There’s no such thing ASA certain result

Introduction

Recently, the ASA upheld a complaint from two members of the public in relation to a TV advertisement for Sky Bet’s bet creation product[1].

The advertisement promoted a betting service and featured a popular pundit and TV presenter, Jeff Stelling, who said the following:

“Forget ‘anything can happen’, in sport anything does happen. But could it be better? With Request a Bet it could. Spark your sports brain and roll all the possibilities into one bet. Three red cards, seven corners, five goals: let’s price that up. Or browse hundreds of request a bets on our app. The possibilities are humongous. How big is your sports noggin? Sky Bet, Britain’s most popular online bookmaker. When the fun stops, stop.”

The complainants alleged that advertisement implied (through the use of claims such as “Spark your sports brain” and “how big is your sports noggin?”) that punters’ knowledge of sports could lead to success in betting.

It might be added that, because it was a television advertisement, the script required approval from Clearcast prior to broadcast, and was cleared. So Sky Bet must have had some confidence in thinking that the complaints would be dismissed.

Sky Bet’s defence

Sky Bet defended the matter on two grounds. First, they said that as a matter of fact there were only two references to the use of “knowledge” in the advertisement. Both of these referred to the use of knowledge not directly to improve the chances of winning, but rather to build an attractive combination of bets. This point was self-evidently true from the script (see above), but was apparently ignored in the ASA’s ruling.

Second Sky Bet pointed out that, even if the references to sporting knowledge were said to refer to improving the chances of winning a bet rather than simply constructing an attractive accumulator, this was hardly misleading since, as a matter of fact, customers with greater skill and knowledge of sport would be more successful at gambling than those without such knowledge.

The ASA still upheld the complaints, however. This is what it said:

The ASA considered that, taking all those elements into account, the ad placed strong emphasis on the role of sports knowledge in determining betting success. We acknowledged it was the case that those with knowledge of a particular sport may be more likely to experience success when betting. However, we considered that the ad gave an erroneous perception of the extent of a gambler’s control over betting success, by placing undue emphasis on the role of sports knowledge. We considered that this gave consumers an unrealistic and exaggerated perception of the level of control they would have over the outcome of a bet and that could lead to irresponsible gambling behaviour. We therefore concluded that the ad breached the Code.

Analysis

This ruling feels ‘odd’ (to say the least) to anyone involved in the gambling industry. But in order to understand why, one has to analyse the ruling line by line:

“The ad placed strong emphasis on the role of sports knowledge in determining betting success. However, we considered that the ad gave an erroneous perception of the extent of a gambler’s control over betting success, by placing undue emphasis on the role of sports knowledge”

This seems an incorrect conclusion based on Sky Bet’s first observation – namely that its advertisement highlighted the skill to be used in bet selection, not bet success. That probably means that the complaints should not have been upheld.

But let us assume that the advertisement had in fact specifically made such a claim – e.g. “if you have greater knowledge of sport, you will be more successful at betting with Sky Bet”. Would that have been misleading?

Success in gambling involves the correct prediction of the unpredictable or unknown. Some forms of gambling are wholly chance based, and therefore predicting the result is not susceptible to the use of skill or knowledge. A good example is a lottery. It is true that a customer may use some forms of skill to try to select numbers which, because of their inherent unpopularity, are more likely to net a unique jackpot than a shared one, but everyone recognises one player’s numbers choice of numbers in the weekly draw has the same chance as everyone else’s. There is no room for skill to play a part in the result. Try as hard as we may, no amount of mathematical assessment or study of past results will give us an advantage.

There are other forms of gambling games where the ability to use skill and knowledge can improve one’s chances against an unskilful player even though there are artificial elements of randomimity which the players must assess. The player who best weighs those factors will generally prevail over the less able players. A good example is poker. In other words, we accept that just because there is some chance factor in a game, does not mean that it is not capable of being played with more or less skill.

Finally, there are forms of gambling in which skill is the only factor which makes any difference to the result. Betting on real world events falls into that category (provided that such an event is not itself inherently random (like betting on a dice throw or lottery balls).

Let me re-state this point clearly: in betting on real world events, such as sports results, the only thing that can distinguish the level of success of one player from another is their exercise of skill. To put the point another way: if there are two people wagering against each other, one of whom uses skill and knowledge and the other merely selects at random, the knowledgeable gambler will over time be more successful than the random selector. In the medium to long term, the only factor which can elevate one player’s success over another, is the use of skill.

So the ASA’s assessment that “the ad placed strong emphasis on the role of sports knowledge in determining betting success” is surely a feature of the advertisement which should be applauded for its accuracy, rather than being criticised as misleading.

Pausing there, to look at things from the other perspective, can you imagine the reaction to a gambling advertisement which stated “studying form is over-rated – have a go, and with lady luck on your side, you’ll probably do better than our expert panel!” Indeed the ASA’s codes have a specific section (16.3.15) which prohibits any advertisement which “exploits cultural beliefs or traditions about gambling or luck”. So presumably the ASA would be very critical of any advertisement which distorted the reality of gambling so as to give a misleading picture of the role (or indeed actual existence) of “luck”.

The second part of the ruling

This is what the ASA said in the second part of its decision:

“We considered that this gave consumers an unrealistic and exaggerated perception of the level of control they would have over the outcome of a bet and that could lead to irresponsible gambling behaviour”.

In the first place, to remove the semantic objections, the very concept that the consumer could, by using skill (or chance or anything else) have “a level of control over the outcome of a bet” is wrong. Skilful gamblers do not control the outcome of a bet, any more than they control the outcome of the sporting event. What skilful gamblers do is decide which odds to take and which to leave.

What the ASA was probably trying to say is that players reading the advertisement might have an exaggerated perception that the use of skill would enhance their ability to win money from bookmakers with any kind of materiality or regularity.

That is a very different proposition to the one that the ASA set out, but it deserves greater analysis because, despite what we have concluded about the role of skill and chance in predicting sporting events, it seems that the ASA actually stumbled on a fair point. How can that be?

We have already concluded that, for sporting events, if a skilled and knowledgeable gambler is pitted against a mere pin sticker, the former will be more successful than the latter – and consistently so.

However, that is not what Sky Bet is offering. Sports betting against a bookmaker is not simply a question of picking which outcome is most likely, but achieving a profit in a competitive marketplace against a bookmaker which has adjusted the offered odds to reflect not only (i) a very expert view of the overall chances of an event occurring or not occurring; but also (ii) an inbuilt profit margin reflected in the fact that the sum of the total odds offered will be greater than 100% certainty (the so-called “over-round”); and (iii) with the benefit of knowledge of the volumes of bets placed by others in the marketplace on the same event (of which the bookmaker has sight, but the punter does not).

In short, bookmakers adjust the spoils of success by offering shorter prices on good teams to win and shorter prices on bad teams to lose. What the bettor is being asked to do is not in fact to predict winners or losers but, instead, to have a more acute understanding of the difference between the true mathematical odds of an event taking place, when compared with the odds being offered by the bookmaker, (including their profit margin).

That is why there is significant evidence[2] that, the chances of a normal punter being profitable in a competitive betting marketplace against a bookmaker are essentially zero. With the exception of some very highly organised and sophisticated betting syndicates who use complex modelling software to determine value bets in the market or exploit arbitrage, skilful bettors do not fare better than those who choose at random.

That might seem a surprising result – but let’s take a simple example. Imagine a roulette wheel, where picking a single number and picking red or black were both priced at 5:1 return. A foolish gambler might stake money on either type of bet, but anyone sensible would realise that a 5:1 return on a 2:1 chance was a much better value bet than a 5:1 return on a 36:1 shot. Sadly, however, that is not how roulette works. The returns offered by the casino match the mathematical odds, and therefore betting on red or black only yields a 2:1 return. So it makes essentially no difference what type of bet you place. The same is true of sports betting against a bookmaker. The bookmaker has adjusted the odds in such a way that it no longer matters which one is chosen. The only advantage that a player can have through skill and knowledge is if he can identify that a particular bet does not reflect the market reality, and by more than the notional profit margin built in by the bookmaker. Essentially the whole of a bookmaker’s job in making a book is to offer odds at such levels that the customer’s ability to use skill his advantage has been methodically removed.

So what do we learn?

What the ASA appears to have been vaguely grappling with is the paradoxical notions  that knowledge of sporting events should render one more likely to win, seen in the context of our daily experience that there no significant evidence to support such a proposition. In short, whilst the ASA was wrong to disregard knowledge and experience as the most important factor in betting success, it was right to conclude that advertisements for bookmakers which portray consumer expertise as being a factor which can lead to long term profits, are essentially illusory for almost everyone to whom such an advertisement is addressed. Right, but for the wrong reasons.

More worryingly, however, the ASA’s approach demonstrates a widespread but very naïve understanding of the underlying dynamics operating in the gambling world. It is hard to have faith in the decisions of a regulator to determine whether an advertisement “exploits cultural beliefs or traditions about gambling or luck” when it seems all too vulnerable to fallacies about the nature of the forces and factors which determine a result?

Also, one must say something further in defence of any advertisement: an advertiser is allowed a degree of latitude and puffery. Advertisers are allowed to say that their products are “delicious” or “never bettered” or “fantastic value”, and to do so without fear of censure. That is the very nature of advertising in a competitive marketplace. So the ASA’s decision was probably, overall, a harsh one given that Sky Bet was merely trying to encourage customers to think about different types of bet that they might want to combine. Regulators need to be careful that their decisions do not represent an overprotection of the public, or an inherent bias or disapproval against a perfectly legitimate and legal form of adult entertainment.

More broadly, practitioners will see the latest decision in the wider regulatory perspective. ASA decisions were once “fallible but forgivable”, on the basis that they were not legally binding. But from 1 April 2019, they will assume a greater importance. The Gambling Commission has amended its Licence Conditions and Codes of Practice so as to make compliance with the CAP codes a condition for operators.

We have yet to see how the Commission interprets this new rule – and we think it unlikely that a single adverse finding on its own will threaten an operator’s licence – but multiple complaints might have such an effect (after all, if there were no regulatory consequence, there would have been no point in changing the rule). So the hope must be that the ASA will be careful to ensure that its decisions balance the complexity of the issues and the rights of advertisers as well as that of the public. Unfortunately, there is little evidence that it has the expertise to get the decisions right for the right reasons.

If you have gambling advertising issues that you want a second view on, or if you have received an ASA complaint which you wish to contest, or if you just want to discuss your gambling regulatory needs, please feel free to give us a call.

[1] https://www.asa.org.uk/rulings/bonne-terre-ltd-a18-465892.html

[2] A good, and fairly readable example of this can be found at https://www.pinnacle.com/en/betting-articles/educational/professional-bettor-a-question-of-luck-or-skill/FXEJ5Z4WD2KTLGMZ