Italy was ticked off the list last year on the Stake M&A pipeline as part of the crypto-first giant’s forays into regulated markets across the globe. The operator acquired Baldo Line, the parent company of IdealBet, from Octavian Group last summer for an undisclosed fee. For now, the IdealBet site is still live, although the imminent shift to Stake.it is in the offing.
Stake was also one of the 46 brands to be approved by Italy’s regulator as part of the new licencing regime, which will see a longtail of smaller firms drop out of the market. The licence will cost €7m, with the final list of operators due to be confirmed in November.
For Stake, the challenge is a tough one. Despite having tapped former PokerStars head Fabio Bufalini as country manager, the competition is fierce. Flutter and Lottomatica dominate almost two thirds of the market, while big players like Entain, bet365, evoke and LeoVegas Group are also present.
Despite tough advertising regulations and weaker online penetration versus some other mature European markets, Bufalini insists he is ready for the challenge. Here, he tells EGR why he joined the operator and his plans to tackle the market.
EGR: Can you talk us through Stake’s strategy for Italy?
Fabio Bufalini (FB): Stake acquired IdealBet from Octavian Group last year. This year, we have been preparing to launch the Stake.it platform. We have made all the changes and we are ready to launch. The Italian market is very mature and there is a lot of competition. We want to be at the right level of competition in terms of product before starting.
This is my fifth company in Italy. Stake is a big company. This time it is slightly more complicated because it is the first time I have launched a brand from scratch in Italy. Many younger people know Stake, but I still have to get the right brand awareness, and with the advertising ban, this will not be easy. We have to find the right way and the right angle to promote ourselves, along with the product being at the right level. We will have both online casino and sports betting.
EGR: What does the current IdealBet operation look like from a GGR perspective?
FB: We have a small amount of players and GGR. We will migrate to Stake.it as soon as we can and IdealBet will be closed.
EGR: Why did you decide to come back to the igaming space last year and why with Stake?
FB: I worked at PokerStars and PartyGaming before. I never left the gaming environment. I was also a consultant for many other companies. Then, Stake appeared. It’s a great opportunity because I think they have a great project. Stake is changing their strategy. They are entering regulated markets worldwide. They entered Latin America, in Peru, Colombia and Brazil and in Europe with Denmark and Italy.
I was in Melbourne last February, and in the last two years the headcount grew from 100 people to 600 – it’s crazy. The Italian market is tough, but at the same time; I think a company like Stake has understood the opportunity.
EGR: What impact do you expect the licence process to have on the Italian market? Will Stake be able to take market share with less operators present?
FB: The companies that will leave the market are smaller operators that mainly do business via point of sales. That’s an opportunity. There is a big change in the market and there is the opportunity for us to get a part of this market share. The market is still growing at 20% a year, so there is opportunity to grow.
EGR: Do you have any targets for what that market share could be in the future?
FB: The company knows very well, and I said this from the first day, that this is not an easy journey. They understand it has to be a mid- to long-term goal. We will not be at 20% market share in two years. As a global goal, Stake wants to be present in the biggest markets in the world, and Italy is one of them.
EGR: How do you leverage the omnichannel aspect of the business given retail still has a strong grip in Italy?
FB: We still have around 50 retail points of sale. We want to retain them [with Stake]. It’s not clear how we want to do it, but we will do something. We need to see how the rules change around deposits.
It is an opportunity. We are an online operator, so our main business is online, but we will see how we can make it happen. Retail players are better in some ways than online players because online has a lot of [bonus abusers]. The retail business is players who want to play. The customer lifetime value is much better than online.
EGR: Can you give us an insight into the team you’ve built up since coming into the role?
FB: We acquired two employees from IdealBet. We now have around eight staff in Rome and operational support from Melbourne. At the start, I didn’t think we needed too many people. All the critical roles have been filled. We also have some support still from Octavian as we are still in a transition period from when they sold us.
EGR: How will you approach marketing in Italy given the strict regulations?
FB: There is still a lot of advertising via infotainment sites. We have Stake Sports, but obviously we want the customers to move on from there. We are a digital business, so we should have the digital conversion. So, let’s see. It’s not an easy process. But the ban has been a failure. It is a situation [the advertising ban] that has to be changed, for the interest of the industry and for the consumer.
The post Q&A: Stake’s Italy country manager on his new “great project” first appeared on EGR Intel.
Fabio Bufalini on why success in the market will not be an “easy journey” as Italy gears up for a significant change in its licensing regime
The post Q&A: Stake’s Italy country manager on his new “great project” first appeared on EGR Intel.