What do people think are the chances of winning money from a wagering requirement? Supplementary results to the main report

In this report, BIT’s Gambling Policy and Research Unit presents additional evidence wagering requirements (WR)—common restrictions on gambling offers stipulating how many times a player must stake their received bonus funds before they can withdraw anything as their own money—are poorly understood by consumers.

Using the same sample as our main report (4,012 UK adults who had gambled in the last 12 months) alongside mathematical and simulation analysis of wagering requirements, we show:

1. For slot games it is impossible for consumers to know the probability of winning money from a WR (or its expected payout), with the exception of the 1x WR. Consumers need more information than a slot game’s return to player, meaning two apparently identical advertised offers may have very different expected payouts with no way to tell the difference. Consumers must therefore rely on their intuitions. 
2. Consumers’ intuitions about WRs were systematically biased. When asked about our in-house slot game, consumers underestimated the probability of winning money from low WRs and overestimated the probability at high WRs. The overestimation may lead consumers to “over-consume” slot game offers relative to a fully informed state.
3. Experience didn’t meaningfully reduce the bias. Neither playing through a WR within the experiment nor having redeemed a WR before our experiment were associated with a consistent improvement in calibration. The exception seems to be the 1x wagering level, the simplest possible WR.

Combining findings from our main report with those from this additional analysis, we suggest that regulators:

• Cap or ban wagering requirements on slot games. Key metrics of slot game wagering requirements are incalculable for consumers, and intuitions appear to be systematically biased in harmful ways at higher wagering requirements. Lowering the wagering requirements permitted will reduce the harm associated with such mistakes by consumers.
• Restrict game contributions to 0% or 100%. If a game has a 50% contribution, every £1 bet contributes £0.50 to meeting the wagering requirement. It is essential to restrict game contributions (ideally to either 0% or 100%) otherwise any cap will be ineffective: for example, for a 1x WR cap an operator may choose a 5% game contribution to all games and the effective wagering requirement becomes 20x.
• Ban framing wagering requirements in terms of the ‘bonus + deposit’. Knowing how much you need to bet to meet a wagering requirement is essential to understanding your chances. Framing wagering requirements in terms of the ‘bonus + deposit’ was shown to cause lower consumer understanding and underestimation of the total amount required to bet in our main results. We provide further evidence consumers don’t adjust to sometimes very large increases in wagering requirements when framed on the ‘bonus + deposit’. As every ‘bonus + deposit’ offer can be easily restated in terms of the ‘bonus only’, the ‘bonus + deposit’ framing has no function except to confuse consumers and we strongly recommend they are banned.
• Test different statistics of wagering requirement value including the total amount you’d need to bet to meet a WR, win rates, and expected payouts to improve consumer understanding. The current information provided is insufficient for consumers to make an informed choice between slot offers, and consumer understanding is very low suggesting more support is required for other casino games as well.
• Make “bonus only” wagering requirements salient at the point of choice. A necessary condition for informed choice is to know a WR applies to an offer, which 3 in 5 did not realise in our main results. Field evidence is recommended to confirm this result, so we’d welcome the opportunity to work with an operator to test this.

Please do get in touch at [email protected] if you would like to discuss anything in this report further.