A Brief Re-cap from the NCRG and G2E: Part 2

In the second of our re-caps from the NCRG and G2E conferences we provide a summary from the G2E Panel on Proactive Process: Responsible Gaming Online. The session was chaired by Connie Jones, Director of Responsible Gaming at IGT and included Joachim Haeusler, Head of Responsible Gaming at bwin.party, Hillevi Stuhrenberg, Head of Responsible Gaming at Betsson, and Simo Dragicevic of Bet Buddy.

Simo opened up the discussion with an overview of the evolution of responsible gaming tools over the past decade and outlined the factors that are driving the adoption of new responsible gaming tools. Whilst regulation continues to be the major factor driving innovation and adoption in responsible gaming, there are increasingly more examples of how commercial B2C operators are adopting innovative and new advanced tools to help to protect vulnerable players in the absence of regulation. 

For example, Joachim Hauesler, head of responsible gaming at bwin.party, the world's largest listed commercial B2C internet gambling operator, described how bwin.party are using algorithms to detect problematic gambling behaviour to meet regulatory requirements in the Spanish iGaming market, specifically to support decisions as to whether players should be allowed to increase limits. Also Hillevi from Betsson, the Swedish internet gambling B2C and B2B operator, discussed a new online self-help tool that Betsson is piloting with their players which provides proactive online support from their players who feel they are at risk of problem gambling. The support is provided by an independent treatment provider and is voluntary, and any player information given to the treatment provider is confidential and not made available to Betsson. Both of these are great examples of how the commercial sector is seeing the benefits of implementing more personalized responsible gaming tools to help protect vulnerable players, whilst also building their brand equity and customer sustainability. We think it's very encouraging to see some of the recommendations from our industry expert review paper on CSR in gambling written in 2010 now being implemented in the market today.

Connie Jones then opened up the panel discussion with the audience. Much of the interest and questioning was around how B2C operators were using predictive analytics to better understand player behaviors to make personalized interventions. A topic that was discussed in the previous panel surfaced again too - how should operators best share data on self-exclusion? There appeared unanimous agreement on the need for centralized self-exclusion approaches, with Hillevi highlighting the approach to central self-exclusion adopted by the Danish internet gaming market. Simo also challenged the panel further, asking whether at some point in the future operators should collaborate and share not just self-exclusion data but also other player data, such as deposit and timing limits, to offer a unified responsible gaming platform across all operators for players. Whilst it's far to say this suggestion didn't receive overwhelming support from the panel, we feel it's another 'blue sky' thinking idea, that along with the adoption of universal predictive algorithms that was discussed previously, could one day become a standard practice in future regulated gaming markets.

A Brief Re-cap from the NCRG and G2E: Part 1

It has been a while since we last blogged and we are sorry! This is due to the hectic conference season and demand for Bet Buddy products and services, but we are now back on the blogging trail. We wanted to take this opportunity to re-cap on what were excellent NCRG (National Center for Responsible Gaming) and G2E conferences, specifically two of the panel discussions that Bet Buddy participated in. Here's our re-cap on the first of these panels, the NCRG Roundtable on Online Gaming: Regulating Responsible Gaming on the Internet.

The session was chaired by Alan Feldman, Senior Vice President of Public Affairs at MGM Resorts and Chairman of the NCRG, and included Mitch Garber, CEO of Caesars Interactive Entertainment, Mark Lipparelli, Former Chairman of the Nevada Gaming Control Board, Clive Hawkswood, CEO of the Remote Gambling Association, and Simo Dragicevic, CEO of Bet Buddy.

As anticipated there was significant debate about the possible cross-over between social and real money wagering. Some believed that the player wagering characteristics and player types are very different between the two forms of gaming, with very few players making the cross-over from social to real money wagering, whilst others felt that the game mechanics between the two forms of gaming can be very similar. For example, Dr. Jeffrey Derevensky (McGill University) made an excellent point to Mitch Garber, in that given many youngsters play Caesars social games on Facebook such as Slotomania, Caesars has an excellent opportunity to use such games as means to educate younger social gamers about responsible gaming in real money wagering.

Debate also shifted towards the regulatory regime implemented in Nevada ahead of the launch of internet poker. Mitch Garber stressed that the requirements put in place by Mark Lipparelli and his team were more strenuous than his experience in the UK regulated internet gambling market when he was CEO of PartyGaming, specifically around money laundering checks and requirements to verify players' locations. However, when Mark was asked about whether Nevada would be implementing a central self-exclusion database which all licensed operators could use, he said whilst Nevada seriously considered this option, they didn't take this route from day 1 due to the regulator not having sufficient technical ability to develop and host such a service. Whilst we agreed with Mark's assertion that the regulator would require to partner with other specialist providers to deliver such a service, we believe there is sufficient weight of evidence for all regulated markets to adopt such an approach (for more on this topic read Bet Buddy's research into multi-operator self-exclusion with GamCare and Salford University).

There was also debate around what future directions research in problem gambling and Internet gambling should take. Simo Dragicevic stressed that the scientific community and industry should now look to start testing new tools and systems with actual players to assess their effectiveness in influencing behaviours, and whilst Clive Hawkswood supported this approach, he stressed that there are still many differencing view points in the scientific community about what is the best approach to do this, which may be hindering adoption. Alan Feldman asked whether internet gambling companies had developed universal algorithms that could identify people who are at risk for developing problematic gambling behavior. Whilst Mitch Garber stressed that Caesars do place analytics at the heart of their operations and use such approaches, we feel that we are still some way off from being at the point where the industry can adopt universal approaches (although this is not inconceivable).  

In our next blog post, we will highlight the key discussion points from the G2E Panel on Proactive Responsible Gaming, which was chaired by Connie Jones, Director of Responsible Gaming at IGT and included Joachim Haeusler, Head of Responsible Gaming at bwin.party, Hillevi Stuhrenberg, Head of Responsible Gaming at Betsson, and Simo Dragicevic, CEO of Bet Buddy.

2012 NCRG Conference on Gaming Disorders

Bet Buddy co-founder and gaming researcher Simo Dragicevic will be presenting the latest research findings from Bet Buddy's research collaboration with GTECH G2 at the National Center for Responsible Gaming (NCRG) conference at G2E in September/October 2012. For more than a decade, the NCRG Conference on Gambling and Addiction has provided a unique forum where all stakeholders in the field of gambling disorders and responsible gaming come together to discuss the latest research, share best practices and explore real-world applications for new scientific findings. The 2012 conference will include presentations from some of the world's leading academics in the field of gambling addiction and research, including Dr. Marc Potenza (Yale University School of Medicine) and Dr. Robert Ladouceur (Emiritus Prof. of Psychology, Laval Universities), to name but two.


Simo will be presenting findings from Bet Buddy's research programme and will be specifically focusing on self-exclusion theory and also self-exclusion prediction, drawing on the findings from the statistical analysis of actual internet gaming data from casino and poker players from European regulated markets. Simo will also explain how such research is being applied practically in the gaming industry by demonstrating how predictive analytics software solutions work in practice. There is also a panel discussion on Regulating Responsible Gaming on the Internet, where Bet Buddy will be joined by gaming industry leaders Mark Lipparelli (Chairman, Nevada Gaming Control Board), Mitch Garber (CEO Caesars Interactive Entertainment) and Clive Hawkswood (CEO, Remote Gambling Association). More information about the conference can be found at the following link.

Scaling Data to Make Better Decisions

This week we have been attending a series of events held during Big Data Week. At the London Community Event, we heard from a panel discussion on big data that included (amongst others) Hilary Mason, Chief Scientist of Bit.ly, Doug Cutting, co-founder of the Apache Hadoop project, and Nick Halstead, CTO and founder of Datasift. At the same time of Big Data Week, the gaming industry have been attending GiGse 2012 in San Fransisco. During the CEO panel at GiGse, the importance of data was highlighted by Jim Ryan, co-CEO of bwin.party, who said that bwin.party now have around 70 people in their business information team analysing data and feeding back into its marketing operation. This is a big team of data analysts - bwin.party are taking data very seriously. However whilst large organisations have the resources to deploy very large analytics teams to solve big data problems, we believe that as data volumes continue to increase exponentially, adding solely staff to process and mine increasingly large data volumes will not be a scalable solution for any organisation in any industry. This view was confirmed by the expert panel at Big Data Community Event – here is a summary of some of the key discussions themes.

How important is the ‘Big’ in Big Data?

A philosophical explanation of big data centred on being able to look at data with no pre-conceived ideas. As well as an open mind, big data is about having the ability to join multiple data sets and run analytics across them, rather than taking a silo approach. Whilst the panel disagreed on the relative importance of the word ‘big’ in big data, a recurrent message was that today it’s much easier and cheaper to store and analyse very large data sets e.g. large scale data processing (i.e. map reduce) on platforms such as Amazon Web Services (AWS) has now become commoditized, and are now considered established technologies and platforms. And with the profileration of eCommerce, social media and APIs, there is a lot more volume and richness of data available to analyse today. If you are interested in reading an example as to how the combination of cloud computing (e.g. AWS) and Hadoop (map reduce) enables big data processing at scale and at a significantly reduced cost then we suggest you read this article - Big Pain or Big Profits?

What are some of the Challenges?

Arguably the biggest challenge is how do organisations find the important nuggets of information? Taking a 'boil the ocean' approach to big data is fraught with challenges, a theme we have examined in our blog on Data Inflation last month. It was stated that one of the major benefits of big data is the ability to get answers to questions back quickly, which in the past could take weeks and months - but this needs access to an increasingly important resource - the data scientist - a combination of math, computing, and domain expertise, coupled with an open and inquisitive mind. And finding these people is a major headache for most organisations. There was also discussion about academic access and use of data. It was argued commercial organisations still remain very reluctant to share information via open research projects as there is a lack of trust as to how these data sets will be used and by whom (an example of an open research project within the gaming industry is The Transparency Project). A key infrastructure challenge is that the internet has not been designed to process large data sets at low latencies. Ensuring compliance with data privacy requirements, unsurprisingly, remains a major focal point.

Should You Care?

If you want to make better decisions then the answer is yes! The end product of any data or big data project has to be focused on better decision making. In gaming this equates to supporting decision making across aspects of the business: game design, game performance, 1-2-1 marketing and consumer protection, and finance and risk management. So whilst we can argue about the importance of the word 'Big' in big data, we cannot argue about the increasing relevance of data to managing our businesses today. As the panel concluded, "we are just scratching the surface of what is possible".

British Gambling Prevalence Survey - Why the basic math should concern the British Government

The 2011 British Gambling Prevalence Survey (BGPS) reported that problem gambling levels as a percentage of adult population rose from 0.6 - 0.9% between 2007 and 2010. There are two ways to interpret this data. One can contextualise the data by comparing problem gambling prevalance rates in the UK to other countries e.g. UK problem gambling prevalence rates are lower than in other countries, such as Australia and the US, and similar to Germany and Norway. One can also look at the absolute increase and say a 0.3% increase is a very small increase in the grand scheme of things, and also caveat the results by stipulating they were at the 'margins of statistical significance'.

The other way to interpret these results is to think about them in the context of basic arithmetic. In a YouTube video that has had over 4 million hits, Albert Bartlett explains what he believes is the greatest shortcoming of the human race - Our Inability to Understand The Exponential Function. Let's apply some of this basic math to the BGPS results with a high-level analysis of the headline figures.

The UK problem gambling prevalence increase from 2007 - 2010 equates to around 14.5% per year. The prevalence survey also states the rate of problem gambling in the UK population remained constant at 0.6% between 1999 - 2007. If we take the annual increase using this period too, the increase to 2010 was around 3.8% per year. If we assume the UK adult population will grow at 0.58% per year, and if we look to 2018, the best case scenario is that UK problem gambling prevalence rate will have increased over 40% to around 650,000 adults (greater than 1.2% of the total adult population), the worst case scenario is the prevalence rates will have tripled to 2.7% (if the trends in the most recent BGPS continue). If we assume the true growth rate is somewhere in between (e.g. the median of the two rates, around 9%), the projected problem gambling prevalence rate will be at 1.6% of the total adult population by 2018. If we also assume that the UK government will not limit gambling supply and that funding to tackle research and education will remain relatively flat (based on the previous 3 years), whichever way you look at it using basic arithmetic, the UK is on course to have the same levels of problem gambling prevalence as those very same countries that today we point to to make the current UK rates look relatively low.

Curbing [Data] Inflation

We are in the midst of a data deluge according to The Economist. McKinsey are telling us that data volumes are increasing at a rate of 40% per year. Whilst many extol this as a great opportunity, at Bet Buddy we believe this is causing a phenomenon that we have termed Data Inflation i.e. the risk that the value of the data an organisation captures and holds decreases as the supply of data increases.

 

How can this be so? Surely more data means more opportunities to analyse and understand consumer behaviour, therefore more opportunities to drive more personalised and targeted offers and campaigns? In theory this assumption makes sense, however in practice this is very difficult to get right.

The data available to organisations that can be utilised to support marketing, operations and customer services, risk, and compliance activities can be broadly classified as Personal, Machine Generated and Social Network Data (although data privacy laws and policies certainly restrict to what extent we can leverage much of this data). Some data generally falls neatly within these categories, for example we like Splunk’s definitions of machine generated data. However, our categories are open to interpretation e.g. whilst some may categorise click-stream data as machine generated data others argue click-stream records are personal data. Most of the data that is captured within an organisation is, however, never used - 75% remains dormant according to the Financial Times. Whilst this may sound like a lost opportunity, leaving data on the table can also make practical sense.

Knowing how to effectively capture and utilise the right data is the challenge of managing data inflation. Zynga is sending about 5TB of its data to its central store per day, which is about 10% of the data it collects - this covers game actions (personal data) and not log files (machine generated data). We estimate these daily player data volumes are >15x the core player data volumes that a medium sized online gaming operator saves per year (core player data here covers the player, game, session and transaction files). Zynga is clearly a mammoth and generates data on a magnitude alongside the world's largest 'big data' firms. It has over a quarter of a billion monthly active users on Facebook, therefore dwarfing most other gambling and gaming firms. So whilst the infrastructure they have in place is unlikely to be applicable to most gambling firms, they are however a good organisation to examine a little closer. Because of the scale of the data they generate and leverage, they had to invest early in the tools, systems and processes that allow them to better manage the risks of data inflation. As data volumes have continued to increase exponentially, we doubt very much companies such as Zynga relied purely on hiring staff to process and mine increasing data volumes, and they prioritised i.e. they didn't try to analyse everything at the same time. Whilst the magnitude of Zynga's big data challenges do not apply to most gaming and gambling operators, the principles do.

Curbing data inflation requires the organisation to think strategically across a number of key areas e.g. storage, security, transportation, and analytics. We need to step back and start thinking about data within an organisation as an ecosystem of connected data sources, internal and external customers, tools and platforms, processes, and people. Capturing data as part of everyday business-as-usual processes can be very hard, and for data that you prioritise as important for analytics, it means automating daily repetitive tasks and processes, such as:

• Data sourcing – large gaming operators have multiple game offerings and back office account management systems, supporting multiple channels, usually from multiple vendors. This is a bigger challenge than pure data volumes for most gambling firms
• Data cleansing – dealing with date/time stamp conversions, replacing commas in numerical values, treating missing data values, etc
• Data transformation – core player value segmentation calculations, calculating predictor variable data for each predictive model deployed, etc

So organisations need to focus on the data that will drive the most value. Whilst this sounds obvious, we believe that for any single business area or domain, the manager should typically not be presented with more than 15 – 20 data points to manage their business on a daily business. Any more - think of very large and complex dashboards, countless MI reports and tables of data - risks a decrease in productivity and less focus on what really matters to the business i.e. an increase in data inflation. This is important as it informs what data undertakes pre-processing and when, as not every data point needs to be analysed at the same time - some data insights can be utilised after the event whilst others are best applied in real-time. There are other considerations too, such as how and when to undertaken explorative data analysis and how to best visualise data (which is often technical and complex) to enable decisions to be made (here's a good article on visualisation from Jeffrey Heer of Stanford University).

Whilst the value potential of data and analytics is large, the risk of data inflation makes the practicalities of achieving this value very difficult. 

Social Marketing Campaigns

We've been taking a look at the responsible gaming social marketing campaigns that have been launched over the years:

We have pinned 70 examples on to this Pinterest board. The majority of examples originate from Australia, the US and Canada (however we did predominantly use English search terms which has no doubt missed some non-English speaking campaigns). Unsurpisingly there is a heavy emphasis on the potential negative consequences, with a number focusing on impacts on relationships. Whilst many of the older campaigns focus on the words 'problem, gambling and responsible', it's interesting to see how some of the more recent campaigns are framing the messaging without using these words and focusing on different ways to connect the message to a broader audience e.g. images of 'everyday people' enjoying gambling in a responsible manner. Some campaigns are using eye-catching images and videos to visually highlight potential pitfalls whilst others are leveraging other recongnisable social marketing campaigns (e.g. safe sex) in the context of gamblimg. There's also an increasing framing of responsible gaming as something a smart, sensible and thinking-person's gambler would do (see this too). Did we miss any you like? If yes, please post the link in a comment below.

The Product Lifecycle and Responsible Gaming

We are currently collaborating with GamCare and the University of Salford on a project to research multi-operator self-exclusion. The research is examining self-exclusion in a number of contexts, including examining the drivers behind industry adoption of new responsible gaming tools and standards. The research is jointly funded by The UK Technology Strategy Board and the Economic and Social Research Council.

The evolution of technological standards and products follows a specific path according to Wardley (2011).  Wardley, in this video, outlines a model of technology adoption, ideas diffusion and productisation, arguing that activities evolve through a common pathway, starting with innovation, custom development, through to productisation and services and eventually commoditisation. At the commoditisation stage, technology and processes are commonly predictable, repeatable and measurable. Business is ‘warfare’ and a ‘catfight’ argues Wardley, as market forces drive competition, product development, and product adoption through the lifecycle.

As we noted in an earlier blog on industry dynamics, the gambling industry is one where innovation is becoming increasingly critical to success. There is a significant emphasis on creating new and exciting games and content across multiple channels, with new features being  released in increasingly shorter timescales to gain maximum impact and advantage. However, it can be argued that the same emphasis on research and development and innovation has not been seen in the evolution of responsible gaming tools. This is arguably due to the notion that, in general, responsible gaming is viewed a compliance activity by the industry, with operators in effect focusing on delivering the mandatory requirements to ensure they able to compete in regulated markets (although there certainly are exceptions). Having assessed the evolution of responsible gaming features using Wardley's product lifecycle curve, we can see this broad trend emerging.

When examining what drives the productisation of responsible gaming tools one should consider the broader macro industry trends impacting commerce, for example the continuing switch from land-based to internet commerce across all industries. Consumers are, for example, increasingly sure about the security and safety of online payments, which has resulted in a multitude of internet payment service offerings that a gambling operator can leverage which is ultimately driving to the commoditisation of online payments. 

In addition to cross-industry mega trends, regulation has (unsurprisingly) a considerable influence on the evolution of responsible gaming products and services. Responsible gaming features which are now licensing requirements in regulated markets, such as self-exclusion, are firmly ingrained in the product architectures of all internet gaming player account management system product offerings, and are moving to the point of becoming a commoditised offering and responsible gaming 'hygiene factor'. However, some gaming operators have begun to differentiate these hygiene factors, for example by developing self-exclusion by gaming vertical which in effect allow players to self-exclude from specific game types e.g. casino, sports betting, lottery, etc. Such features are currently not widespread and are being developed by operators who see competitive advantage in these offerings. These features will progress from the custom build phase to product/service stage if more operators see this as a source of differentiation. Alternatively, future regulations could demand operators to offer additional responsible gaming tools if they are deemed to provide greater safeguards to the consumer, which would begin elevating these features to 'hygiene factor' status.

Muli-operator self-exclusion solutions, such as VeriPlay, are being developed by software firms such as Bet Buddy in collaboration with industry partners in the absence of regulatory requirements in the UK. If such services are viewed as a compliance activity by the industry, then there is a risk that they will not receive sufficient priority and investment i.e. operators will be unlikley to prioritise the development of a non-mandatory responsible gaming feature ahead of mobile game development, for example. Although we do note there are some excellent responsible gaming initiatives have been developed and led by the industry (see the WLA and ESSA, for example). Nonetheless, this places regulators in a difficult position, in that as regulations remain largely static once defined and implemented, technology innovation continues on a steep upward gradient. Regulations are therefore at risk of becoming quickly out-dated, and if all responsible gaming innovation is left solely in the hands of market forces, there is a risk that neccessary developments in player protection are not prioritised and developed as quickly as they should be given operators' finite resources.

GamCare will be presenting initial research findings in April 2012 at the Responsible Gambling Council's Discovery 2012 Conference in Toronto, Canada.

Recognising running patterns (rather than gambling patterns)

We came across an interesting Research Lab called BioMotionLab, based out of Queens University in Ontario, Canada. They have been doing some really interesting research for a while in a number of areas, including applying statistics and pattern recongnition to the analysis and synthesis of biological motion patterns. The images below are from their configurable point light walker, one of the demos from their website:

The demo uses data from the analysis of the running patterns of 50 men and 50 women, highlighting sex specific differences that can be found in body structure and in the dynamics of movement. You can configure the demo using parameters such as speed, structure and dynamics and you can access the simulator online. Check it out yourself by clicking here, it's fun!