Sports betting operators face difficulties quantifying the effect of home-field advantage due to games being played behind closed doors and with zero audience. William Hill already reported in a Q3 trading update it had its profit margin slashed due to a string of unpredictable results.
William Hill told shareholders the lack of fans in the stands at sporting events explains the series of unlikely results that have negatively influenced the company’s top line, and as the soccer season is set to continue behind closed doors, the sports book operator noted its expectations for surprise outcomes to continue.
Setting the Odds
Bookmakers very much need to be able to estimate the likely winners of sports fixtures, to set appropriate odds, but the fact that sports has been played with no live audience diminished on the psychological effect of home-field advantage.
And while William Hill is not the only sports betting operator being affected by this new challenge, it is the one which takes most of its bets from soccer. As its US competitors mainly deal with professional and collegiate football, they have more leeway of setting the odds and have not faced the same impact on profitability.
Andrew Mannino, a senior sports content analyst at PointsBet, argues that the larger the spread, the lesser the impact a home advantage is expected to have. As in football the spread is much bigger than in soccer, the home-field advantage is having a much lesser impact on the outcome.
Lack of Historical Data
In fact, the real reason why bookies have been experiencing difficulties in setting the appropriate odds is the lack of historical data for them to lean on, as playing behind closed doors is not something seen often in the past, Mannino continued with his analysis.
In the case of William Hill, the operator has some data from the last year’s season in the Premier League which completed without crowds, but it is a very small sample for a reliable model to be built on, compared to the more than 10 years of normal audience games data.
Mannino’s findings are supported by Nick Bogdanovich, director of trading at William Hill, who agrees that the bookmaker’s ability to set odds is hampered by the data point limitations.
“We’re in brand new times. There’s nothing to fall back on but your gut and a good guess.”Nick Bogdanovich, Director of Trading, William Hill
As the season progresses, though, the sports book operator which is also subject to a takeover bid from US casino giant Caesars Entertainment, will continue to gather data and further sharpen its odds setting tools.