Focus on PayNearMe: PayNearMe executive talks importance of data

October 21, 2022 8:00 AM

Focus on PayNearMe: PayNearMe executive talks importance of data

  • Buck Wargo, CDC Gaming Reports
October 21, 2022 8:00 AM
  • Buck Wargo, CDC Gaming Reports

Payment data matters — and casinos can use that to improve their operations and profit.

Leighton Webb, vice president of igaming and sports betting for PayNearMe, the company designed to manage payment complexities, said all successful businesses are data driven. There’s a lot of information created within an operator’s application relative to consumer behavior, and that data can be used to better player experiences, improve margins, and reduce risk and fraud.

“The ability to not only understand the data is one part of it, but being able to action the data to influence a behavior in the player is beneficial,” Webb said. “They know it’s not enough to just spend on driving customers to the application, but what are you doing to reduce the cost of that customer and maximize the lifetime value for that customer? Data is a large part of that.”

Webb said there’s a convergence taking place in which those in the payments’ space are looking at data for acceptance rate, risk and fraud and how to mitigate against that. But he added that data is equally important to the marketing team in how they can put it into the tools they are using and adjust communications and advertising campaigns to reduce costs and increase lifetime value.

“Not doing those things leads to a poor user experience in a market that we know is extremely competitive, especially as igaming is in the early stages of adoption,” Webb said.

“There’s a lot of noise for the consumer in the market,” he continued. “If the operators are able to access the data in a form and way to be able to action it, they can gain market share against their competitors by having insight into their players.”

Whether it’s a VIP player or first-time player on a betting app, both have different behaviors and what’s important to them. A VIP player will play on multiple sites, make high deposits and want their winnings quickly. Whereas a first-time player may simply need help getting through the process by making it easy, Webb explained.

When a player makes a deposit is important, but what’s equally important is when do they place their second bet, he said. The longer the time period is between that first and second bet, the more the operator is at risk of losing that player.

Operators need to understand that from a marketers’ point-of-view in looking at the data, they can find those segmentations and create marketing campaigns within the app, said Webb.

“Leading e-commerce sites are sophisticated in that it’s one-on-one marketing,” he said. “It’s about how they are getting to understand the player so well that they are able to communicate with them and send them offers based on what the data is showing and what their behaviors are.”

When it comes to player experience, if operators know customers prefer one tender type over another, they can customize that experience to the player. Webb pointed out that a younger demographic, for example, wants electronic payments.

E-commerce sites use technology so advanced that if someone hovers over a product and does not even put it in a shopping cart, they know that, Webb said. They will follow that up immediately with a customized message to encourage the person to go and purchase that product.

“There’s a challenge in terms of rising to the occasion for igaming operators being able to get to that level of sophistication,” he said. “It really does make a difference. This is a low-margin business and every click matters, and every basis point you can improve on that conversion and lifetime value is extremely important and can make the difference in making or breaking the business.”

That’s especially true when there’s so much money going into the player acquisition, Webb said.  “You’re seeing how several operators have announced they are pulling back on ad spend in the marketplace because they realize it’s not sustainable unless you’re able to get a lifetime value that’s greater than that acquisition cost.”

The challenge for gaming operators and any other business is that data sits in different places. There’s payment data, a CRM (customer relationship management) platform with another set of data, and there’s data from an advertisement platform.

“The challenge from a business standpoint is being able to pull all of this together in one place where it makes sense,” Webb said. “At the high level, everyone gets that you need to acquire at the lowest price possible, but it’s always been a question of how do you do that. Our point of view is how do we work across the industry to find ways to make that data available and accessible to operators. Payments data sits at the center of that.”

Data is also extremely important when it comes to risk and fraud, especially for smaller operators and mid-tier operators that don’t have the resources large ones have with a risk and fraud team, Webb said.

“Having a good handle on the data and insights into potential suspicious activity can make the difference in a fraud ring coming in and running up tens of thousands of dollars that is going to be charged back to the operator who has to eat that cost,” he added.

When it comes to responsible gaming, Webb reported that there’s been a lot of discussion on its importance and whether more can be done and how it can be done.

“We as an industry in the U.S. need to get ahead of responsible gaming,” Webb said. “We need to do more than just put up a 1-800 number. Self-exclusion is important, but almost preempting when someone might have a gambling problem is even better. Payments will play a key part in that. When you combine payments data with predictive analytics, you are able to better identify potential problematic behavior before it even happens. That’s a powerful capability for operators.”