- May 03, 2023
- 4 minutes read
The role of payments in strengthening online sportsbooks’ relationships with VIP customers
High-stakes sports bettors are arguably the most important customer segment of online sportsbooks. Referencing our recent ‘All the ways players pay’ research, Zak Cutler, Paysafe’s President of Global Gaming, argues that payments are key for both converting and retaining these coveted customers.
An online sportsbook’s customer base is often mostly comprised of players who wager casually and relatively infrequently. That said, it’s essential that operators also cater to their VIP customers who wager higher amounts and more often. After all, while VIP players tend to make up a smaller percentage of an operator’s overall player base, the revenue they contribute is much higher.
When it comes to engaging VIP players, operators need to leverage a different approach to the strategies they deploy with casual bettors. And a bespoke experience for high-stakes online sports bettors will prove essential when converting and retaining these coveted customers – especially when it also focuses on payments.
In fact, our research indicates that VIP sports bettors prioritize the payments experience when both selecting a sportsbook and, over time, reassessing whether to continue wagering with a particular brand.
For our 2023 All the ways players pay research report surveying U.S., U.K. and Ontarian players, we categorized sports bettors as VIPs if they wagered either 5-7 times a week or more than 7 times weekly. The research revealed that nine out of 10 (91%) of VIPs betting 7+ times a week had a favorite sportsbook, and this trend is even more pronounced for those gambling 5-7 times weekly, with 94% of these players having a preferred iGaming brand.
Above all, it’s essential for these sportsbooks to provide an optimal payment experience if they are to ‘win’ these players. What does a strong payments experience mean for a VIP? For an online sports bettor placing more than 7 wagers a week, fast and smooth payouts are essential, with this the most important criterion (for 34% of these players) when selecting an online sportsbook.
For VIPs wagering slightly less frequently (5-7 times a week), payments are also an essential factor for why they choose to wager with a brand. Aside from brand trust (prioritized by 33% of such players), quick and frictionless deposits are the most important consideration for those wagering 5-7 times a week.
Whether it means streamlined deposits or rapid, effortless payouts, operators will only maximize their conversion of high-value VIPs if they get payments right.
It should also be emphasized that VIPs tend to have more online sportsbook accounts than casual players. With our research indicating that a VIP has around three accounts compared to less than two for a casual player, there are significant acquisition opportunities for operators to take advantage of. That said, the situation does place pressure on operators to retain the relatively fickle VIPs and not lose them to a competitor brand.
Defining the VIP payment experience
What sort of payment experience does a VIP want beyond fast and frictionless payouts and deposits? For the most frequent online sports bettors (7+ wagers a week), being able to fund a bet and cash out with their preferred payment method is essential when choosing a sportsbook.
Guaranteed acceptance of deposits is also a key consideration – considered vital by 40% of the most frequent bettors (7+ bets a week) and 38% of those gambling almost as frequently (5-7 times weekly). In consequence, it’s essential for operators to minimize card declines.
Interestingly, while cards are an important payment method for VIPs, those wagering 5-7 times weekly place equal importance on the alternative payment method (APM) of digital wallets as they do on debit cards – with wallets and debit cards the joint favorite payment method of this cohort (41% of these players for both payment solutions).
Digital wallet usage is also very high among those wagering most frequently (7+ times a week). Six out of 10 (60%) of these VIP players with a digital wallet account say they always use it to fund and cash-out with online sportsbooks.
The reasons for this preference are diverse. More than a third (35%) consider digital wallets more secure than other payment methods and favor the fact that solutions like Skrill and NETELLER ensure that users don’t have to share financial info with sportsbooks. The ability to rapidly if not instantly fund a wager is also important, with almost as many VIPs (33%) emphasizing this.
VIP player retention
A major takeaway from our 2023 research was that if a high-stakes VIP customer is disappointed by their payments experience, they will very likely abandon the book for a rival that is transactionally superior.
If a VIP has concerns about the security of a financial transaction with an iGaming brand, over half (55%) would not move forward with the deposit. Almost as many VIPs (51%) would abandon a transaction if the book asked them to give too much financial info. In short, if operators don’t get the payments journey right, they will see these high-value players fall short of becoming depositing customers.
Overall, operators need to provide an unparalleled payment experience to VIP players, including a comprehensive suite of APMs in tandem with traditional payment options. With over eight out of 10 (84%) VIPs saying that payments are a key factor in why they stay with a sportsbook or leave it, iGaming brands cannot afford to disappoint arguably their most important customers.