iGaming News #019 | The end of the "Welcome Bonus": lessons from retail
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The traditional welcome bonuses offered by betting operators will no longer be an option in attracting bettors in Brazil.
This change follows recent updates to regulations by the Department of Prizes and Betting of the Ministry of Finance, reflecting a critical focus for the regulated market in Brazil: responsible gambling.
According to Article 42, Paragraph 1 of Ordinance SPA No. 1231/2024:
"§ 1 The betting operator may establish rules for the use of rewards as mentioned in the caput, provided these are clearly stated in the Terms and Conditions of the betting system. However, it is prohibited to:
I - Condition the provision of bonuses, rewards, or items upon financial contributions made by bettors; and
II - Offer, in any form, advances, prepayments, bonuses, or prior advantages, even as part of a promotion, advertisement, or marketing, to incentivize betting."
In essence, operators: Can no longer offer bonuses or rewards conditioned on deposits. In other words, operators cannot require bettors to deposit money in order to receive rewards. Cannot provide advance bonuses or incentives to encourage betting. For example, it is prohibited to offer bonuses upfront to attract bettors, even if it is part of a promotion.
While withdrawal requirements for bonuses may exist, these conditions cannot mandate additional deposits for withdrawal to be possible.
Given this context, the competition for bettor attention and loyalty gains a positive complexity that only a regulated market can foster. This seemingly challenging prohibition is an invitation for operators to rethink growth strategies, which will require a substantial dose of responsibility and a bit of benchmarking from other competitive markets.
Major brands in other markets also face fierce competition and employ a variety of approaches to build customer loyalty. Here are a few examples:
1. Exclusive and informative content: Sephora Beauty Insider
Sephora keeps customers informed and engaged through beauty tutorials, exclusive workshops, and personalized product tips. This type of content builds trust by demonstrating expertise and creating a bond with the brand. By providing useful information consistently, the company keeps customers interested and increases the likelihood of recommendations, strengthening long-term brand loyalty.
Betting companies could offer guides and tutorials on:
Exclusive sports news and analysis can also attract bettors interested in up-to-date, accurate information, differentiating the company from competitors. Such content not only enhances the user experience but also keeps them engaged.
2. Loyalty programs: Amazon
Amazon Prime is an excellent example of how a loyalty program can work. The company offers a wide range of exclusive benefits, including free shipping on thousands of products, fast delivery (sometimes on the same day), and access to streaming video, music, e-books, and games. It also offers access to exclusive events like Prime Day, featuring limited-time discounts and promotions exclusive to subscribers.
Ideas for the betting market might include:
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These incentives not only keep customers engaged but also generate positive word-of-mouth and long-term loyalty.
3. Personalized experiences: Starbucks Rewards
The Starbucks Rewards program uses customer data to offer personalized rewards, such as free drinks on birthdays and discounts on favorite products, increasing loyalty and visit frequency.
For betting operators, it’s crucial to remain compliant with Article 42 of Ordinance SPA/MF No. 1231/2024, but here are some general ways to deliver a personalized experience:
4. Limited-Time discounts and offers: Black Friday in retail
Black Friday is a classic example of how limited-time discounts and offers can drive significant sales volume quickly. Retailers like Walmart and Best Buy attract millions of customers with aggressive promotions.
For betting companies, some ideas might include:
Operators should note that regarding offers and discounts, they must adhere to Article 43 of Ordinance SPA/MF No. 1231/2024, which requires that points awarded by betting operators be maintained separately from the monetary account balance held by the bettor with the operator.
Conclusion
As in many other digital sectors, the user experience has become one of the main decision factors for customer retention and loyalty. Whether through transparency in betting, the ease of prize withdrawal, or personalized customer support, clarity and consistency can, over time, be more decisive for customer loyalty than Welcome Bonuses.
And although nothing is more impactful than the continuous building of a strong, responsible brand, there are many marketing avenues worth exploring. From detailed match analyses and cashbacks to exclusive experiences for loyal users, any actions taken responsibly by operators and aligned with responsible gambling practices are viable alternatives to help operators establish themselves in the Brazilian market.
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