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How do bookies make money? How can you bet differently to help yourself?
Overround, vig, juice, vigorish and negative book margin all affect your betting. Learn the bookmaker tricks and place more bets with confidence.
Published on 19 December 2018
Updated on 19 December 2018
Betting Tips for Today's Football
Find more value in your next football bet. You could gain a betting edge by checking out the tips and stats for today's and tomorrow's fixtures...
For those that don’t know how bookies make money, this post is for you. For everyone else that may think they know how bookies make money; you should probably keep reading, as what you think you know is not necessarily true!
Bookmakers make money several different ways, but the following list covers the main areas that should concern any sports bettor looking to improve their knowledge of betting markets and bookmakers.
• Bookmaker profit basics; margin between winning and losing bets
• Odds manipulation and control
• Expected value
• Trading across global markets and betting exchanges
• Pushing bettors towards multiples and accas
The basic approach behind all bookmaker profits
All sophisticated and unsophisticated bookmakers will make money through betting public’s margin (the difference between the amount of money placed on a bet and the amount of money that is returned to winning players).
Unfortunately for the unskilled sports bettor, modern bookmakers are extremely efficient businesses that are very well practised at balancing risk and reward across many transactions.
Some of the larger bookmakers concentrate on massive betting volume and some even compete by taking smaller and smaller margins from winning players while advertising heavily to attract worldwide sports and casino punters.
The massive advertising campaigns for the global sports betting and casino brands are designed to push content to you, so you create a betting account and start to place bets. The volume of money flowing through their betting platforms will control the amount of money they return rather than increasing their profit on each bet.
Have you ever thought why bookmakers offer new players a variety of different promotions? It’s because they will have a profit number for each player and the number of people playing their casino games or placing sports bets will have a large say in the amount of profit at the end of their financial year.
The best bookmakers are not obsessed about underdogs winning matches or unforeseen score lines, as they’re more concerned about balancing their risk across each bet and ensuring their profit margins are suitable for each of the different events.
It’s more profitable for bookies to balance each side of a bet as much as possible and manipulate the conditions, so players are more likely to place bets on multiple sides of the bet and multiple selections, as much as possible.
Odds manipulation and control
Most bettors understand the basic concept of what betting odds really mean, which explains a little of how bookies will use the odds to ensure they can return a profit from each football bet.
However, this does not include how the odds may be artificially changed to convince and tempt players based on public opinion and how much margin (aka overround, vig, juice, vigorish) the bookmaker will accept for the specific event.
Let’s look at a quick example, I’ve checked through the soccer statistics database and collated all the results into the table (below) for each of the major soccer leagues.
You can double check the book percentage of each event by doing some simple addition. You must take the decimal odds and perform the following calculations:
Book Percentage (%) = [(1 / Home Odds) + (1 / Draw Odds) + (1 / Away Odds)] x 100
Any event in real life has a 100% chance of occurring. Think about a fair coin toss. There is a 50-50 chance of heads or tails occurring, which would translate to 100%.
Ideally, in a betting situation you want to find a selection of sporting events from a bookmaker where the Book Percentage is below 100%. This means that the book for the sporting event contains mathematical value. You could simply place a bet on every outcome and make a profit!
|Country|| League|| OddsH|| OddsD|| OddsA|| Book (%)|
| Ligue 1|| 2.67|| 3.93|| 4.63|| 85%|
| J. League Division 1|| 2.43|| 3.39|| 3.16|| 102%|
| Jupiler Pro League|| 2.48|| 4.03|| 4.22|| 89%|
| Eredivisie|| 2.86|| 4.41|| 4.84|| 78%|
| Premier League|| 3.00|| 4.18|| 5.12|| 77%|
| Glo Premier League|| 1.49|| 1.62|| 1.89|| 182%|
| Liga BBVA Bancomer|| 2.18|| 3.30|| 3.52|| 105%|
| Serie A TIM|| 2.96|| 4.11|| 5.01|| 78%|
| El Campeonato de Primera Division|| 2.33|| 3.20|| 3.94|| 99%|
| Campeonato Brasileiro Serie A|| 2.14|| 3.40|| 4.35|| 99%|
| Bundesliga|| 2.58|| 3.96|| 4.37|| 87%|
| Hyundai A-League|| 2.38|| 3.75|| 3.60|| 96%|
| Chinese Super League|| 2.59|| 4.12|| 4.31|| 86%|
| Superliga|| 2.67|| 3.74|| 3.78|| 91%|
The fascinating thing, is that it’s possible to recognise arbitrage value across bookmakers by finding a combination of selections across different bookmakers. If you check out the average odds across bookmakers for previous matches, you can see the leagues where there is substantial mathematical value based on the book percentage.
Look at the percentage winning column, this will show you have much the event (or as known in the industry, the book) is slanted towards the bookmaker.
This means that the bookmaker will be retaining that percentage from the winning players, which is another reason why they want to increase the number of players across each of their betting events. Combined with adjusting the odds to ensure a profitable betting event is offered for each of their betting events.
Understanding expected value and "real-expected value" is something that is vitally important for any sport bettor and definitely football/soccer punters and traders. This means that you can identify if a potential fixture contains a realistic bet that can help you to provide more information for the different fixtures.
Bookmakers have increased betting flexibility by allowing us to customise our bets for many different situations. Customising your bets can help you choose better selections based on expected value and soccer statistics.
Think about it, why would a bookmaker advertise and actively promote a betting option, which would lose them money over the long term. They must have paid countless thousands for the advertising campaigns, they pay for the professional marketing organisations to help them with the campaigns and then when they gain players willing to customise their bets, the bookmaker will lose money from each player's customised bets?!
Does that sound realistic to you?
No. It doesn’t. The campaign is designed to drive players towards a fun pastime, but it may not be correct for your preferred betting strategy.
The only way to reduce this is to use all betting platforms sensibly.
You should only ever use bookies to place a sensible bet, which you have carefully considered for long-term benefit, such as, trading, legal arbitrage, matched betting or value betting are the only realistic options to profitably bet using bookmakers.
Using one of the above approaches is a good place to start for many bettors, but you need to be sensible, so you can make money and not continually lose money, as everyone is trying to increase their profits. You, the betting exchanges, the bookmakers and all the players are trying to do the same thing (and some people have a lot more experience than most of us).
Trading across global markets and betting exchanges
Many bookmakers will also have a trading division that will play the betting exchanges and worldwide betting markets, so they can ensure they make a profit outside of their traditional bookmaking activities.
Many of these companies will have amassed a lot of information, stats and knowledge across many different betting markets, which will allow them to really change the question from how bookies make money into how can bookies find more ways to make more money within their industry?
You and I may not have access to the same resources, but we can emulate the bookies by watching what they do? If you check out the betting market movements and you understand how smart money is betting, it could help you to recognise where you should place your money or avoid placing your money if you prefer contrarian betting.
Pushing bettors towards multiples and accas
Multiples, accas and build your own bets are popular methods to increase the betting interest for many recreational sports bettors.
However, this is exactly where the bookmakers want to keep you. This way they’re in with a chance of receiving more profit from their transactions.
The build you own bets are sometimes approached by people that like the idea of different betting options, but they don’t want to think about the real probabilities of the events.
Try not to get caught out!
Accas are a lot of fun but try not to risk any amount of money on a “throw away” bet, just because you think the odds are worth a shot.
This is the easy way for bookmakers to gain profits if you waste your money without having a clear idea of how you make betting profits and increase your bankroll over time.
Now it’s time to think like a bookmaker and improve your betting chances
Take the time to review your betting options make the best betting decisions for your long-term bankroll. If you consider how bookmakers entice you to place bets on poor selections by moving odds out of your favour and increasing the book value.
Or offering promotions and incentives for multiples and accas, this means that bookmakers may not be offering you the best selections for your long-term bankroll.
Hopefully, this will help you to make better betting decisions with your money.
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