The End Of Gambling Sponsorships In English Football
The End Of Gambling Sponsorships In English Football
Recently the English Premier League announced during December 2020 that, after reviewing previous gambling laws such as the 2005 Gambling Act, they are to follow in the footsteps of Europe, namely Italy and Spain, by banning all forms of gambling sponsorships at the start of 2019.
Although this ban was announced to curb the prevalence of problem gambling and level the playing field for smaller clubs with a lower budget, this has left many clubs in a tough situation as gambling sponsorships make up a significant portion of their funding across the length of a season.
What are the repercussions of the sponsorship ban that is set to take place in 2023? We will explore them in greater detail below.
“The advertising works—100%.” – Paul Pettigrew, ex-Morton football club player and founder of Gamtalk.
Paul Pettigrew, a former Morton player, would know best the dire effects of gambling. Pettigrew lost a total of £32,000 by the age of 32. After hanging up his boots, the ex-Morton player now goes around schools spreading the word about the dangers of problem gambling.
One particular experience he has is when he asked a class of 15-year-olds about how many betting firms they knew of, to which the students replied with 13 different names.
As a result, the UK government is considering whether to completely ban gambling sponsorship in English football as part of the review of the Gambling Act that was launched by the Department of Digital, Culture, Media and Sport (DCMS) in December 2020.
Meaning that, should the ban become effective, many Premier League clubs could lose their lucrative sponsorship deals—currently held by nine clubs in the Premier League and 15 in the Championship—in 2023.
However, the motivations behind the sponsorship ban could be an attempt from the British government to seal off existing loopholes that have allowed many betting brands without a UK licence to partner with ‘white label’ companies that are often based in territories such as the Isle of Man or Malta, which provides them access to the British market with much less of the hassle.
According to the Daily Mail, successful implementation of the sponsorship ban could mean that the top flight and the second-tier Championship will lose out on a combined total of £100 million in betting sponsorship deals.
This has left the UK government between a rock and a hard place whether to ban gambling sponsorship in football as part of its review of the Gambling Act, given that a significant number of football clubs—up to 72 of them—are heavily reliant on gambling sponsorships for funding, the ban on sponsorships could very well cause the clubs to go under.
Rick Parry, Chairman of the English Football League, commissioned a study that suggests there is no evidence on the correlations between gambling advertising and the increase in problem gambling.
The numbers suggest otherwise however, with a staggering 245,000 problem gamblers being identified in a 2018 study by NHS Digital. On the flip side, you will see campaigners who are actively campaigning for the end of gambling sponsorships in football on the premise that they are everywhere, targeting susceptible groups such as problem gamblers while normalising the practice for children.
Campaigners, who want an end to betting sponsorship in football, have questioned that claim and say adverts are ubiquitous, target vulnerable gamblers and normalise the practice for children.
The question at hand is whether gambling advertising is damaging to clubs and whether it is possible to find a middle ground.
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Parry said at one time that a gambling sponsorship ban would immediately result in the loss of English Football League sponsor, Skybet (Sky Betting & Gaming), resulting in up to £40 million a year in lost revenue. He has also mentioned that the English Football League has yet to make a full recovery from the ‘£250 million’ hole in the pocket in the clubs’ finances due to the lack of gate receipts alone.
While gambling sponsorship is worth plenty in the top flight, for teams in the lower divisions or lower reaches in the Premier League, the difference that adds up is too big to ignore especially when it comes to shirt sponsorship. This is because they receive significantly more money offered by gambling firms than alternative brands.
Some club directors—this one, in particular, being a director of a Championship club—have spoken about how lucrative these sponsorship deals are, with some deals amounting to £5 or £6 million a season. Where West Ham’s deal with Betway is netting them a nifty £10 million a season; the most lucrative gambling sponsorship in the top flight. But all this funding comes at a cost.
While some are desperate to move away from having a betting sponsor on their shirt because it conflicts with their club’s values, the difference in income is just too big to simply walk away. A sponsorship deal from gambling firms is what allows these teams to fund the purchase of an extra player, for example, and justifying any other alternatives will be a tall order especially in a period where there have not been crowds for more than a year.
Not only that, if smaller clubs take less than what these multi-million dollar contracts are offering over a course of the season, not only will the differences add up significantly, but the loss of funds could also result in a club going under. To compound the difficulties, finding a sponsor during this challenging period is also not easy.
And shirt sponsorship is only the tip of the iceberg.
There are eight clubs with betting firms on their shirts but 17 others have betting partners who advertise around the pitch, on training kits, and even on social media. Whereas in the championship division, there are 10 firms out of the total 24 with shirt sponsorships, but if betting partners are included then that number also increases dramatically. This is exactly why the English Football League believes it has a strong case and is lobbying the government to try and prevent a blanket ban from happening.
The English Football League commissioned what it claims as an independent study by Professor Iain McHale at the University of Liverpool as part of its submission to the Gambling Act review.
And the results of that study determined that gambling participation in sport had remained flat at about 9 per cent of the population between 2010 and 2018, where over the same period, the percentage of problem gambling in sports had been halved from 6 per cent to 3 per cent. While this is by no means a reason for celebration, it is evident that the rate of problem gambling has reduced significantly.
The Big Step, a campaign group lobbying for a blanket ban on gambling sponsorships, argues that the study should not be classed as independent given that the English Football League has vested interest, and that problem gambling figures are often inaccurate.
However, the Gambling Commission that regulates the industry showed its latest figures that acutely showed a drop in problem gambling in England, with considerations to the fact that the data could be skewed due to COVID related reasons.
The English Football League Chairman argued that instead of implementing an outright ban on gambling advertising, more focus should be given towards the nuances instead; such as the volume of advertising, whether there are any issues of the use of social media, getting sportsmen to endorse betting, etc. He argues that these issues are the crux of the problem and that involving the English Football League can lead to the resolution of those problems and any other problems that may arise in the future.
One of the biggest criticisms of gambling advertising is that gambling advertising targets young children, making them susceptible to problem gambling as they grow older. Former footballer, Paul Pettigrew, who is also the founder of the charity organisation Gamtalk also agrees that the volume of adverts should be reduced. Quoting Pettigrew, he remarked that “Football is the national sport and the adverts have been subconsciously ingrained into kids from a young age, they are bright and colourful and catch your eye”.
Especially in the digital age where the internet and mobile phones have made it extremely easy for kids to gamble, with studies suggesting that they do. In 2018, research done by the UK public body the Gambling Commission found that 450,000 children aged 11 to 16 gamble and, shockingly, that 55,000 are already addicted.
“Clubs are already not allowed gambling sponsors on kids’ shirts, which almost admits there is something wrong.” – Paul Pettigrew.
There has also been some tacit acknowledgement of the gravity of the issue, in the form of the ban that prohibits gambling form from advertising on kids’ shirts.
It is hard to argue that children are not exposed to gambling brands through football. As demonstrated with campaign groups such as Clean Up Gambling, who believe that gambling advertising in football should always be a part of any debate where these types of findings are concerned.
The organisation ran a campaign that made an explicit connection with children and problem gambling. An analysis found that 40 per cent of children’s collectables featured gambling logos, yet there is still some disagreement over the link between exposure to the branding and the gambling itself; there are others who believe in the evidence while there are those who do not.
Pettigrew also argues that while this proposed blanket ban should not cause any club to close its doors, he suggests that football clubs in the United Kingdom can seek out alternative sponsors if they look at the right places. However, can the English football industry wean itself off the sumptuous amounts from gambling sponsorships?
“Football can wean itself off gambling revenue.” – Mark Pallos, Chairman of Trammere Rovers.
The chairman of the League Two club is one among many clubs in English football—including Chelsea, Liverpool, Sheffield United, Luton and Forest Green Rovers—to not have betting sponsors.
He told a parliamentary group that discussed football’s relationship with betting in March that although shirt sponsorship income is a part of any football club’s bottom line, it is not highly significant in the sense where it makes up only 10 to 15 per cent of a total budget of, for example, £1.5 million. I.e. they can find other sponsors to replace what they already have.
He also suggested that a portion of the problem stems from the fact that there was an unhealthy “thirst to spend money”, citing the fact that player wages are out of control.
The consensus is that the Gambling Act of 2005 liberalised online sports betting, and although gambling sponsorship makes up a big part of the football industry in the United Kingdom, that there is no over-reliance on gambling sponsorship money, believing that they have a solid case to lobby against the blanket ban.
While the football industry has become a multi-million dollar landscape, where gambling advertising has become an everyday part of the football scene, the concerns about the potential harm that gambling advertising may cause is heavily conflicted by the fact that many smaller clubs—whether at the lower table of the Premier League or the lower divisions—are still mostly reliant on the funding from gambling advertising; giving them the financial flexibility to make crucial decisions for the club whether it be for growth or survival.