UK LEGAL COMMENT


proposed opt-in requirement by product and channel


A new requirement will mean a significant change for most gambling operators, reducing the opportunity for cross-selling new products to existing customers. Northridge Law’s Melanie Ellis explains.


O 34 SEPTEMBER 2023


ne of the Gambling Commission’s consultation topics arising from the White Paper relates to direct marketing, with the stated aim of improving consumer choice. Broadly, the proposals are that gambling operators must obtain an ‘opt-in’ by customers to


receive direct marketing, broken down by both channel and product type. This will impact the opportunity for cross-selling new products to existing customers, likely in a significant way. In particular, bonus offers for slots games will only be able to be sent to sports betting customers who have taken positive action to opt-in to casino marketing. The proposals will apply equally to land-based and remote operators.


What is covered by ‘direct marketing’? The Data Protection Act defines direct marketing as “the communication (by whatever means) of advertising or marketing material which is directed to particular individuals” and this definition has been adopted by the Gambling Commission in its consultation document. The Information Commissioner’s Office (‘ICO’) considers that direct marketing takes place whenever a business seeks to promote is products or services and directs this to particular people. Not all direct customer communications count as direct marketing,


however. In particular, service messages fall outside the definition, as would responsible gambling interactions. The boundary between marketing communications and other types of message can be difficult to determine, for example in 2021 AMEX was fined by the ICO for incorrectly classifying emails about downloading their app and receiving rewards for referring friends as service messages. Guidance issued by the ICO indicates that the “phrasing, tone and context” of a message is key to determining whether it is direct marketing.


Direct marketing reform –


What are the current rules? Currently, direct marketing by gambling operators is governed by data protection legislation. A lawful basis, such as consent, is already needed for direct marketing, as it involves using people’s data to send them the communication. However, an exception under the Privacy and Electronic Communications Regulations (‘PECR’) means a ‘soft opt-in’ can be relied on when a company is sending marketing to existing customers about similar products and services. This means that, provided the customer is given the opportunity to opt-out when signing up as a customer and in every marketing communication, a gambling operator can currently send their existing customers direct marketing for other similar products they offer, without explicit consent. The Gambling Commission has imposed some additional


restrictions on direct marketing through its LCCP. Self-excluded customers cannot be sent direct marketing and must be removed from marketing databases, with an explicit opt-in required to receive marketing after the end of their self-exclusion period. Since new customer interaction rules came into force in September 2022, remote operators must also reduce or prevent marketing as appropriate, based on the indicators of harm displayed by the customer, with a requirement not to market bonus offers to customers displaying strong indicators of harm. Guidance on the new customer interaction rules remains subject to consultation, but the draft guidance states that in these circumstances direct marketing should be prevented across all product types and across the operator’s Group.


What did the White Paper propose? In its White Paper, the Government noted that “many responses from those with personal experience reported how harm can be intensified by ad targeting and direct marketing”. It also cited evidence from the Gambling Commission that, of those who had spent money in response to seeing gambling advertising, “direct marketing was the most likely to prompt individuals to increase the amount of money that they spend gambling, or restart gambling after taking a break.” The Commission’s research also found that 41% of moderate risk and problem gamblers were influenced to gamble more by direct marketing. The White Paper states that cross-selling was raised as a particular


concern in some responses to its call for evidence and notes that Public Health England’s evidence review found an association between participating in seven or more gambling activities and harmful gambling,


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80