Generating long-term player loyalty from a price aware customer base is one of the problems that sportsbook operators find most difficult to tackle. But the team behind the start-up Scrimmage believe their product is the solution that the sports betting industry has been looking for.
Scrimmage’s gamified loyalty program certainly impressed the expert judging panel for the First Pitch competition at the SBC Summit North America 2023 conference, where the company landed first prize. Following on from that success, its Co-Founder Dan Taren tells SBC Americas more about the product and how it can be a cost-effective retention tool for operators in competitive markets.
SBC: Could you start by telling us a bit about the team who founded Scrimmage and why you decided to launch the business?
Dan Taren: Myself and Scrimmage’s other co-founder Matt Dever originally started Fremont Capital Partners, which was a hedge fund set up in Gibraltar that was meant to generate a return by sports betting. We had some success here, but ultimately regulation and legal fees forced us to reconsider our business model.
This led us to start Scrimmage. Scrimmage started as a B2C product to help bettors gain an edge, and after a few iterations, we found a glaring need for more customized and thoughtful loyalty programs within the betting space.
SBC: What’s the thinking behind the Scrimmage product? And what gap in the market does it fill?
DT: Scrimmage builds gamified loyalty programs for betting operators, with a major emphasis on ‘gamified’.
Humans are motivated by a multitude of different factors, one of which is risk-taking. The betting industry has done a phenomenal job catering to this motivation – but not other powerful motivational factors.
Scrimmage fills that gap by creating a loyalty game that allows bettors to be creative, to customize their experience, to progress, to be challenged, to share in the experience with other bettors, and so on.
These are all experiences that mimic successful video games, and we continue to build experiences to fill the needs of the different types of ‘players’ within betting products, while complementing what makes betting so fun.
Operators can continue focusing on their core product, while we focus on building a loyalty solution that retains their players and makes them significantly more active.
SBC: The need for products to help US sportsbooks retain their expensively-acquired players is well known, making licensed sports betting operators an obvious target market for Scrimmage. Are there other strong use cases for the product?
DT: Scrimmage is uniquely suited for betting operators. There are several rewards programs out there, but ours is specifically built as an additive to any product where the user base is risking money to make money. Because of this, we can be incredibly impactful for any iGaming product.
Additionally, our business model caters to any type of operator business model. We charge no SaaS fee and no one-time development fee – consistent with the rest of our gamified product, we monetize like a video game. We monetize if the operator’s users choose to spend their rewards within the game on things like questlines, cosmetics, and level-ups. In other words, if the operator’s users choose to cash out all their rewards given to them, we do not get a cent of that. We are that confident in our added engagement.
Therefore, we are no cost directly to the operator – which fits any iGaming product.
SBC: The key to successful apps of all types is getting both user experience and reliability right. What sort of research process did you undertake when developing the product and what types of technology does it use?
DT: We built a rewards program for bettors as a B2C app and tested each feature to figure out what works and what did not. This resulted in a nearly 6x increase in the daily average handle from our users who played the game. From there, we turned our technology into a white-label version for operators to benefit from. Some benefits of our technology include:
1. Operators can allow Scrimmage to give quests to their users, or operators can easily create their own through our dashboard. Our quest system is extremely flexible, if you send us the data, we can reward users for it. That means quest creation is not just limited to bets, but can also be for things like referrals or screen time. Whatever an operator wants their users to do, Scrimmage can facilitate through easy to create quests.
2. We aggregate no sensitive data and we do not need to know a user’s name, email, or any other type of personal details. With just a user ID, we can use AI to customize quests for users, building upon the type of quests they tend to accept and complete. This is powerful for operators to help their users make their betting experience feel personalized to them.
3. Quests do not have to be simple. We have the ability for group quests between an operator’s user base, time-sensitive quests, quests that you can schedule beforehand, limited quest-lines for certain users, and quests that build upon previous quests to create story-lines. Every different type of user can be catered to simply.
4. Operators do not have to define every custom field, we can index that data automatically, reducing integration time substantially.
5. Our partnership with Prizeout allows users to cash out easily with gift cards.
6. Operators can also choose for rewards to be redeemed in free bets rather than leave the ecosystem.
7. Users can customize their game with upgradable perks that are specialized for their play style, and operators can easily add perks to their system that are unique to their product.
SBC: The benefits of increased player engagement to operators are obvious. But what do they have to do to get those benefits – does Scrimmage require significant input from operators’ tech teams?
DT: We are technology first at Scrimmage, and ease-of-integration for operators with different technology stacks is one of our main priorities. Our integration steps are well documented on our website. There are three options to choose from:
1. For operators that want to integrate our loyalty program natively, we allow for access to our API which removes the need to use our widget, aside from JavaScript, which we have in an SDK library.
2. For operators looking for even quicker integration and less on-going maintenance, our iFrame can be integrated into a mobile app or website extremely quickly. We are equipped to easily customize to the operator’s UI to create a native feel for their users.
3. Finally, our technology can be packaged as an enterprise software license, so larger clients can have it on their own servers.
SBC: Scrimmage recently won the First Pitch competition for start-ups at the SBC Summit North America conference. How does that kind of recognition help your business?
DT: For an early-stage company, especially in the B2B space, validation is extremely useful.
Loyalty programs are wildly popular in so many industries, but in iGaming the different operators have been slow to adopt. The First Pitch competition allowed us to convey why our loyalty program is so uniquely beneficial to an iGaming company, and the subsequent six letters of intent following the pitch have been a testament to that.
SBC: And finally, what can you tell us about Scrimmage’s plans for the next couple of years?
DT: Our plans are to keep building the most engaging loyalty software for the iGaming space. There is no shortage of product enhancements we can build to make betting more fun for the different types of players that exist.
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Find out more about the Scrimmage rewards app, how it works and how to get started with it at the company’s website.
