Enjoying a flutter on your favourite sport is a long held tradition for fans in the UK and gambling is one of the very few industries that has continued to grow throughout the recession.
Why so? Well, McBookie co-founder Paul Petrie says the easiness of gambling and the introduction of apps in recent years has all contributed.
An avid sports fan, Petrie always had an interest in gambling, but it wasn’t something he ever considered a career in. That was until he left his London PR job to move to Manchester and take up a new role at Totesport. After spending several years learning the inner workings of the industry, Petrie saw a gap in the market due to what he describes as a ‘lack of experience in Scottish sport’ from the wider known British bookmakers.
"Understanding Scottish sport and Scottish customers are the two key things for the McBookie brand" - Paul Petrie
Seven years on, McBookie is continuing to go from strength to strength and has built a solid core of Scottish customers on which it can depend on and tailor its odds to suit.
Golf is no different from any of the other sports McBookie offers markets on in that regard, and is actually one of the top four sports it receives bets on.
“Understanding Scottish sport and Scottish customers are the two key things for the McBookie brand,” says Petrie. “Because we are independent, we can make decisions that are more customer-friendly than the bigger companies.”
When it comes to setting odds, McBookie works closely with another bookmaker that provides feeds for independent firms to be able to tailor the odds specifically for their Scottish market. This is an aspect that normally works in their favour but could have worked significantly against them had there been success for either Marc Warren or Paul Lawrie at this year’s Open Championship.
“From our perspective, the Scottish guys were an absolute nightmare because people back them and they were sitting first and second on the leaderboard going into the weekend,” explained Petrie. “Lawrie and Warren were our two biggest losers for the week, the ones we’d lose the most money on. Most people were saying a Scottish win would be a great result for the bookies and I’m sitting there thinking this is going to be a disaster.
“Lawrie was 300/1 at the start of the tournament and people were chucking £1 or £2 on him, while Marc Warren was still out at 150/1 at the start of the week despite doing well at the Scottish Open the week before. They fell away, though, so I could relax a bit more on the Sunday.”
In simple terms, big name winners are bad for bookies, and first-time winners are great news. In between all of that, though, it’s about managing liabilities for the bookies.
“When it comes to setting the odds before the start of a tournament, you can change the odds appropriately to suit your liabilities. For example, heading into the Open, a lot of money had been placed on Jordan Spieth to win. As the tournament drew closer, we got to the point where we didn’t want too much more placed on him, so we shortened the odds to lower than our competitors so fewer people see him as being worth a punt.
“At the start of the Open, we only had ten bets on Zach Johnson in total. It was a fantastic result for us because people were using the same logic as our odds compilers.
“A good result in golf is when you’ve got the guy who doesn’t normally perform well, doesn’t hit the guidelines of who should be performing well at a particular course, but goes on to win. If it’s the guy who is tipped up by all of the tipsters, ticks all the boxes and has good course form, it’s going to be a losing week.”
As an independent bookmaker, McBookie outsources a lot of its work. The majority of its odds come from a feed, and Petrie explains that the bookmaker the feed comes from will have ‘about three or four guys’ who work specifically on golf. Those are the odds compilers, who will position players where they feel is appropriate for the week ahead.
But what do you do about Tiger? Having been injured at the end of last year and showing little sign of any form throughout this year, the bookmakers had tough decisions to make. At the start of the year, particularly at the Masters, Woods was still priced as one of the favourites, and Petrie says he was still being priced so low because people were still prepared
to back him.
He said: “Admittedly he was getting pushed out later in the season but he was still only about 33/1 for the Open. Regardless of his form, you know he’s got the capability to potentially come back, so we can’t position him where his form says he should be.
“Going by the book, he should be a 100/1 shot, but if you put him in at that price, your liabilities will quickly be hitting £1m. All you have to do is look at the Quicken Loans event. He was sitting two off the lead heading into the weekend. Imagine you had priced him at 100/1 in a major and he puts in that performance in the first two rounds.
“With a lot of these better players, you’re still edging on the side of caution, mainly because people will still be prepared to back him. Even when I was sitting there getting ready to put my bets on, I was thinking ‘Tiger might win this!’ To date he’s won 77 PGA Tour titles but those wins were across only 25 events. He had already won at St Andrews twice, too. I was convincing myself that he could do it. Thankfully, I never followed through on it.”
For McBookie, there are five big tournaments for golf betting. Number one is the Open, number two is the Masters, and then you have the Scottish Open, US Open and USPGA all on a level playing field. The bookies have had some big wins over the years but they’ve also had some massive losses. It was in 2013 McBookie’s worst golf finish occurred.
“When Phil Mickelson won at Muirfield, that was an awful result for us,” said Petrie. “He had won the Scottish Open the week before, nobody had ever done the double, but people had backed him to win at Castle Stuart and reinvested their winnings on him for the Open. We already had a massive liability on him before the tournament even began.
“The recreational punter had watched the Scottish Open, seen him win, saw he was on form and placed a bet on him.
“Some people had even placed bets on the double for him to win both the Scottish Open and Open, then I think going into the final day he was about 16/1 to win and people were piling on that because they were looking for value. It wasn’t a good day for us.
“On the other hand, we’ve had a few good days, too. Zach Johnson at the Open this year was a result. YE Yang winning the 2009 PGA Championship and Lucas Glover winning the US Open that same year were great for us, too.
“You’re always going to have both happen over the years, we just need to make sure we are on top more than we’re not.”
Beware! The Dead Heat rule
“People don’t understand how it works when we’re paying out for players finishing in the top-six and then five guys finish in a tie for sixth place and they end up winning £3,” explained Petrie.
“It is quite complicated and you can understand why the recreational punters are a bit miffed by it all. If you’re paying four places and three guys finish in that fourth spot, you’ve got to half your odds or half your stake.
“So, if you put £10 on, you’re actually only winning what you would get if you put £5 on because you’ve shared the place with someone else. When you’re looking at the four places, it’s not so bad but, when you’re looking six and seven places, I think for the Open, there were four guys sharing sixth place, so you’ve then got to calculate that you’re only then getting a fraction of your stake, and then some people will have only put it on each way. In some cases, people backed Justin Rose each way at 14/1 and were only getting £1 back.
“That’s less than they put on because they lost their win part and they also lost four-fifths of their each-way part, so then we get loads of guys complaining that they’ve not got any money to show for it.”
McBookie in bunkered
This interview with Paul Petrie of McBookie first appeared in issue 142 of bunkered (published: September 2015).