Predicting Limit-Setting Behavior of Gamblers Using Machine Learning Algorithms: A Real-World Study of Norwegian Gamblers Using Account Data

Abstract

Player protection and harm minimization have become increasingly important in the gambling industry along with the promotion of responsible gambling (RG). Among the most widespread RG tools that gaming operators provide are limit-setting tools that help players limit the amount of time and/or money they spend gambling. Research suggests that limit-setting significantly reduces the amount of money that players spend. If limit-setting is to be encouraged as a way of facilitating responsible gambling, it is important to know what variables are important in getting individuals to set and change limits in the first place. In the present study, 33 variables assessing the player behavior among Norsk Tipping clientele (N = 70,789) from January to March 2017 were computed. The 33 variables which reflect the players’ behavior were then used to predict the likelihood of gamblers changing their monetary limit between April and June 2017. The 70,789 players were randomly split into a training dataset of 56,532 and an evaluation set of 14,157 players (corresponding to an 80/20 split). The results demonstrated that it is possible to predict future limit-setting based on player behavior. The random forest algorithm appeared to predict limit-changing behavior much better than the other algorithms. However, on the independent test data, the random forest algorithm’s accuracy dropped significantly. The best performance on the test data along with a small decrease in accuracy in comparison to the training data was delivered by the gradient boost machine learning algorithm. The most important variables predicting future limit-setting using the gradient boost machine algorithm were players receiving feedback that they had reached 80% of their personal monthly global loss limit, personal monthly loss limit, the amount bet, theoretical loss, and whether the players had increased their limits in the past. With the help of predictive analytics, players with a high likelihood of changing their limits can be proactively approached.