Identifying the most profitable location for betting shops can be challenging and costly.
You have to take account of a huge range of factors and metrics in order to understand the lay of the land, and the elements that motivate your prospective customer base.
However, location intelligence software such as Periscope® has made this process significantly more convenient. You can now calculate multiple elements simultaneously and visualise your findings on your own secure, corporate version of Google Maps.
In this article, we will introduce the primary factors you should consider in order to select a suitable location for betting shops.
How to identify the right location for betting shops
These are the key factors you should consider when choosing how best to position your betting shop branches:
1) Customer demographics
Betting shops tend to rely on a limited pool of core customers who visit regularly.
According to a recent report prepared for the Competition & Markets Authority, approximately 75% of customers visit the same betting shop at least once per week. Meanwhile, 90% of customers will visit either the same or a different betting shop during the course of a week.
Finding out who these customers are, where they live/work/shop and what defines their demographic type are all crucial for positioning your betting shops effectively.
However, you should also aim to analyse the traits of infrequent visitors and find out what may motivate them to attend more regularly. These customers comprise a huge, untapped market for betting shop companies.
Convenience is by far the most important aspect for drawing in betting shop customers.
65% of Ladbrokes customers cited convenience as their main decision-making factor, compared to just 7% who selected ‘Service’ and 1% who chose ‘Environment’.
More specifically, the majority of betting shop customers typically look for betting shops close to their place of work, or their home.
61% of Ladbrokes customers state visiting a betting shop was not their main reason for making a trip. Therefore, central locations close to workplaces and shopping quarters are likely to generate more profits than those in largely residential areas.
The removal of the Gambling Act’s ‘demand test’ for new shop licence applications has made it significantly easier for betting shops to set up locations in central areas.
3) Proximity to other amenities
Linked to the idea that visiting a betting shop is typically not a customer’s main motivation for making a trip is the need to stay close to other, related amenities.
This was especially evident among Ladbrokes customers, who cited ease-of-access and availability of other shops among the factors that were most important in their decision-making process.
Aim to identify locations that have the following amenities within easy walking distance:
- Public transport hub (e.g. bus stop or train station) and parking facilities
- Food vendors: The most loyal betting shop patrons are likely to stay for long enough that refreshment is required, but may not want to purchase food or drink on-site
- Pubs or bars: Positioning betting shops close to pubs that screen regular/one-off national and international sports events is likely to drive up revenue generation potential (86% of Ladbrokes customers visit betting shops purely to place bets, mainly on sports events)
Select the right location for betting shops by using location intelligence software to calculate all these metrics and more.
Optimise the placement of your betting shops and enhance profitability with Periscope® from Newgrove; sign up for a free, 10-minute demo today.