Gambling White Paper: advertising and marketing

The Call for Evidence

When the government published its Call for Evidence in 8 December 2020 in the context of its review of the Gambling Act 2005 (the “Gambling Act Review”), it noted that gambling advertising and marketing had expanded into new channels and had grown significantly since the Gambling Act 2005 (the “2005 Act”) came into force in 2007. Despite voluntary actions that had been taken, such as the 9pm watershed on most television advertising and the ‘Whistle to Whistle’ advertising ban around live sport, those measures had not gone far enough and vulnerable groups, the Government confirmed, were still exposed to gambling advertising. Furthermore, the public was becoming increasingly concerned about the relationship between sport and gambling.

At the time, the Committee of Advertising Practice (“CAP”) was consulting on the gambling content restrictions in the UK advertising codes and it was clear that outside of the Gambling Act Review, measures would be introduced safeguard against harms in relation to gambling advertising and marketing.

Against that backdrop, the Call for Evidence requested evidence in respect of:

• the benefits and harms caused by allowing gambling operators to advertise;
• the effectiveness of mandatory safer gambling messages in advertisements in preventing harm to consumers;
• the benefits and harms of promotional offers such as free spins, bonuses and hospitality; and
• the positive or negative impact of gambling sponsorship in sports and eSports.

The White Paper

Since the publication of the Gambling Act Review White Paper (the “White Paper”) in April 2023, its proposals on marketing and advertising have been criticised by some commentators for being too light touch – and they were relatively light touch. Perhaps that is partly because, as the White Paper confirms, the Call for Evidence submissions showed “a lack of conclusive evidence on the relationship between advertising and harm” and “little evidence of a causal link with gambling harms or the development of gambling disorder”, and partly because the government felt that the protections that had been, or could be, introduced outside of the Gambling Act Review would provide additional protection.

We have discussed each of the proposal in turn below, but we think the key actions for the industry are:

1. Adapt proactively to new marketing restrictions:
   • Review your marketing materials and strategies to see which could be affected by the upcoming restrictions, particularly in relation to bonuses and direct marketing to customers who don’t show strong indicators of harm.
   • Ensure you have clear criteria for identifying customers with indicators of harm and that your marketing approaches are adjusted accordingly.
2. Enhance your customer consent mechanisms:
   • Review your customer sign-up processes to ensure you are obtaining explicit and informed consent for direct marketing, and consider how you will transition to giving customers the ability to opt-in for individual gambling products rather than requiring a blanket consent.
   • Review technology solutions to facilitate easy customer opt-out options and modifications to marketing preferences.
3. Safeguard against marketing to vulnerable groups:
   • Consider investing in age-verification systems and implementing algorithms that prevent young and vulnerable groups from being targeted by your gambling advertising.
   • Regularly review and adjust your targeting criteria on all platforms, including social media, to avoid reaching these groups.
4. Ensure your free bets and bonuses are socially responsible:
   • Review the structure and terms of all promotional offers to ensure clarity, transparency, and an emphasis on social responsibility.
   • Consider how you will implement limits and enhanced transparency on re-wagering requirements, and time limits for bonus offers, ahead of any new restrictions.
5. Leverage data for socially responsible targeted advertising:
   • Use data analytics to better understand the behaviour of your customers and prevent the targeting of those showing signs of problem gambling.
6. Prepare for new safer gambling messaging:
   • Consider how you will adapt to the transition away from return to player (“RTP”) metrics to more understandable expressions of odds and potential losses.
7. Prepare for the new sports sponsorship Code of Conduct:
   • Review your sponsorship agreements for adherence to the forthcoming cross-sport Code of Conduct.
8. Engage with the upcoming consultations:
   • Participate actively in consultations and discussions regarding the new law regulations to ensure the industry’s perspective is heard and to stay ahead of compliance requirements.
   • Form or join working groups with other operators to share best practices and develop industry-wide strategies for dealing with the proposed changes.
9. Educate and train your staff on changes and updates:
   • Ensure your staff are thoroughly trained on any changes to regulation and safer gambling practices.
10. Manage and audit your policies and processes:
    • Perform regular audits of compliance with the new requirements and adjust policies and procedures as needed.

Bonuses and direct marketing

Restrictions on marketing to customers who do not demonstrate strong indicators of harm

The White Paper noted that bonuses, promotional offers and direct marketing are the forms of advertising that are most likely to impact gambling behaviour, and that those at the greatest risk of harm have the highest exposure to this form of marketing.

In accordance with Requirement 10 of the Gambling Commission’s customer interaction guidance, operators should already prevent direct and targeted marketing and the take up of new bonuses by customers who show strong indicators of harm. The White Paper suggests that the Government does not think this goes far enough, and that restrictions may be imposed in relation to marketing to customers who don’t show strong indicators of harm. Whilst those restrictions will be subject to consultation before they are implemented, operators may wish to consider how they would be able to justify that sending direct marketing to any single customer was appropriate and evidence that the customer was not displaying markers of harm.

The Government is clearly concerned about free bets and bonuses and their potential to encourage harmful gambling.  Despite the industry going through a full investigation by the Competition and Markets Authority (“CMA”), which brought widespread change to the way promotions could be conducted, the Gambling Commission will revisit this area and will consult later this year on free bets and bonuses and ensuring they are constructed and targeted in a socially responsible manner, as well as a cap on and increased transparency around re-wagering requirements and the use of time limits before bonus offers expire. Similar restrictions have been introduced across Europe and it seems inevitable that some restrictions will be introduced. As such, operators should review their free bet and bonus offers and consider how those could be made more ‘socially responsible’ and whether their terms are clear enough for an ordinary punter to understand. 

For now, there will be no further restrictions in relation to online or land-based VIP/high value customers (“HVCs”), as the controls that were introduced by the Commission in 2020 appear to be adequate. 

The message from the White Paper is clear; operators must conduct their direct marketing strategies in a socially responsible manner, otherwise policy may be directed towards a tightening of restrictions in the coming years. Whilst this is more applicable to online operators, given the Government’s stance that current controls on land-based operators in this area are adequate, all operators should also take this advice on board.

Direct marketing consent and opting-in to offers

There are already clear requirements in place that operators must seek informed and specific consent to send direct marketing to consumers, as well as that direct marketing must not be sent to those who have self-excluded or are showing strong signs of harm. However, given the Government’s comments on the dangers of ‘cross-selling’ (for example, giving free online slots spins to sports bettors or heavily marketing casino products to bingo players), particularly where a more ‘high risk’ product is offered, it seems likely that the Commission’s recent consultation, which closed [BB1]on 18 October 2023, will result in:

• compulsory opt-ins for each individual gambling product so that consent is not bundled together for all products, with the aim of reducing cross-selling;
• implementing systems to allow players to change their marketing preferences at any time; and
• clearer consent at sign-up so that marketing consent is not bundled with broader terms and conditions, making consent to receiving marketing communications more explicit.

These changes will be brought about by updates to the LCCP in due course, and could have a significant impact on an operator’s customer journey/user experience and ultimately the ability for operators to extract value from their customer database.

Making online advertising smarter and safer

Online advertising technologies have advanced significantly since the 2005 Act came into force and data-driven advertising techniques are now widely employed by gambling operators. The White Paper clearly evidences the Government’s growing concern that these technologies increase the likelihood of advertisements being targeted at vulnerable customers, who are also more likely to spend money as a result of seeing them.

The White paper proposes two packages of reforms to make online advertising smarter and safer: a stronger and more comprehensive approach to targeting and content standards from operators, and a range of online platform safety measures to make it easier for individuals to reduce exposure to gambling content and access support. Operators are encouraged to make use of available technology to extend commitments to de-targeting children and vulnerable people and age-gating social media, for example by using stricter algorithms in their automated advertising campaigns.

Second, the government proposes safety measures for online platforms to allow individuals to reduce their exposure to gambling content, for example by enabling one-click opt-outs from gambling advertisements and signposting users to support pages where their search history suggests they may be struggling with gambling problems.

Safer gambling messaging

‘Safer gambling messaging’ covers three strands:

• information provided to consumers at the point of use for online and offline products, such as the return to player (“RTP”) percentage displayed on machines;
• messaging embedded in advertising, such as signposting to ‘begambleaware.org’ in broadcast adverts, or the industry’s ‘Take Time to Think’ campaign; and
• awareness campaigns, such as GambleAware’s Bet Regret campaign.

The Government is taking safer gambling messaging out of the industry’s hands and giving it to statutory bodies. The evidence presented in the White Paper, the Government states, suggests it would be beneficial to develop systematic messaging, independently from the industry, to maximise the information available to consumers and enable them to make informed decisions with a better understanding of its risks.

To achieve this, the Department of Health and Social Care (“DHSC”), DCMS and the Commission will work together, drawing on public health and social marketing expertise, to develop a robust approach to informational messaging throughout the user journey, replacing industry owned safer gambling messaging.

Once the messaging has been framed, a period of consultation will be undertaken with operators on how to apply the new messaging appropriately. Future changes may include:

• moving away from RTP metrics which many players do not understand, instead requiring operators to express odds in terms of money lost (e.g. £7 for every £100 based on average); and
• removing vague safer gambling messaging and instead referring to specific harms that gambling may cause.

In the short term, the White Paper confirms that the Gambling Industry Code for Socially Responsible Advertising (“IGRG Code”) will be updated to extend the British Gaming Council’s (“BCG”) commitment that at least 20% of all TV and radio advertising space is dedicated to safer gambling messaging to include online advertising space. Although commitment to the IGRG Code only has ordinary code status (and a lack of commitment can therefore only be taken into account in the context of wider regulatory action by the Commission), we would encourage licensees to demonstrate good practice and to implement it.

Socially responsible sport sponsorship 

Several measures have already been taken on a voluntary basis by the sports industry to avoid legislative restrictions on gambling sponsorship in sport, including the Premier League’s removal of gambling logos from the front of shirts from the end of the 2025/26 season. The Government is clear that gambling sponsorship deals provide the sports industry, particularly at grassroots level, with a critical source of funding (gambling sponsors contribute around £45 million each year across the English Football League’s three leagues, and also account for a significantly higher proportion of overall revenues in the Scottish football leagues). As such, the White Paper does not propose any legislative amendments to restrict gambling sponsorship in sport.

All sports are, however, expected to take a responsible approach to gambling sponsorship and support the sector’s efforts to implement minimum standards for social responsibility through a cross-sport Code of Conduct, which will be developed by the sports bodies. The key principles for that code will be:

1. Kits: introducing kits without gambling sponsor logos for athletes aged under 18 or adults who object to the sponsor on religious or health grounds and replica kits without logos in adult sizes;
2. In-stadium advertising: ensuring gambling advertising is not visible from dedicated in-stadium family areas;
3. Safer gambling messaging: a proportion of sponsorship inventory to be used for safer gambling messaging; and
4. Licensing: a commitment for clubs to only accept sponsorship from licensed gambling operators.

Operators should look out for developments in relation to the Code of Conduct and bear those changes in mind when considering their sponsorship agreements to understand how those might be affected. We would also encourage operators to take up any available opportunities to feed the operator perspective in to those preparing the code, either directly or through existing relationships with governing bodies and other stakeholders.

If you’re interested in discussing how these proposals might affect you, please do get in touch. You can also read our general summary of the gambling White Paper here.