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Befair’s “Middle Man” Ad Banned by ASA

11 February 2011 by admin

Betfair-Middleman-Football-still-3A recent Betfair television advertising campaign told viewers to “cut out the middle man.” The Adverting Standards Authority is now telling Befair to cut the commercial. According to the ASA, the commercial is misleading because it doesn’t specify that the company still takes a commission.

In the TV ad, there are two men sitting in a pub talking about sports. A third man then arrives, pushes himself between the two men and begins passing comments between them. Rather than directly talking to each other, the communication, annoyingly, is passed through the middle man. The commercial ends with a voiceover that says “on Betfair, you cut out the middle man, which means you could win bigger.”

All of that is accurate, but after the ASA received complaints, they looked at the ad and decided that it is misleading. Betfair takes a 5% commission fee on winnings and according to the ASA, the commercial implied that there are no commissions at Betfair. The ad was then banned and cannot be rebroadcast in its current form.

So is the ASA correct or is the commercial accurate? The ASA hangs their argument on their opinion that by taking a commission, Betfair does actually have a middleman role. However, the ad was meant to stress the difference between a betting exchange and a traditional bookmaker. With a traditional bookmaker, the company chooses odds for each bet in an attempt to balance the action, so no matter what outcome takes place, the bookmaker won’t take a loss. Instead of betting against other punters, people bet on the odds provided by the bookmaker.

A betting exchange works like a stock exchange or an auction. Punters place bets directly against each other, using the exchange to facilitate the betting. Betting exchanges are done like when you placed bets with a friend as a kid. You think something will happen and say “wanna bet?” If someone says yes and bets against you, at the odds you chose, you have a bet. Exchanges like Betfair provide the software that facilities these bets by putting punters in the same place and processing the transaction. However, the exchange is not actually involved in the bet and has no stake. To make money, they charge a commission on the winning bet; at Betfair that commission is 5%.

In response to the ASA, Betfair pointed out that fine print on the ad said that terms and conditions applied. They also said that their claim of cutting out the middle man is accurate because at their betting exchange, punters can bet directly against each other rather than through a bookmaker. That seems reasonable enough to me, but the ASA disagrees.

The UK’s Advertising Standards Authority is an independent self-regulatory group that is not run by the government yet still wields much power. If they ban an ad, all broadcast media are instructed to stop playing the ad and those broadcasters are bound by the ASA’s rulings.

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