Free Bets can increase risk of gambling harms, per new research

Key Points 

• Research in Ireland shows free bets and money-back offers can increase at-risk gambling behaviors. 

• Those at risk for problem gambling are more impacted by betting incentives

• Many bettors do not understand the restrictions on free bets and money-back offers, including that their stake would not be returned when winning with a free bet. 

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A new study in Ireland conducted by the Economic and Social Research Institute (ESRI) and funded by the Gambling Regulatory Authority of Ireland, evaluated the impact of free bets and similar promotional “inducements” on betting behavior. This research is being used to help support efforts to increase regulations surrounding gambling and how incentives can be offered, including prohibiting targeted marketing efforts. 

Methodology of study

The ESRI recruited a group of 622 men under the age of 40 to participate in a controlled study. This study occurred right before the Euro 2024 soccer tournament aimed to assess how gambling promotions and free bets from companies influenced participants betting behaviors. 

Participants were given a set amount of money and could place up to 6 bets on the games. At the conclusion of the study, any unspent money and/or winnings were converted into raffle entries to win €100. 

Participants were then randomly sorted into two groups. One group received bets with offers attached (ie: free bets or moneyback guarantees) and the other group did not. It should be noted that there were bets included in the study that were “bad” bets, and even linked with an offer, were still not favorable to make compared to other available bets. 

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Study findings 

Free bets increased likelihood of overall betting

Before any incentives were offered, both groups placed bets of similar amounts. Once free bets or moneyback offers were made, the group with inducements bet more money on every subsequent bet, versus the group that were not given any offers. They spent approximately 10% more than the non-incentivized group. The group that received offers were also less likely to abstain from making a bet after their initial offer was given. 

Those at risk for problem gambling were affected the most

Participants were evaluated for their risk of problem gambling at the beginning of the study. Those who were deemed at a higher risk for gambling addiction bet more money and placed more bets when given incentives, than those with lower scores. The study found that inducements were not just a marketing tactic but pose significant financial risk, specifically for those with problematic gambling habits.

Inducements led to riskier bets and more money spent on “bad” bets

Free bet incentives or money back offers were found to increase participants' likelihood of placing bad bets. Inducements resulted in three times more “bad” bets being placed, with three times more money being spent on less favorable bets. The study shows that inducements “forced” participants into decisions that increase financial harm. 

Conclusions and takeaways

The results of this study concluded that inducements cause bettors to risk more, wager more often and engage in riskier betting behavior. This behavior connects to greater financial loss for consumers and increases profits for betting operators. Another takeaway from this study shows that many bettors do not understand the restrictions on free bets or money-back offers, including the fact that their stake would not be returned when winning with a free bet. 

The findings of this study support the need for greater regulation and potential restrictions on inducements and promotional gambling marketing tactics.  

Problem Gambling treatment in the United States

No matter how the betting behaviors began, if you or someone you know may be struggling with problem gambling, there are specialized resources for support and treatment. Care for gambling addiction can include a variety of options, including inpatient, group and individual therapy and/or support groups.

Birches Health offers both individual and group therapy services in virtual settings. Birches works with therapists who are trained in helping individuals with gambling addiction, providing specialized treatment plans for each client.  You can speak with the Birches team at 833-483-3838 or email help@bircheshealth.com to connect. Or if you’re ready for care now and want to book an appointment, simply click here to schedule one right away.