Paysafe Research: Stronger Online Betting Experience Starts With Payments

Rhea-AI Summary

Paysafe (NYSE: PSFE) released a report revealing the essential role of payments in global sportsbooks' customer acquisition and retention. The research surveyed 3,000 sports bettors in several countries, highlighting the importance of rapid payouts and payment choice. The report also emphasized the rising preference for digital wallets and crypto payments among players. The study found that streamlined payouts are the top factor for choosing a sportsbook, with 78% of bettors considering the payment experience important for brand loyalty. The preferences for payment methods are diversifying, with digital wallets challenging debit cards' dominance. The report also indicated a growing interest in alternative payment methods and crypto payments among players.

Market Research Analyst

The findings from Paysafe's research highlight the critical role of payment processing in the online sports betting industry, emphasizing the need for sportsbooks to offer a variety of payment options to attract and retain customers. The preference for rapid payouts and diverse payment methods, including digital wallets and cryptocurrencies, underscores a broader trend towards convenience and flexibility in consumer financial transactions.

From a market research perspective, the data suggests that companies which prioritize payment innovation can potentially gain a competitive edge. As digital wallets are preferred by frequent bettors and VIP players, sportsbooks that integrate these options can tap into a more engaged and lucrative customer segment. Moreover, the growth in alternative payment methods and eCash indicates a market segment that values privacy and traditional payment forms, which could be an untapped opportunity for differentiation.

However, the varying preferences across different regions, such as the high preference for credit cards in France and the established local payment methods in the U.S., indicate the necessity for sportsbooks to tailor their payment offerings to local market dynamics. The research also suggests that brand loyalty can be significantly influenced by the quality of the payment experience, highlighting the importance of investing in secure and efficient payment systems.

Financial Analyst

From a financial standpoint, the report's implications extend to the revenue and growth strategies of online sportsbook operators. Payment processing capabilities are not just a value-added service but a fundamental aspect that affects customer acquisition costs and lifetime value. The emphasis on payment choice and rapid payouts can directly influence the cash flow and profitability of these operators.

The mention of increased confidence in transactional security is a positive signal for the industry's efforts in enhancing trust and reliability, which can, in turn, reduce churn and improve financial outcomes. On the other hand, the interest in cryptocurrency payments, despite market volatility, suggests that sportsbooks willing to adopt this payment form may appeal to a forward-looking customer base, potentially opening new revenue streams.

It's important to note that the regulatory landscape around payment methods, especially concerning cryptocurrencies, will have financial implications for sportsbooks. Regulatory compliance and the ability to adapt to changing payment preferences can significantly impact operational costs and the agility of these businesses in responding to market changes.

Legal Expert

Legally, the evolving payment preferences in the online sports betting industry present both opportunities and challenges. The use of digital wallets and cryptocurrencies has legal implications, particularly with regards to anti-money laundering (AML) regulations and Know Your Customer (KYC) requirements. Sportsbooks must navigate these complexities to ensure compliance while offering the payment diversity that customers demand.

The report's indication of a growing interest in cryptocurrency payments also raises questions about the regulatory frameworks that operators must adhere to. With the legality of cryptocurrency use in gambling varying by jurisdiction, sportsbooks must stay abreast of regional regulatory developments to mitigate legal risks while capitalizing on new payment trends.

Moreover, the ban on credit card use in certain markets, such as the U.K. and Massachusetts, highlights the need for operators to be flexible and proactive in adapting to local regulations. Failure to comply can result in significant legal repercussions, including fines and loss of operating licenses, which would have a direct impact on business viability.

Company research reveals payments play essential role in global sportsbooks’ customer acquisition and retention amid diversifying transactional preferences

LONDON--(BUSINESS WIRE)-- Global online sports-bettors prioritize rapid payouts and payment choice when starting their customer experience with sportsbooks, according to the 2024 All the ways players pay research from Paysafe (NYSE: PSFE), a leading payments platform. Released today, the report also reveals that payments are just as valuable in strengthening the customer experience for players, whose appetite for digital wallets and even crypto payments is rising.

Showcasing Paysafe’s all-new brand identity, which the company recently unveiled, the report surveyed 3,000 sports bettors in six U.S. states (Massachusetts, Michigan, New Jersey, New York, Ohio, Pennsylvania), the Canadian province of Ontario, the U.K., France, Germany, and Italy, in December 2023. The research found that streamlined payouts was players’ top factor when choosing a sportsbook (prioritized by 37%). They consider this more important than brand trust (34%), odds (29%), promotions (26%), user experience (17%), sports markets (15%), and sponsorships (10%).

When selecting a sportsbook, players also prioritize their favorite payment methods’ availability (26%) and seamless deposits (26%) over every factor except brand trust, odds, and promotions.

Payments are just as crucial for strengthening player retention, with 78% of bettors considering the payment experience important in why they remain with a brand. This trends even higher in Italy (88%), New York (84%), and Germany (80%).

Bettors’ payment preferences continue to diversify. Debit cards remain the dominant choice globally (a preference of 38%), though this is being challenged by digital wallets (37%). Wallets are today the top payment preference in Italy (53%) and Germany (52%). And by facilitating wagering across multiple sportsbooks, digital wallets are a leading payment choice of VIP players, with 46% of bettors wagering 5-7 times weekly favoring a digital wallet versus 43% a debit card.

Credit cards’ overall popularity is limited by markets like the U.K. and the U.S. state of Massachusetts banning their use. Despite this, the preference for credit cards remains robust both globally (25%) and across the U.S. (also 25%), while in France they are the favorite payment method of all (47%).

Interest in eCash remains niche but significant, with 13% preferring online cash. This trends higher in countries with an enduring cash culture like Germany (16%) and the U.S. (16%).

Local payment methods (LPMs) available only in single country are a preference of 13%, trending higher in the U.S. (17%) and Canada’s Ontario (17%), with their established LPM brands.

Confidence in the transactional security at sportsbooks continues to improve, with 57% of players more confident than last year. However, there is no room for complacency, with 10% less confident and 33% unsure.

Player adoption of digital wallets, eCash and other alternative payment methods (APMs) will likely grow, with 58% of players expecting to use APMs more through end-2025. And despite cryptocurrency market volatility, crypto payments appear attractive for players, with 50% interested in this when permitted by regulators. This trends higher in the U.S. (58%), especially in New York (72%).

Zak Cutler, President of Global Gaming at Paysafe, commented: “Our latest research clearly indicates the value of payments to online sportsbook operators at all stages of the player experience. Operators that optimize their payment offering will gain a competitive advantage when starting their brand’s relationship with new bettors. Given the correlation between the payment experience and brand loyalty, operators can maximize player retention by getting payments right. This includes upgrading their cashiers to cover all possible payment choices to meet evolving transactional expectations.”

Paysafe is exhibiting at the ICE London conference (Booth N5-220) from February 6^th to 8^th, 2024.

About Paysafe’s 2024 ‘All the ways players pay’ iGaming research

Paysafe’s 2024 ‘All the ways players pay’ report was based on a survey conducted on behalf of Paysafe by Sapio Research among 3,000 consumers who have been involved in, or have a serious interest in, sports betting across six U.S. states (Massachusetts, Michigan, New Jersey, New York, Ohio, Pennsylvania), the Canadian province of Ontario, the U.K., France, Germany, and Italy. The interviews were conducted online by Sapio Research in December 2023 using an email invitation and an online survey.

The full research report can be downloaded here.

About Paysafe

Paysafe Limited (“Paysafe”) (NYSE: PSFE) (PSFE.WS) is a leading payments platform with an extensive track record of serving merchants and consumers in the global entertainment sectors. Its core purpose is to enable businesses and consumers to connect and transact seamlessly through industry-leading capabilities in payment processing, digital wallet, and online cash solutions. With over 20 years of online payment experience, an annualized transactional volume of over $130 billion in 2022, and approximately 3,300 employees located in 12+ countries, Paysafe connects businesses and consumers across 100 payment types in over 40 currencies around the world. Delivered through an integrated platform, Paysafe solutions are geared toward mobile-initiated transactions, real-time analytics and the convergence between brick-and-mortar and online payments. Further information is available at www.paysafe.com.

About Paysafe iGaming

Paysafe brings over two decades of specialized payments experience supporting the global iGaming and sports-betting sectors and provides operators with a comprehensive suite of traditional and alternative payment methods through a single, streamlined API integration. Paysafe is also a leader in digital and affiliate marketing technology and services for iGaming operators through its Income Access business unit.

Since the opening-up of the U.S. iGaming market in May 2018, Paysafe has consistently stated its ambitions to be the payments leader in the fast-growing sector, building on its leadership in Canada and Europe. As of February 5^th, 2024, the company supports 75% of operators in the country with payments or marketing solutions across 32 jurisdictions. In Canada, Paysafe also has a leading position and partners with the majority of regulated iLottery and gaming brands.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240205162279/en/

The Paysafe Press Office via PR@Paysafe.com

Source: Paysafe Limited

FAQ

What is the ticker symbol for Paysafe?

The ticker symbol for Paysafe is PSFE.

What did the Paysafe report reveal about the importance of payments in customer acquisition and retention for sportsbooks?

The report highlighted the essential role of payments in global sportsbooks' customer acquisition and retention, emphasizing the importance of rapid payouts and payment choice.

How many sports bettors were surveyed in the Paysafe report?

The report surveyed 3,000 sports bettors in several countries.

What were the top factors for choosing a sportsbook according to the Paysafe report?

The study found that streamlined payouts were the top factor for choosing a sportsbook, followed by brand trust, odds, and promotions.

What are the rising payment preferences among sports bettors according to the Paysafe report?

The report highlighted the rising preference for digital wallets and even crypto payments among players.

What are the leading payment choices for VIP players according to the Paysafe report?

Digital wallets are the leading payment choice of VIP players, with 46% of bettors wagering 5-7 times weekly favoring a digital wallet versus 43% a debit card.

What is the expected trend for alternative payment methods (APMs) usage according to the Paysafe report?

The report indicated that 58% of players expect to use alternative payment methods more through end-2025.

Where is Paysafe exhibiting from February 6th to 8th, 2024?

Paysafe is exhibiting at the ICE London conference (Booth N5-220) from February 6th to 8th, 2024.