Athlete, Celebrity & Influencer Marketing in Ontario
THE PROPOSED BAN ON ATHLETE AND CELEBRITY ENDORSEMENTS IN GAMBLING ADVERTISING AND MARKETING TAKES THE PROVINCE DOWN A FAMILIAR AND REGRETABLE PATH
Since Ontario opened its new competitive model for the operation of online gambling (“iGaming”) in June 2022, Ontarians have witnessed a surge in advertising for numerous licensed private iGaming operators. Frequent television ads, particularly during major sporting events, have been perhaps the most noticeable change. Many of the major operators, in particular sports betting operators, use celebrity and athlete influencers in their advertisements. Wayne Gretzky, Connor McDavid, Charles Barkley, Auston Matthews and Kevin Garnett are some of the prominent current and former professional athletes most commonly seen on television in Ontario.
Anecdotally, I can report that some Ontarians have come to see these seemingly omnipresent ads as an irritant. When people learn that I practice law in the iGaming field, they often bring up the frequency with which they see iGaming ads. Based on that experience, I imagine the people who work at the Alcohol and Gaming Commission of Ontario (“AGCO”) (the Ontario iGaming regulator) hear similar comments.
That general feeling of irritation may have had a hand in the proposed amendments to the advertising and marketing provisions of the AGCO Registrar’s Standards for Internet Gaming (the “Standards”). These amendments would require registered operators and suppliers to cease any advertising and marketing activities that use active or retired athletes in gaming marketing and advertising. They would also broaden an existing prohibition against ads that “contain cartoon figures, symbols, role models, and/or celebrity/entertainer endorsers whose primary appeal is to minors” by extending that ban to ads that contain “cartoon figures, symbols, role models, social media influencers, celebrities, or entertainers who would reasonably be expected to appeal to minors.” In combination, these amendments would eliminate all iGaming advertising and marketing that features athletes from the Ontario market, and severely curtail the ability of Ontario operators and suppliers to use celebrities and influencers in ads.
The vulnerability of underage persons is the stated rationale for these amendments. It is implied that advertising and marketing that uses athletes and celebrities are of particular appeal to people under Ontario’s legal gambling age of 19. The AGCO referred to the existence of “concerns that gambling behaviour among these underage persons is being encouraged due to the appeal of celebrities and/or athletes who are associating themselves with promoting gambling activities.”
I am not aware of any evidence specific to the Ontario market that might substantiate that there is an air of reality behind these concerns (from wherever they might originate). If studies exist that have concluded that underage gambling is in fact encouraged by marketing and advertising that features celebrities and/or promoting gambling activities, they likely originate in markets outside of Canada.
Input was sought from stakeholders, but only on the basis that it had already been concluded that (i) the risk to underage persons was real, and (ii) the proposed advertising restrictions were appropriate to address that risk. It was announced that what was being sought was “stakeholder input…related to advertising and marketing to address this risk, along with a proposed implementation approach that would support the amendments coming into effect.” It did not appear on its face that stakeholders were being invited to question the existence of the perceived risk or to press the case for alternative means of addressing that risk.
It seems likely that the anecdotal public irritation with iGaming advertising in general to which I referred at the outset is an unspoken motivation behind the decision to impose these new advertising and marketing restrictions. Perhaps inspired by internal polls of public opinion on the subject and by the imposition of similar restrictions in the UK, the regulator is responding to a general sense of public fatigue with frequent advertising for iGaming, particularly television ads during sporting events.
As long as the frequency with which the public encounters iGaming ads does not change, there will continue to be a demand for further restrictions. These pressures will not likely be limited to advertising and marketing tied to underage gambling, although the advocates of further restrictions may continue to use that issue as a justification. A number of politicians have determined that the advertising of iGaming in Ontario is an issue with enough salience to use against the present government, which brought in the new Ontario iGaming model. Within the space of a few days in June, each of the two opposition parties in the Ontario legislature staked out positions demanding further restrictions on iGaming advertising. The Liberal Party of Ontario issued a statement that acknowledged the proposed amendments to restrict advertising that uses celebrities, and then quickly moved to lobby for further restrictions, urging the Ontario government “to work with relevant regulatory bodies and stakeholders…to further regulate the frequency of online gambling and sports betting advertisements, specifically during live television, radio, and online sporting events.” A few days later, members of the legislature belonging to the Ontario New Democratic Party stood in support of a private members’ bill that would, if enacted, ban all iGaming advertising without exception. Two weeks later, at the federal level a member of the Senate introduced a bill that would have the federal government work with the provinces and other stakeholders to impose further regulations on the advertising and marketing of iGaming.
Clearly, if the goal of banning advertising and marketing involving athletes and imposing limits on advertising and marketing involving celebrities and influencers was in part to stem public discomfort, the amendments will not succeed on that level. The moral panic wrought by the increased frequency of iGaming advertising and marketing in Ontario will not be assuaged. If the government imposes restrictions without engaging in real, meaningful consultation with the industry, it will be subject to demands for further restrictions immediately after it enacts these restrictions. This will quickly rise to demands to ban advertising and marketing for from television during certain times, and then to ban advertising for iGaming completely. This has been the experience in Australia, which in 2018 banned the airing of sports betting ads after 8:30 pm during the course of televised sporting events, and which now is seeing a call for a “comprehensive ban” on ads. There is every reason to suspect that the Ontario regulatory environment will evolve along similar lines.
Very few studies have sought to determine whether a link exists between athlete/celebrity participation in iGaming advertising with underage gambling. The few that exist appear to originate outside Canada, primarily from Australia. Further, these studies only surveyed how Australian parents and children perceived the way in which athletes and celebrities were used in advertisements. They did not seek to measure the actual effect of those advertisements on underage persons.
The essential problem with the current approach is that it did not bring in private sector stakeholders for consultation earlier in the process, to obtain a full range of views on whether the concerns identified have a basis in fact, and whether there are alternate ways of addressing those concerns. Early consultation of that kind might have resulted in an enhanced focus on ensuring that the rationale for proposed restrictions on iGaming advertising and marketing were evidence-based. Proposing changes to the Standards on the basis that “there are concerns” that athletes and celebrities having a role in the marketing and advertising of iGaming encourages underage gambling is a “many people are saying” argument. “Many people are saying” can be the starting point for public policy in a liberal democracy, but the next step should be an evidence-based inquiry into whether what they are saying is in fact true.
Regulatory bodies in Ontario are explicitly committed to making “evidence-based decisions to regulate in the public interest.” Canadian sources of evidence linking the participation of athletes and celebrities in the advertising and marketing of iGaming to increased underage gambling should be sought to substantiate the perceived risk of such advertising and marketing before a decision is made to impose restrictions. The enactment of the proposed amendments to the Standards should be postponed until the industry has an opportunity to sit down with the government to determine whether an evidence-based link truly exists between athlete and celebrity participation in iGaming advertising and underage gambling in Ontario.
Moreover, if evidence does demonstrate that the use of celebrities and athletes in iGaming advertisements “increase(s) perceptions of trust and…credibility”, and that commentary-style promotions featuring celebrities and athletes are “more convincing, trustworthy and authentic” in the minds of a youth audience, those features can in fact be used to enhance responsible gaming in Ontario. Such evidence would support allowing celebrities and athletes to be featured in advertising and marketing that promotes responsible gambling messages and education.
A similar exception already exists in Ontario, in the context of restrictions imposed on the use of “well-known personalities” in liquor advertising. Those restrictions apply only “if the advertisement contains any direct or indirect endorsement of liquor or the consumption of liquor,” and for greater clarity it is specified that those restrictions “would not apply to public service advertisements provided there is no direct or indirect endorsement of liquor or consumption of liquor by the well-known personality.”5 As presently drafted, the amendments to the Standards would prevent the promotion of responsible gambling using celebrities and athletes, demonstrating that the amendments have been drafted in an overly-broad manner. This is an unintended consequence that might have been avoided if the industry had been consulted earlier in the process.
Regulated iGaming operators in Ontario are responsible actors who want to want to have a constructive relationship with all of the interests that are represented in the Ontario market, including responsible gambling advocates and organizations concerned with underage gambling. Given the non-confrontational relationships that exist in this newly-regulated market, it makes the greatest sense to work with the operators at every possible stage of the public policy process, rather than have them respond ex post facto to decisions that have already been made. This will hopefully be the route followed if further advertising and marketing restrictions are considered in the Ontario iGaming market in the future.