“The end of the British high street” is a phrase that has been used frequently by national media outlets. In recent times there has been an increasing number of companies that are in financial difficulty or being forced to shut down for good. Most likely, this is due to the rise of online shopping , but other factors such as rising costs and a poor infrastructure are also to be blamed. Despite the tense situation that the majority of high-street shops are in, many believe that they are able to overcome the difficulties they face.
We have discussed high-street shops in general terms, however, what makes us interested in is betting shops. A lot of people who are against betting have criticized the huge number of betting establishments on the typical British main street. But, do they continue to feel this way when retail stores are empty? The bookmaker might not be as appealing as artisan bakers or a boutique clothing shop however, given the problems of the modern high-street, if bookshops were gone, more than likely, shops would fall in a state of destitution. This means there would be no rental for property owners and no tax revenue for councils and government and no job opportunities for residents of the area.
Betting shops near me will continue to be an presence in our towns or is it just an issue of time until they go online? If you frequent the local book shop to place your bets, the idea of their disappearance for good could be a worrying one. Although it’s impossible to predict about the future, by looking at the current trends and information that we can make an educated prediction of the future of betting shops.
Fixed-Odds Betting Terminals Changes
Although we tend to think of the high-street shops as a homogeneous group however, each industry has its particular issues. The rise of Amazon for example, posed an even greater threat to retailers than the local grocery store (for the moment, at least however Amazon has plans for almost every aspect of retail! ).
Sometimes, the risk is due to competition , but in other circumstances, it could result from legislation that bookmakers discovered. In the year 2019 the UK government decided to cut the maximum bet limit for Fixed-odds gambling terminals (FOBT) from PS100 all the way down to PS2. This was an extremely significant change , not only from a responsible gambling standpoint but also due to FOBTs being accountable for PS1.7bn of bookmakers on the high street’ PS3.2bn annual revenue – an enormous portion.
The culture Secretary Jeremy Wright praised the move as an “significant move towards protecting vulnerable individuals” however, it could be a significant challenge for bookshops across the country. A report released in 2018 by the Association of British Bookmakers, warned that the switch to FOBTs could lead to the closing of 4500 bookshops that offer betting (approximately 50 percent). It is important to note that this report, authored by the accounting firm KPMG and was criticized by some as exaggerating the risks. In fact, Paddy Power declared that although the PS2 stake limit could be able to have “some effect” for betting establishments however it was “far more benign” as what the AAB depicted. The same view was shared by Matt Zarb-Cousinwho spoke for the campaign organization Fairer Gambling.
While groups debated the exact impact that of the proposed FOBTs regulation could have, there was no doubt that they could harm betting shops to some degree. In the end, FOBTs have for a long time been an income source for many bookies on the high street. The new rules came in full force on the 1 April 2019 and, one month later, the machine revenues were down by 40 percent. The primary issue was, and is still for bookmakers, that customers were spending less money in total, rather than using it in other places in the bookshop.
Certain bookmakers noted that there was almost no growth in the number of over-the-counter bets , while some saw a modest rise of about 10 percent. A year later in October 2020 GVC (Ladbrokes and Coral) reported that their machine revenue decreased by 36%, while betting revenue was up just 7 percent.
Prior to the change in rules, FOBTs made up 57% of the betting shop take-homes, up from 38 percent in 2008/09. This resulted in a significant loss of revenue. Paddy Power estimated that its annual losses could range between PS36m to PS47m due to the direct impact of the actions of the government. However, the Irish bookmaker was largely defiant declaring that they did not expect to be forced to shut down any of their outlets. They were not alone in this regard, despite the majority of their competitors being more negative in their forecasts. In the end, for a lot of individual shops that were affected by the new FOBT regulation was the key to determining between running at net gain or with a loss.
The beginning of a decline
After having read the above section it is no surprise that a number of bookmakers on the high streets were forced to shut down, mostly due to the new FOTB law. In October of 2020 an exclusive report published in The Mirror revealed that 460 bookmakers on the high streets had closed at the close of the previous year. This was an 12.2 percent decrease on the amount of high-street shops.
In all places, including ones that aren’t near the high street, the decrease was at 11.3 percent. Although it is a significant figure, this is much lower than what many were expecting. In fact, GVC (owners of Ladbrokes and Coral) did not end up closing half of the stores they were expecting to close by March 2020.
The Coronavirus Challenge
The changes to FOBTs have definitely been the main reason behind the closure of betting shops on high streets. Before the outbreak of coronavirus brought the country to a stop, many shops were already shut down or were in the process of closing. However, it is incorrect to assume that the difficulties of Covid-19 did not have an impact on the betting industry. In the short-term the returns fell as sports events stopped running and the long-term effect is that more high-street betting shops could close.
In August of 2020, William Hill made the decision to not reopen 119 high-street stores that were temporarily shut down due to closures for coronavirus. In announcing the decision, they said that they were anticipating “that long-term retail footfall won’t return to levels pre-COVID”. While William Hill were alone in making this decision, their forecast of footfall could be accurate. A lot of gamblers who had to go online after all local stores closed, might not be able to return to their old habits.
Like other industries the situation created by the pandemic could serve to accelerate the transition towards online betting. People who had never attempted betting online might have discovered its ease of use. Additionally, those who love FOBTs have discovered that while stakes at shops are only PS2 on the internet for the moment at least you can bet higher and choose from a wider range of games.
The number of punters is increasing. Betting on the internet
Since lockdown meant there was no chance of placing bets in their high-street shop The only alternative was to bet online. Because of the absence of sporting events, this usually involved betting on games like virtual sports or casino games such as roulette or slots, instead of actual sporting events.
Mobile Betting
It is interesting to note that this increase is due to betting on mobile devices, not bets on laptops or computers. Gambling Commission data found that between 2015 and the year 2019, there was a decrease of 25% in the number of gamblers who placed bets on their laptop or PC within the last four weeks. The number of smartphones bets during the same time frame however increased from 23 percent to 50%.
The biggest threat to betting shops on the high street nowadays are mobile apps. Each major bookmaker today has the option of both Android and iOS app that offers are regularly delivered via notifications to increase the amount of engagement. Direct advertising, when combined with features like in-play betting could be a huge help in attracting people to take an enticing game. In the end, as per the data from 2020 84% of people had smartphones, and spent on average 2 hours and 34 minutes on it each day.
The trend towards betting in-play is another reason betting shops aren’t getting. Many gamblers love the possibility to bet on the game, match or race. Mobile phones are ideal for this , but betting in-play isn’t feasible in a typical betting shop, or at least not in the traditional manner.
Are there signs of Hope?
It is clear that the combination of shifting shopping patterns, the lower profits of FOBTs, and the constant uncertainty caused by Covid implies that the high-street betting stores aren’t thriving. They aren’t completely gone however, so it’s worthwhile to ask if there’s any hope for them or is their gradual demise an inevitable event?
In the current situation as of now, we’re more likely to choose the former over the latter. Although betting shops may not make the same amount of money as they did when they were in their prime however, some still draw enough customers over time to be feasible. Some bookmakers may even think about running a shop with a loss, due to the importance of boosting the visibility of their brand and enhancing the credibility and credibility of the company. The recognition of brands and the interest in multichannel marketing are the reasons for Deloitte believes that betting stores will survive in large quantities.
There are other reasons to support the notion that high-street betting shops won’t disappear anytime soon. One of the most persuasive opinions, as stated by Susannah Streeter from Hargreaves Lansdown is that the desire to visit betting shops will continue because of the social aspects of it.
imageHOLDERS, the company that makes gambling kiosks, also agreed on this issue, stating that chat rooms online on betting websites cannot substitute for the interaction in person. They also discovered a crucial benefit of bookmakers in shops in contrast to online retailers, are happy to accept cash bets. Although the world is increasingly cash-free (another trend that has been accelerated by recent events) however, there is many who prefer having notes and coins on their hands. Furthermore, very few would argue that receiving cash in hard, cold cash is superior to having it deposited to your bank account online.
In fact, in 2020 cash payments accounted for 23 percent of all payments which is PS9.3bn in real terms. Even if that percentage decreases, and is likely to happen be, we’re still discussing billions of dollars being transferred in cash every year. It is not right to believe that some people prefer cash just a result of their inability to keep up with the latest technology.
Certain people prefer cash since it stops them from spending more money than they have. It’s worth noting that this is not as much of an advantage since people in the UK public are not able to use credit cards in order to pay for wagers. Additionally, it is the case that cash transactions are not traceable which makes it more appropriate for those who are concerned about their online fingerprint.
The Survival of the Fittest
It is important to note that we’re discussing what the future holds for betting stores as though they have the option of continuing to function the same way they are currently. However, this isn’t necessarily likely to be the situation. We have seen it in other industries, innovation may be the thing that keeps the high-street stores going.
In the event that the FOTB stake reduction came into the full swing, Paddy Power as well as Betfred tried to get around it by introducing new games based on roulette. To make sure they didn’t violate the rules, at Betfred the players had to go to the counter in order to make wagers (of at least PS500) and Paddy Power’s Pick ‘n’36 game was only played every 3 minutes. Both games were halted within a short amount of time, but even so they prove that change and innovation remain the sole constants.
The ability to think Outside the Box
The controversial attempts to circumvent the new rules are clearly not the best option and in fact, the two were criticized in the past. What it does show the fact that publishers are prepared to think a little outside of the box in the direction of increasing the level of engagement among customers. There’s no reason to think that a bookmaker can’t suggest a less controversial idea to get customers back to the shops. That’s exactly the way Ladbrokes Coral attempted to do by establishing two ‘concept’ gambling shops within Birmingham toward the end of the year.
Final Conclusion High Street Stores Closed, But They’re Never Out
While we anticipate the number of high-street betting shops to decrease in the future however, there is enough demand for many to stay. There’s plenty of reason for bookmakers to keep their an established presence on the high street, as the majority of their customers aren’t, or prefer not to, do business online.
The high street stores are also a major factor in establishing brand recognition and credibility and this aspect should not be ignored. In the end, shops that begin to provide a more upscale atmosphere are more likely to have more chance of not getting being snubbed. External factors, like changing demographics and fluctuating rents, will certainly have an impact, however, generally speaking, the top shops won’t be leaving our streets for long in the near future.
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