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The messages are going to be difficult to ignore. Almost every company in the gambling industry has launched a marketing offensive linked to the World Cup, which starts this weekend. The event represents a great opportunity to target the betting world's natural constituency of young male sports fans through smart tactical promotions.

But when football's big party is over, the challenge of building a credible position in this dynamic, fast-changing industry will remain. Only marketers with an eye on the long game will be around to enjoy the 2010 World Cup in South Africa.

The rewards for success are enormous - and getting bigger. The online gambling market is one of the fastest-growing UK business sectors. There has been a sevenfold increase in betting in the UK since 2001, and the industry now accounts for £50bn a year, or more than £800 a person, according to research from Nottingham Trent University.

This figure covers a multitude of gambling options now available to the British punter. The traditional high-street sports bookmakers, including Ladbrokes, William Hill and Coral, have seen their core market attacked from all sides, as lower operating costs have enabled online brands such as Betfair, Sportingbet and UKBetting to offer gamblers more attractive odds and gnaw away at the bookies' market share. Media owners including Channel 4 and Sky have also moved in to the market, albeit with mixed results.

Adding to the mix are the brash newcomers - the online poker rooms and casinos. When PartyGaming, the company behind the market-leading PartyPoker brand, floated last year, it turned its four founders, including marketing director Vikrant Bhargava, into overnight paper billionaires. The company was valued at £5bn, more than Marks & Spencer and British Airways combined.

PartyGaming turned over $978m (£519m) last year, up from $30m in 2002, while share price earnings climbed from $4.7m to $293m over the same period.

Bhargava recently announced that he will leave the business at the end of the year, and it is safe to assume that, when he does, he will be short of neither money nor job offers.

In PartyGaming's wake are about 200 other poker sites, with the biggest eight players sharing 95% of the market, according to analysts Christiansen Capital Advisors. Following Gibraltar-based PartyPoker are Israeli-owned PokerStars, Sportingbet's Paradise Poker brand, Ongame's PokerRoom and 888's Pacific Poker, along with brand extensions from Coral, Ladbrokes and William Hill.

Market sensitivity

The online casinos present a conundrum to the government. The global internet gambling industry is currently valued at $12bn (£6.4bn) by Christiansen Capital Advisors, and it is figures such as these that have turned the head of chancellor Gordon Brown. By regulating the UK online gaming market, the government stands to reap a tax bonanza, particularly at a time when the US government, which oversees the biggest gambling market in the world by far, is considering a ban on such websites on public welfare grounds.

This is a sensitive issue; last month gambling charity GamCare announced a 41.3% rise in the number of people seeking counselling for gambling addiction. In the face of protests, the UK government has shelved plans for eight super-casinos, now only allowing one. It has also made it clear that marketers operating in this complex setting must adhere to a strict list of dos and don'ts when considering how to spend their promotional budget.

Tessa Jowell, the minister for culture, media and sport, recently proposed rules for the industry to promote 'socially responsible gambling'. Her department is now in consultation with the Gambling Commission and the Broadcast Committee of Advertising Practice (BCAP), ahead of the Gambling Act coming into force in September 2007.

It remains a complicated area. Gambling and casino brands are currently banned from broadcast advertising, but can sponsor programming. Any advertising must not use offers of free money or lavish prizes to entice individuals to bet. Sports bookmakers, such as Ladbrokes, can advertise more freely, but not on TV - although, again, broadcast sponsorship is allowed.

The government has announced it will be lifting its ban on broadcast advertising for gambling brands next year. However, its ruling might mean future advertising by casinos, betting shops and internet poker sites will have to carry warnings about the dangers of gambling. Given these restrictions, albeit ones which are loosening, building a brand for an online gambling firm requires clear thinking. Questions abound: can you maintain an image of trust and credibility but still be exciting? Is it acceptable for children to be wearing football shirts with gambling brands printed across their chest? How can you advertise effectively without encouraging people to bet?

The key factor with any bookmaking business is trust and confidence.

The customer needs to know that the bookie or casino or betting exchange will pay out if he or she wins. Those best positioned to create this trust are the companies with a reassuring bricks-and-mortar presence on the high street. 'The product is the brand,' says David Briggs, managing director of Ladbrokes eGaming. 'You can spend a fortune on marketing, but in the end, if the customer is being ripped off and not treated with respect, they are not going to come back.'

Briggs emphasises the importance of product differentiation to long-term survival. 'In some sectors of the market, such as online casinos, you can bulldoze your way in with a huge marketing spend,' he says. 'But the conversion rates from doing this are not enough to sustain that strategy, particularly if you do not invest in the product and service as well.'

In a market where advertising legislation will play an increasingly significant part, Briggs feels the dynamic between online brands and their media partners is shifting. 'New entrants found plenty of media partners initially that would take their money and run with campaigns that, in my view, were hard to justify under existing legislation,' he says. 'That situation is changing now, and I think they will find it harder to get away with campaigns that break UK law.'

Customer recruitment

Operators are likely to find themselves hit financially by the new regulations, given that the return on a compliant ad is a great deal less than one offering free money or breaking the rules about enticing people to gamble online.

To counter this, Matt Jellicoe, European marketing director of Sportingbet, which also operates the Pacific Poker brand, says the firm wants to be seen as a mass-market entertainment brand rather than purely a gambling one. 'There is a strong focus on brand messaging rather than very aggressive promotional activity, which the legislator is much less keen on. Our marketing communications are those of a sports-based marketing company. But poker and casinos are very important to us.'

This is a neat approach that aims to put clear water between the company and specialist gaming brands including PartyGaming.com and 888.com.

For many brands, the appeal of the World Cup as a marketing vehicle lies as much in customer recruitment as any uplift in turnover. It is a chance to talk to the occasional big-event punter - people who are willing to bet on a major sports event but who wouldn't normally gamble. The UK is a more mature market than elsewhere in Europe, according to Jellicoe.

'Most people who want to bet are doing so, but the World Cup provides a great educational opportunity for us to talk to potential customers across Europe,' he says.

High visibility

Football remains a key marketing battlefield, particularly among gaming brands. Next season, at least three Premier League teams will be sponsored by online casinos: 888.com will continue its relationship with Middlesbrough, 23Red has bought the Aston Villa shirt, and online gambling group Mansion will sponsor Tottenham Hotspur. The latter deal is worth £34m over four years, making it one of the most lucrative in European football. Mansion previously came close to securing a £60m deal with Manchester United, but the club walked away, citing its unease at becoming associated with a gambling brand, and ultimately signed up with investment bank AIG.

Despite United's misgivings, sponsorship has emerged as a viable - and legal - marketing tool for gaming firms. 'We are trying to put more of a personality into our brand. People know it, but are not sure what is behind it,' says Itai Pazner, marketing director of 888.com, which sponsors the World Snooker Championships as well as Middlesbrough. He suggests both properties offer a way for the brand to connect with potential customers.

'From being an unknown brand three years ago (the Middlesbrough shirt sponsorship) has raised our profile considerably,' says Pazner. 'We have also taken ownership of the biggest event in snooker, and there are many similarities between the audience for snooker and the gaming market.'

Peter Marcus, a spokesman for the Intercasino Group, questions the longer-term benefit of shirt sponsorship as a strategy, claiming that the PR value derived by the likes of 888.com will be difficult for other brands to sustain. 'If you are the first it makes sense, but if everybody is sponsoring football teams the value will not be that great,' he says.

'There are a lot of poker rooms offering the same or very similar products,' adds Marcus. 'Positioning used to be about how much money you gave away.

That's difficult to sustain as a business'. He cites the media presentation of poker using lifestyle and aspiration as touch points. 'Look out for more tournaments in the Caribbean, more fashionable rooms populated by famous cool people.'

In such a complex and dynamic market where the barriers to communications are lowering, the premium on professional marketing experience is high, so it is not surprising that the recruitment sector has been quick to respond to the growth in the market. Dominic Quantrill, director of executive search agency United Media Entertainment, says that online gaming is an attractive sector for marketers who have a desire to work in a more entrepreneurial environment. Whether top marketing talent will make the move depends upon their capacity for risk. He believes that the spectre of the dotcom boom and subsequent bust hangs over the online gambling sector, deterring some candidates.

However, the pros are beginning to outweigh the cons. 'Salaries are not much different from the marketing mainstream,' says Quantrill. 'But in such a growth sector there are significant bonuses to be earned, and high performers are very well looked after in terms of share options'.

Those entering the high-risk, high-reward world of online gambling might do well to heed the old poker adage 'If you're at the table and you can't see the mug, it's you.'

ONLINE POKER'S BIG PLAYERS

PartyPoker.com Owned by the PartyGaming Group and founded in 2001 by Ruth Parasol, a former adult phoneline and website entrepreneur, and Anurag Dikshit. Floated on London Stock Exchange in June 2005 for £5bn, it has a 37% market share, according to Pokerlistings.com.

PokerStars.com Founded in 1999 and owned by the Scheinberg family, PokerStars is the world's second-biggest poker site. It has a market share of about 11% and is endorsed by former World Series of Poker champion Chris Moneymaker.

PokerRoom.com Founded in 1999 by Swedish students and professional poker players Oskar Hornell and Claes Lidell. Now a subsidiary of Betandwin.com Interactive Entertainment.

It employs more than 200 staff, 125 of whom are programmers, and has a 5% market share.

PacificPoker.com The poker room run by the 888.com brand is based in Gibraltar. It is expected to be the next in line for a stock market flotation, and has a 6% market share.

ParadisePoker.com Acquired by listed online gambling firm Sportingbet in October 2004 for just over £160m, ParadisePoker.com subsequently raised its valuation on the AIM exchange to more than £1bn. It has a 6% market share.

Source: PokerPulse and Pokerlistings.com