Compare Pay Per Head Software Providers

Imagine a smoke-filled shady shop hidden in the alley. A local high-street bookmaker is seated on the bench in the corner with his shoddy notebook and a pen. A person walks up to him, enquires about the odds, and strikes a bet on the Premier League game tonight. The player then takes a stroll back home.

That’s how the betting took place before the arrival of the internet. There was only a fixed window of time when the bookie was available to write down the bets in their books and deal with bettors. So the sports gambling industry couldn’t help but embrace the utilities of technology.

The bookmakers, or the bookies, and the players, or bettors, as they are both known colloquially, now visit websites on the internet that let them organize their gambling efforts. These sites with cloud-based software provide convenience to the players to place bets whenever they want. It saves time for bookmakers who were used to writing down bets in their notebooks and carrying around documents in their basement offices.

Later the bookies log in to their accounts and check who owes them and who they owe money to. And hey, there’s no submission of the credit card numbers, or sending money offshore – no handling of the betting money by the website at all.

The software provider company might even offer 24-hour customer support so that the bookie doesn’t even have to answer phone calls and deal with the bettors. The bettors are also pleased because they can wager without stepping out of their homes.

In exchange for civilizing and systematizing their business, the bookies need to pay a small fee per client to the companies that operate these websites (called pay-per-head sites).

What Is Pay Per Head (PPH)?

PPH websites facilitate the technical side of bookmaking for independent bookies by providing numerous sports betting options each day. The service lets players bet online all-day and comes with technical support, a call center, and other tools.

Modern bookmaking agents leverage PPH software to make their operations more efficient. They simply log in to the website to check, pay, and collect. What’s more? Bookies are charged a weekly fee, but only for the active players.

Outside of the weekly fee that the agent pays, no betting money goes through PPH. The financial transactions between the two parties remain offline. Since local independent bookies let players bet with credit, the per head service simply acts as a convenience.

Arguably these money management software providers for bookies are changing the negative stigma surrounding their customers. The technology of PPH lends sophistication to their modus operandi. Bookies can let their customers bet at any time of the day. They can conduct business on their own white-labeled website and avail a 24 x 7 call center service at a fixed fee from these PPH websites.

Further bookmakers no longer need to hang out in bars to find new clients. They can hire marketing and sales departments to run social media marketing campaigns, start their own blog, build an email list, and experiment with numerous other client acquisition strategies. Once players are onboard, bookies can deepen their relationships with them.

They need to manage their books and balance wagers on each team so that they earn a decent commission on every event. The understanding of the motivations and financial goals of every player is facilitated through the organizing capabilities inside PPH software. That’s loosely like the job of a stockbroker.

But the process of settling up (with the occasional threatening) remains complicated and locally conducted. So as long as gambling remains illegal and people try to evade paying, the stigma surrounding bookies won’t vanish. But the sportsbook and gaming industry are opening up with companies like Realbookies.com reporting a 30% growth rate of the female demographic in a year.

Perhaps it’s more apt to say that the best per-head services are attracting demographics beyond the stereotypical gangsters in Goodfellas.

How Does Pay Per Head Work?

It works by the business owner (the bookmaker) paying the software provider a small fee per head for each active user. This ensures the bookie will only pay for people that are actively using the sportsbook software.

The best part about doing things this way is that everything can be scaled quickly and simply. Whether you have just a couple of customers, or a thousands. You’re only responsible for collecting payments, paying out winnings, and increasing your clientele base.

Most PPH Providers supply a white label turnkey solution, meaning online bookies can have their businesses running in minutes, all branded and ready to put in front of your customers. From there, you’ll never need to worry about the small things, again.

Because of the huge savings, you’ll make on software development and staffing costs, per head services make real sense for all bookmakers.

Digitizing your book would require at least thousands of dollars in down payments and tens of thousands per month in development and wage costs for customer services. In addition to those costs, you’ll also need to consistently update your software which is another ten thousand dollars per month.

PPH Sportsbook software enables you to work “for” your business rather than “in” your business. We take great pride in knowing that our services to you and your players, is nothing but the best.

Most PPH Providers supply a white label turnkey solution, meaning online bookies can have their businesses running in minutes, all branded and ready to put in front of your customers. From there, you’ll never need to worry about the small things, again.

The Business Opportunity in the PPH Industry

By charging a relatively inexpensive fee per head from bookies, how much annual revenue can these software companies rake in? Well, PPH websites are ‘Software as a Service’ (SaaS) organizations. You can think of it as a Netflix subscription for bookies.

Just like a Netflix user can’t enjoy their favorite shows and movies without paying Netflix every month, bookies can’t relish the services and conveniences of PPH sites unless they keep paying for the active bettors. Except, bookies can’t share passwords like Netflix accounts because of sensitive data being involved.

It means the customers — in this case, bookies — present a long-term recurring revenue opportunity for per head websites. A SaaS business can operate at an overall gross margin as high as 73%! They just need to provide high-quality customer service and focus on retaining customers from switching to their competitors.

That’s what PPH websites try to offer with call centers and premium features, so that bookies get addicted to the luxuries and stick around for years. With that said, here are some numbers to put things in perspective:

• In the US alone, betting on sports games is a $150 billion industry.
• And the global online gambling industry is valued at USD 59.6 billion in 2020. Also, it’s expected to grow at a compound annual growth rate (CAGR) of 11.5% from 2020 to 2027.

Further Google Trends data shows that the interest in the search term “pay per head” has substantially increased in the last decade — there has even been a huge uptick in search demand since 2016 (with a possible contribution from improvement in data collection systems since January 2016, by Google).

Per head companies can afford dedicated call centers that take calls from bettors for troubleshooting their problems. Here’s a picture of the customer support at a Costa Rica based company, PerHead.com, which has been operating since 1997.

Though not the most reliable, a couple of per head companies claim to employ 51-200 people on LinkedIn. It’s no small feat to expand to that size and goes to show how PPH service providers are operating like large businesses.

About a couple of years ago, the eSports industry was reportedly worth $900M. Even with the advent of the COVID-19 pandemic in 2020 and with sporting events being shut down worldwide, the betting world hasn’t closed it drapes.

As reported by the sports betting software company EveryMatrix CEO to Wired, the betting volume for regular sports events has dropped by 80%! But they have quickly adapted to esports: in under a month, the volume of dollars incoming on esports went up by a factor of 10.