As a sports betting supplier with the backing of operational excellence over 20 years, it’s reasonable to say we’ve got the knowledge required to maximise hold for our partners. We do things differently at Pinnacle Solution. We don’t get scared off by sharp, supposed ‘non-recreational’ bettors, but instead leverage their knowledge to drive more value in the long term.
Bookmaker restrictions always encourage a heated debate in our industry. Over the past few years, attention has increasingly focused on the refusal by many bookmakers to accept custom from those they deem as unprofitable for their business models. Increasingly, bookmakers are being tarnished in the media and on social channels for this behaviour, which turns customers away and maintains an unlevel playing field.
We see things differently, and we go in a different direction to re-engage disillusioned bettors and optimise hold and boost revenue for our operator partners, using the same, supposed bad bets that many operators turn down.
Why we take them on?
Having cut our teeth in high-volume, low-margin betting environments, taking on custom from professional bettors as part of the course, the Pinnacle trading team has strong faith in its pricing strategy. Sharp customers will pick poor positions off, and so having highly efficient odds and minimal model uncertainty is paramount.
Pinnacle Solution, unlike almost all other risk management providers, manages markets using pure data science, and not by kneejerk reactions based on a couple of supposed sharp bets from a customer in profit. We believe balancing action on a bet-by-bet basis doesn’t work, although each bet does become a part of the wider picture. Instead we look more to samples of bets, or markets as a whole, via the law of large numbers.
We don’t take positions, we don’t lay anything off, we engage all bets, we have skin in the game, and we have confidence in our numbers.
Investing in modelling and betflow analysis
To execute the above, we have to ensure we have the best models. To that end, our investment strategy is hugely focused on data modelling. We want to maximise revenue for our partners, and so we choose to focus on tools that deliver that, which allow sharper business at no cost to long-term profits.
Similarly, our trading team often refer to the sharp bettors across our network as ‘consultants’. These customers are used as an information resource. We incorporate their knowledge and indirectly, their models, into our own via price discovery, leading to more efficient lines across our partners, whether by our iFrame Solution product, or bespoke risk management solution.
Why do operators profile customers?
It’s important to point out that we’re not saying operators shouldn’t be staking their customers how they see fit. Different business models require different approaches. Some brands rely on marketing strategies to attract less-challenging recreational customers, others prefer to drive volume and expect in-built hold to play out as profit in the long run. We can only talk from our experience and then pass that onto brands who want to optimise their existing customer bases.
The reason many operators choose heavy-handed approaches to restricting customers is to mitigate against their marketing outlay and strategy of appealing to recreational customers. Of course, there’s no reason why professional bettors can’t bet with these operators – although they may prefer the higher limits found at brands with greater modelling expertise – and if they choose to do so, they’ll likely start cutting into this heavy investment into acquisition.
At Pinnacle Solution, we won’t get involved in player profiling on the operator side, but what we like to communicate is that our lines are efficient, and if bets from profitable customers are landing on them, then they’re more likely than not on the wrong side of the line and missing the value that could be found elsewhere.
What this all means for partners?
In summary, Pinnacle Solution uses its skin in the game and decades of betting experience to embrace all bettors, sharp, recreational, or somewhere in between. Focusing on getting the price right, irrelevant of the action, is paramount. For our partners, this means we’re not only able to offer the acquisition value of standout pricing, that often goes against homogenous mid-market pricing that many trading teams rely on, but also that we can maximise volume by allowing more betting action.
At no point does this mean that we cut corners or embrace lower hold targets. Instead, we invest heavily to ensure that models are as efficient as possible, giving partners the peace of mind that working with us is the most profitable, and most revenue-driving partnership on the market.