Betfair s Free Sport Betting Business Model
I've been using Betfair for many years now but it is only recently I've wondered just how much performs this company can even make? This question is what has compelled me to create this information. I will not get copies of the accounts from companies house, this content will likely be all conjecture according to what I've acquired from using your website in the past.
What has allowed me to ponder this question could be the transparency within the Betfair site. If you consider traditional bookies such as WilliamHill, Ladbrokes or Betfred, what you have no idea of on any particular sporting event is what has been bet in whole as well as on what particular outcome these bets were placed.
Take a regular Friday afternoon race meeting at say Ascot. It's the 2.30 and 5 horses are racing; the punters are logging on to one of many traditional bookmakers websites and backing various horses. The outcome is repeat the second favourite winning, we now have no idea whether everyone was backing the outsider or favourite, just how much was bet, and what kind of conserve the bookmaker made.
Now consider the same race with Betfair. The total amount exchanged to the race emerges on top of the page, this really is typically about A�200,000 for a standard horse race. Now we know that Betfair take a commission on all winnings, as well as every bet exchanged there's a winner, so they're taking their 5% no matter the result - about A�10,000 in such cases.
So now for any quick little bit of 'back of fag packet' maths. Approximately 40 races a day generating A�10,000 each are A�400,000 a day seven days weekly, that's 2.8 million pounds a week. Throw inside the bigger meetings and that rounds it to say 3 million, 5% that is A�150,000.
Now look at the Premiership football season. At least 12 games every week generating between A�200,000 along with a million pounds in exchanged bets, consider the average and workout the 5% commission and that's another A�350,000. On top of this you have the lower league and foreign games that must generate another A�100,000 in commission so we're up to Half millions of pounds per week in revenue.
Bear in mind that you could (the ones do) bet on everything, golf, cricket, tennis, boxing, champions league football, International soccer, let alone gaming. I'm beginning to arrive at the conclusion that they must be pulling in weekly revenue inside millions, and sboarena when it's only A�3 million per week, that's over 150 million annually.
I admit to presenting no idea if my workings are drastically wrong here, if Betfair actually has annual revenue of A�1million or A�1billion. Neither do I have a concept of what their legal fees, IT costs etc total. What I do see is the fact that unlike traditional bookmakers the results from a sporting event doesn't have effect on their revenue.
To this end their main aim is always to just recruit as numerous customers as you possibly can, which poses the question; using the numerous online bookies around offering free introductory bets all the way to plus overabundance A�100, then how come Betfair offer only A�30. That is the topic of my next article.