Gambling Addiction and Online Casino Advertising: the Moral Aspect

Gambling advertising has long been a controversial prospect. Unlike other industries today, the legalized gambling industry is heavily regulated by state authorities that seek to balance the positive economic effects of gambling with the negative social and economic costs it imposes on individuals, families, communities, and the public healthcare system.

While most industries use advertising to draw in new customers to their brand, gambling ads in many markets are barred from trying to recruit new customers with bonus offers or free spins, instead, gambling ads are often geared toward existing customers. Most regulatory bodies across the globe are aware that there is a huge demand for online gambling services. In countries where online gambling is illegal, players turn to the black market.

Many countries are now more open to legalizing online gambling as they don’t want to lose out on state gaming taxes and also want their players to be protected properly, which is hard to do when online gambling is illegal.

Why Are Online Gambling Ads Targeted?

However, because excessive gambling can lead to social ills, the gaming regulator must ensure that the current pool of gamblers do not get manipulated by iGaming operators as an iGaming market with weak regulations can easily cause a massive spike in gambling addiction. One of the main ways to police iGaming operators is to impose stringent restrictions on gaming advertisements.

This is why gambling ads are often limited to what they can mention, where they can be placed, and what time they can be broadcasted. Gambling operators have bristled at this prospect, as it limits their potential earnings to just existing gamblers. While most have tried to stay above board of the regulations, many are pushing their edges by trying to find loopholes to mixed effect.

Regulators often argue that gambling advertisements geared toward vulnerable populations, such as minors or those desperate for money, are harmful because they encourage unhealthy gambling behaviors. Once these customers become addicts, they become a burden to society, costing countries millions of dollars a year in interventions and treatments.

A number of countries have been trying to get their online casino industries to comply with the ad restrictions. Some of the countries that have recently cracked the whip on gambling ads include England, Italy, Spain, Australia, Denmark and Sweden.

Sweden Gives Regulator Free Rein to Police Gambling Ads

Sweden has ramped up its approach to regulating gambling ads, and is now at Stage 2 of their new approach. Sweden’s regulatory board, the Spelinspektionen, has now been given more leeway to examine gambling ads and decide whether stricter measures are needed.

Currently, the Spelinspektionen is empowered to enact swift actions if and when they deem a gambling firm has overstepped in their advertising campaigns targeting keywords like ‘casino utan spellicens’ or ‘casino utan Spelpaus’, (example of MGA- and Curacao licensed casinos advertised in Sweden) – although industry observers fear that the lack of clarity regarding the meaning of “aggressive advertising campaigns” may lead to regulatory actions that could harm the industry.

UKGC Struggling To Reduce Problem Gambling

The UK for many years had a reputation of being one of the most liberal online gambling markets in the world. The freedom boosted the iGaming market as operators went all out to capture market share and grow their player database. The UK Gambling Commission (UKGC) gave operators a free hand as they were happy with the revenues being generated to the state coffers.

However, the UK suddenly had to combat a massive spike in gambling addiction in both adults and minors. During the last few years, the UKGC and the government have worked closely together to put in place a number of measures to reduce problem gambling.

Some of these measures include reducing the minimum stakes of FOBTs, imposing heavy fines on iGaming operators who deliberately target children through their advertisements, pushing online gambling operators to be more socially responsible and ask the Advertising Standards Authority to send out strict warnings of its new regulations concerning gambling ads.

Italy Bans All Gambling Ads

In Italy, all gambling advertisements have been banned since August 2018. Under Italy’s Dignity Degree, all advertising related to games with real cash prizes are banned, including indirect advertising through cultural events, billboards, or social media.

All types of communication to the public using promotional content is also banned, including displaying names of gambling firms on events, starting January 1, 2019. Furthermore, Italy decreed that any advertisement must refer to issues arising from gambling as “disorders from gambling” as a means of dissuading viewers from gambling.

Spain Seeks Massive Reduction of Gambling Ads

Spanish authorities, led by Alberto Garzon, the state’s consumer protection minister is looking to institute a massive reduction on all gambling ads as a means of protecting problem gamblers and other susceptible populations. Their aim is to decrease television gambling ads by as much as 80%, and bar celebrities from endorsing all gambling-related products and services.

While children’s football uniforms will be banned from containing gambling firm logos, Spain is not expected to bar professional teams from gambling sponsors.

The introduction of online casinos have helped Spain’s gambling industry surge in recent years, with online betting nearly tripling from 2014 to 2018 – currently, their market is valued at $19.2 billion. Spanish gamblers are estimated to lose around 10 billion Euros a year through casinos, lottery tickets, and sports bets.

Currently, the plans are under review and will have to be deliberated on by the Spanish authorities before being forwarded to parliament.

Denmark’s Strict Controls on Gambling Ads

The Danish Act on Gambling contains a section with stringent regulations on how gambling firms can advertise; all gambling ads must comply with these regulations as well as those outlined in the Danish Marketing Practices Act.

Gambling ads in Denmark must not overstate customers’ chances of winning games, must focus on gambling as a kind of diversion rather than as a legitimate means of earning money, and cannot communicate with minors, either directly or indirectly. Denmark also bars celebrities from claiming that gambling played a role in their success. All bonus offers must also be promoted with full details on terms and conditions.

Denmark also allows problem gamblers from opt out of receiving all communications from gambling firms by signing up to their national registry of self-excluded persons.

What is the Moral Responsibility of Online Casinos?

Online casinos, like any business want to make as much revenue as possible. It is their responsibility to serve their shareholders as much value as possible. Advertising is clearly an essential component of attaining success in the industry.

Pulling back their marketing budgets would likely be the prudent move. Not only will online casinos save money they could use to launch better promotions in the future, they will also gain valuable public approval for their cooperation with gambling ad rules.

Online casinos must ensure that problem gamblers are taken care of because it would be the best thing for gamblers all over the world. Online casinos already have a bad image of flouting rules and regulations if it means gaining more revenue.

If online casinos want the gambling industry to continue on its global path toward legality and respectability, they would be well-advised to protect their customers when they are most susceptible and work within the imposed regulatory guidelines.