Casino de Espinho vs Bwin

How do you gamble?

Cláudia Alexandra da Silva Pereira
Executive MBA 2008/09 Filipe José Martins Almeida
Group 8 João Paulo Lopes Gonçalves
José Pedro Monteiro de Almeida Ferreira
Sandie Dantas da Costa
Vasco Alexandre Cerqueira Mendes Campos

Group 8 1
Gambling: The sure way of
getting nothing from
something…

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Introduction

• The aim of this project is to compare the strategy

of two gambling companies who operate through
different channels and understand how this
difference impact their operations.
• For that purpose we choose a traditional casino
(Casino de Espinho) and an web gambling area
(Bwin).
• Gambling is part of the human being, a way to,
through entertainment, forget about real life and
seize the moment.
• The game mechanisms and forms have been
developing throughout the times.
• Currently the game is a regulated activity,
physically (and legally) available in casinos or
through Internet.

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Portuguese gambling market

• The Portuguese traditional gambling market (born Chaves

officially in 1927) includes mainly lottery, casinos and
Póvoa Varzim
bingos
• Currently there are ten licensed casinos in Portugal Espinho

• Troia casino (south of Lisbon) is expected to open in

2009
Figueira
• Traditional casinos have local monopolies in the da Foz
specified license areas
• In 2006 this market amounted to € 355 million
• Casino activity includes:
– gambling (table games) => 15% of casino’s
revenues
– slot machines => 84% of casino’s revenues Estoril Lisboa

– bingos (integrated in the casino only in

Espinho) => 1% of casino’s revenues

Praia da
Rocha Montegordo

Vilamoura

Figure 1: Portuguese casinos’ location

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Online gambling market

• Started in 1996
• Global market (no borders)
• Estimated $16.5 billion gross revenues (2008)
• Yearly growth of 3.3% in 2007 and estimated
average growth rate of 10% per year till 2012
• Online gaming market (2007):
– Sports betting – 38.8%
– Casino and games – 25.6%
– Poker – 23.6%
– Other (including lottery & bingo) – 12%
• Main regions (2007)
– Europe – 44.6%
– America – 35.1%
– Asia – 10.4%
• US prohibited online gambling in 2006
• Strong growth of online casino in Europe (34%
growth in 2007)

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Casino de Espinho (Solverde)

• Luxury installations 20km south of Oporto

• Incorporated in 1928, renewed in 1982
• Mixed game room (including slot machines and
traditional games) introduced in 2004
• € 54 million of gaming revenues
• € 2 million of other revenues (shows, restaurant, hotel)
• Equipments:
– 1 040 slot machines
– 11 card table games
– 12 traditional roulettes
– 13 virtual roulettes
– 4 “banca francesa” tables
– 4 Poker Texas Hold’Em
– Bingo (280 places)
• Tournaments (Poker Hold’Em, Poker, bridge)
• Related services: shows, restaurant, hotel, bar, events,
cinema, prizes (car lottery)
• Sponsorships: Golf and rally
• 485 employees

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Bwin

• Bwin internet platform available 24/7 (no physical

location)
• Gibraltar license for sports betting and casino,
worldwide operations
• High business risk:
– US and Turkey have forbidden online gambling
– EU legislation under discussion
• Gambling services: poker, casino, games and sports
betting covering:
– 90 sports
– 500 soccer leagues in 100 countries
– Multiple offers of live betting
• € 350 million revenues (2007)
• € 50 million of reported profit (2007)
• 21.4% year-on-year increased revenues
• 1.6 million active customers
• 231 million bets placed in the period
• Sponsorships: AC Milan, Real Madrid
• Over 1100 employees around the world (400 belong
to IT department)

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Corporate strategy & marketing strategy
Casino de Espinho Bwin
Corporate strategy
• Casino perceived as a place for entertainment on any
occasion (holidays, shows)
• To be the best casino in the North of Portugal
• Transform online games into traditional casino games
Marketing strategy
• Provide an exclusive environment and experience (bring
the glamour back to gaming)
• Competition amongst players (tournaments, live gaming)
• Shows (periodically renewed) and concerts (selected
artists)
• Loyalty card (points to be exchanged by services)
• Sponsor exclusive sports (golf and rally)
• Renew periodically machines
Corporate strategy
• To remain as the world’s leading online entertainment
provider
• To provide the most extensive, complete and innovative
gaming portfolios via the internet and mobile device
• To achieve an high profile amongst key target audiences in
high-potential markets
• To develop international standards with respect to
technology and products, as well as legal and social issues
• Corporate Social Responsibility
Marketing strategy
• Brand awareness (sponsor famous teams: Real Madrid, AC
Milan)
• Leading-edge technology: development of products of an
unrivalled technical standard and content
• b’inside loyalty program (points to exchanged by gadgets
and stuff)
• Constant upgrades and the integration of third-party casino
• Broad offer of games and bets
(€ 99 million of marketing expenses in 2007)
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Order winners and order qualifiers

Casino de Espinho Bwin

Order winners Order winners

• Live competition with other players • Accessibility and convenience (24/7, wherever in the
world)
• Glamour, atmosphere
• Portfolio of gaming bets (sporting bets, poker, casino,
• Personal contact other games)

Order qualifier Order qualifier

• Dependability (trust on gambling odds) • Dependability (trust on gambling odds)

• Periodical renewal of games • Periodical renewal of games

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Operations strategy – Gamble @ Casino

Get winnings
Go to casino
back!

Game Thrill on
selection suspense

Get money Place your

(chips) bet

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Operations strategy – Gamble @ Bwin

Online
Simulation or Place your
Account
Play for real bet
Open

Money Play online Thrill on

Transfer or offline suspense

Money
Game Get winnings
Exchange to
selection back (or not)!
chips

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Process Casino de Espinho

Gaming Floor 5

Main Entrance

Bar Restaurants – Floor -1 and 5

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Process Bwin – Online casino

Group 8 13
Infrastructure- Casino Espinho

Different
Live client
gaming areas
Support relationship
Luxury (slot Promotion Social
services management
installations machines, (shows, responsibility
(restaurant, (special offers
(glamorous Mixed games tournaments, (gaming
bar, cinema, for regular
atmosphere) area, exclusive events) restriction)
hotel) clients and VIP
area, VIP
treatment)
area)

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Infrastructure - Bwin

Content IT Corporate
Payments & Customer
Product Sponsoring Managemen Infrastructur Social
Withdrawals Support &
Developmen and t e Responsibilit
Distribution (Credit Loyalty
t Advertising Managemen y
(Internet, (Feed t Cards, e- (Online user
(New sports, (Soccer, website, live (gaming
Mobiles) money, pre- support,
Games, Moto GP, betting) (Servers addiction
paid cards b’inside
Casino) Basketball) Maintenance and other
or cash) program)
, IT support) projects)

Group 8 15
Terry Hill model – Casino Espinho

Infra-
Corporate Marketing Order Order Processes
structures
objectives strategy qualifiers winners selection
selection

Exclusive
Casino perceived environment and Manager by
as a place for experience Live competition gaming area
Moderate capacity
entertainment on Dependability with other players
any ocasion Competition (trust on gambling
amongst players odds)
Security and
Shows and trustable games
To be the best concerts Physical location :
Glamour, near a big city
casino in the North
atmosphere
of Portugal Luxury place
Loyalty card
Support areas
logistics
Sponsor exclusive Periodical renewal
Transform online sports of games
games into Moderate variety
Personal contact Specialized
traditional casino of games
games Renew periodically personnel
machines

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16
Terry Hill model – Bwin

Infra-
Corporate Marketing Order Order Processes
structures
strategy strategy qualifiers winners selection
selection

Brand awareness
World’s leading
(sponsor famous
online entertainment
teams: Real Madrid,
provider IT development &
AC Milan) High capacity
Accessibility and support
Dependability (trust convenience (24/7,
Most extensive, Leading-edge on gambling odds) wherever in the
gaming portfolios via technology world)
internet and mobile development

High profile amongst

Constant upgrades Content
key target audiences
and the integration of High product variety management (inc.
in high-potential
third-party casino live betting)
markets

Develop international
standards Broad offer of games
Portfolio of gaming
(technology and and bets
Periodical renewal of bets (sporting bets,
products)
games poker, casino, other
games) User support
Virtual location
Corporate Social
Loyalty card
Responsibility

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17
Conclusions

• Both companies seem to have their corporate and marketing strategy, their
infrastructure and processes aligned with their order winners
• Casino de Espinho benefit from the fact that the market is regulated however the
Portuguese gambling market has been decreasing in the recent years, so they
have to reinvent themselves
• While in Casino of Espinho all is about glamour, personal contact and live
competition, Bwin is just about gambling, wherever at what ever time, even in an
cold environment
• From 2006 to 2007 Bwin net results decreased due to the online gambling being
forbidden in the US and Turkey. However, considering only the European market,
which represent 44% of the online gambling market, Bwin revenues are growing.
• Currently Bwin has an open litigation with the Portuguese State, due to a conflict
related with the advertisement for the Portuguese football League, which is
leading discussions on gambling regulations.
• We should note that EU is still discussing regulations on online gambling and
thus, one can only bet on what the outcome will be…

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18
Conclusions

Any questions?
(tips on gambling winning strategies excluded…)

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