been an odds-on favorite going into the final round. The sports betting world was in turmoil when word of his withdrawal circulated on Twitter — but not because of the devastating loss.
Around 8 p.m. on June 5, the largest bookmakers in the United States started issuing refunds to everyone who had bet on Rahm.
Bad beat refunds, as they’re known, have been a lucrative marketing strategy for foreign bookmakers for decades. They’ve helped certain bookies acquire recognition and helped sportsbooks gain notoriety when they first launched in new markets.
They operate like this: bookies, seeing a public relations opportunity, capitalize on a contentious result and refund lost bets on the event. Refunds are often provided in site credit and are not immediately accessible for withdrawal.
“The PR value is far greater than anything they could do,” said Scott Ferguson, a betting industry veteran based in the UK. “It reaches both ends of the sheet of paper. It isn’t only for pure gamblers who come to watch it. It is visible to everyone.”
However, not everyone is pleased with what they see.
While poor beat refunds are frequent in more developed markets, they upset bettors in the United States, split old-school bookmakers from the new breed, and even raise worries about responsible gambling and potential lawsuits. All because bookies have the audacity to effectively refund gamblers’ money.
Refunds face backlash
On the surface, it’s hard to see why a bettor would be angry if a bookmaker refunded a lost stake. After all, money appeals to everyone. Some gamblers reacted angrily when bookmakers like FanDuel advertised that they would refund any lost bets on Rahm in the form of site credit.
Bad beat refunds have irritated professional bettors in particular since they’ve grown increasingly frequent in the United States.
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“I still believe it boils down to fairness,” remarked professional gambler Rufus Peabody. “People will get enraged if they feel that someone else is being treated differently than they are. And I believe that’s what operators aren’t considering, which may have severe repercussions down the road.”
Rahm was favored by Peabody to win the Memorial Tournament. However, none of his wagers were made with bookmakers that offered refunds. What a dreadful beat.
Peabody was able to shrug off his disappointment, mostly because he knows the sportsbooks he wagers with have larger limits, which is more significant to him than a random reimbursement of a lost bet. Even yet, Peabody admits that it may be unsettling to see bookies who have either restricted him to little sums or shut him off completely launch a marketing campaign around reimbursements.
“People don’t enjoy paying taxes,” he said, “but what you really detest is seeing your neighbor not paying his taxes and getting away with it.”
Professional bettors also believe that paying out on lost bets cheapens their business and makes it seem gimmicky. The reimbursements were likened as “participation trophies” by many serious gamblers.
Ed Miller, a Las Vegas-based sports bettor whose firm Deck Prism provides live odds to sportsbooks, said, “There’s an American cultural element to it, arrogance.” “[Professional bettors] take the game more seriously, and they want others to share their perspective. That, in my opinion, is where a lot of the reaction comes from.”
Controversial, but indisputable exposure
After a contentious no-call in New Orleans’ NFC Championship Game defeat to the Rams in 2019, one bookmaker garnered instant attention by providing credits on wagers. Gerald Herbert, File/Associated Press
PointsBet, an Australian bookmaker, had barely been in the United States for three days when it irritated its rivals by issuing its first poor beat refund.
After the Los Angeles Rams defeated the New Orleans Saints in a contentious NFC Championship Game on Jan. 20, 2019, PointsBet’s “Karma Kommittee” got to work. Saints bettors were mistreated by a crucial missed pass interference call, according to the Kommittee, an internal committee of marketing executives and traders, and money-line bets on New Orleans will be reimbursed in site credit. Instead of a total loss, you would have $20 in free bets if you had placed $20 on the Saints to win the game.
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The phone began ringing for PointsBet CEO Johnny Aitken soon after the decision was made. Rival sportsbook executives were irritated and wanted to speak with the newcomer.
“They were telling me I was crazy for doing this and that I was establishing a new precedent in America,” Aitken said. “They predicted it would come back to bite PointsBet and the industry.”
The following day, Aitken saw the PointsBet logo all over the news. The story was covered by USA Today, the Associated Press, and the New York Daily News, among others.
“It was essentially our first foray into the United States,” Aitken said. “It had the intended impact for us, and it had the desired effect for our consumers,” says the author.
Two years later, the practice of randomly refunding lost bets is widespread, even at some of the same sportsbooks that had chastised PointsBet for its first Saints refund, according to Aitken. However, not all bookies are on board.
Derek Stevens, the owner of a Las Vegas casino, sees both sides of the argument.
Stevens opted to refund all bets on the Packers after the Seattle Seahawks beat the Green Bay Packers on a disputed last-play touchdown catch on Monday Night Football in 2012, stating at the time, “I know exactly how it would feel if I was laying the number and watched what occurred.”
However, Stevens and his bookmaker Circa Sports decided not to reimburse Rahm a decade later.
In June, Stevens told ESPN, “We felt it was going to lead us down a rabbit hole we didn’t want to go down.” “We felt extremely confident in stating that we understand our business strategy.”
“For certain sportsbooks, this kind of situation provides some opportunity, some potential to give some good will to consumers, and then obviously you get a lot of PR and media value out of it,” he said, “and for others, it makes no sense.”
The biggest online sportsbooks in the United States think that poor beat refunds are worthwhile. FanDuel, DraftKings, BetMGM, Caesars/William Hill, and BetRivers all provided Rahm with refunds or outright payments.
Since its debut in 2018, FanDuel, which by most measures is the biggest sportsbook provider in the United States, has given more than 20 poor beat reimbursements. According to the firm, the amount of responsibility on the market in issue, as well as how much attention the specific incident is expected to create, are taken into account. The most important criterion, according to Mike Raffensperger, FanDuel’s chief marketing officer, is “Was the end result less enjoyable as a result of this? Did it seem as though you were being treated unfairly?”
Raffensperger said, “We’ve given out many, many millions of dollars [on reimbursements].” “We aim to be a generous, bettor-friendly sportsbook, and this is one of the methods that will help us achieve that goal.”
‘An encouragement to take greater risks.’
Bettors aren’t the only ones who are concerned about the reimbursements for poor beats.
Some proponents of responsible gambling criticized the practice of refunding wagers in the form of site credit rather than cash.
In the case of Jon Rahm, not everyone is on the same page when it comes to refunds or credits. Darron Cummings/AP Photo
After the Rahm reimbursements, Steve Ruddock, editorial director for industry site Bettingusa.com and editor-in-chief for Gaming Law Review, said in an essay, “Sportsbooks seeking to retain clients are welcome to give out all the free money they want.” “A ‘winning bet’ with strings attached, on the other hand, isn’t a victory. It’s just an encouragement to risk more, whether or not the individual wants to.”
Other responsible gambling experts disagreed, pointing out that bettors who lose money due to unforeseen events may get upset and try to make up for their losses by betting more than they should. Brianne Doura-Schawohl believes that the reimbursements may help alleviate some of the angst.
“I’m glad that some individuals are considering these business choices in the perspective of responsible gaming. I’d want to see more of it in the future “Epic Risk Management’s vice president of US policy and strategic development, Doura-Schawohl, said. “However, I don’t think this specific case of a payment due to a highly unusual anomaly or event will have a major impact on gambling addiction.”
As the director of audience at XLMedia, a worldwide publishing company with affiliate agreements with sportsbooks, Jason Ziernicki has been watching the new regulated U.S. sports betting industry take form. He is concerned that the unpredictability in when, how, and why bookmakers give refunds may lead to legal action.
“I’m not sure whether you’ll be able to keep doing that as time goes on and prevent what we see a lot in this nation — a possible litigious situation,” Ziernicki added. “We’ve gone a long way to have sports betting regulated… let’s not squander it.”
Options that are always changing
In 2008, one bookmaker bet on Tiger Woods to win the PGA Championship after the third round, only for Y.E. Yang to come back and win. Getty Images/AFP/Timothy A. Clary
For decades, bookmakers in Europe have effectively utilized poor beat refunds, often known as “justice refunds” outside of Europe, and early payments. After Manchester United’s Premier League collapse at the turn of the century, they really took off.
“I believe they’re used a lot by bookmakers to demonstrate that they’re on the side of the punter, which clearly isn’t the case given the structure of the business,” said Harry von Behr, managing director of Spotlight Sports Group, a U.K.-based publisher specializing in betting material.
The fall of Manchester United in the Premier League at the turn of the century, according to Von Behr and others in the UK betting business, was one of the first early payments by a bookmaker to get significant media notice.
In 1998, Fred Done, a Manchester United supporter and proprietor of the Betfred sportsbook in the United Kingdom, decided to pay out bets on his favorite team early, when they were 12 points ahead of Arsenal. Arsenal came back late in the season to win the Premier League. Betfred paid out to Arsenal fans on top of what they had previously paid out to Manchester United fans. It allegedly cost £500,000 to publish Done’s book, but it also gained worldwide attention.
The early payment changed Done from a bookmaker that no one had ever heard of to one that was instantly recognized across the globe, according to Ferguson, an experienced betting analyst in the United Kingdom.
Ferguson said, “That was essentially the huge kickoff to grow his company.”
Done’s example was copied by other European bookmakers. Paddy Power, an Irish bookmaker, bet early on Tiger Woods to win the PGA Championship after the third round in 2008, only for Y.E. Yang to win the event on Sunday. Paddy Power bet early on Hillary Clinton to win the 2016 US presidential election, which Donald Trump eventually won.
“Everyone likes a tale about bookmakers making a mistake,” Ferguson added.
Some will be grateful, while others will be disappointed, but bad beat refunds seem to be here to stay as the legal sports betting market in the United States takes form. They may, however, change.
PointsBet, the Australian bookmaker that earned its name by refunding Saints bets in the 2019 NFC Championship Game, has experimented with providing clients “good karma tokens” and enabling them to select when they get a refund on a losing bet.
“It’s possible you got out of bed on the wrong side of the bed and supported the New York Knicks,” said Aitken, the CEO of PointsBet. “Or a particular player’s injury costs you money, or a certain celebrity was in the front row and distracted a Lakers player, and you believe that’s a poor beat. What I mean is that you’re essentially taking the choice out of the hands of the company and placing it in the hands of the customer. That excites us tremendously.”
New gamblers won’t remember a period when early payments and poor beat refunds weren’t a part of the game, according to Alun Bowden, a gaming industry expert in the United Kingdom. Bowden does not believe this is inherently a negative thing, especially in the United States.
“I believe this makes a generation of bettors who grew up in the somewhat more masculine culture of U.S. betting feel like individuals are getting too easy a ride, and it all seems a little bit like a ‘participation trophy,’” said Bowden, a senior consultant for research company Eilers & Krejcik Gaming. “However, from this side of the water, the open opposition to what is really simply excellent customer service seems a little strange. Essentially, the bookies are saying, ‘We don’t want to accept your money that way, try again.’ What’s the big deal about that?”
Depending on who you ask.
The where does espn get their odds is a question that has been asked by many people. ESPN uses an online betting company called Paddy Power to provide the sports gambling information.
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