The strategic consulting and customised research firm MECN published its 2018 Spring Edition of its Online Gambling Quarterly report, revealing some of the most important trends, as well as financial, marketing, product and lottery analyses of the iGaming market of the first quarter of 2018.
The firm issued an extensive report about the current and future online gambling industry climate, as well as the company and product trends on the international iGaming market.
Business Climate in the Online Gambling Industry
The firm put the online gambling industry climate as a key part of its quarterly analyses, with the major aspects of the iGaming industry index being the industry’s development over time as well as a survey of the online gambling industry participants.
Current iGaming Industry Climate
According to analyses carried out by MECN, the majority of the experts who took part in the survey (a total of 61%) evaluated the current business climate of the industry as “satisfactory” (57%) or “poor” (4%). The rest of the surveyed participants said the online gambling industry climate was “good”.
As far as industry climate development is concerned, MECN analysts found that at the time when the previous survey was carried out (in December 2017), there was a promising increase of the “good” estimate to 46%, following a decline to 39% in September 2017. Unfortunately, the figures once again declined to 39% in March 2018.
Future Online Gaming Industry Climate
The research firm further provided a projection for future business situation of the online gambling industry covering the next twelve months. According to estimates, a total of 48% of the industry experts who participated in the survey estimated the online gambling industry climate as “good”, while 45% of them describing it as “satisfactory”. The number of experts who were likely to evaluate the future business situation as “poor” represented 7% of the participants.
In other words, the number of industry experts who believed that the industry climate will be “good” over the period of the upcoming twelve months, represented a 9% increase in comparison to the ones that currently described the iGaming industry situation as such.
Detailed Opinions about iGaming Market Climate
MECN analysts have also asked the iGaming industry experts to provide more detailed information and opinions about both the current and the future business climate of the sector. The arguments given by most experts were mainly in two directions, including the potential new markets and the possible regulatory changes which could expected in the months to come.
Possible Regulatory Changes in the Future
Most industry experts who provided more detailed information about the current and future business climate in the online gambling industry found that the current state of the sector was “satisfactory”. After analysis of the information available, it also turned out that most of them expected that the future climate of the business would be “satisfactory” or “good”. There were also some who believed that the iGambling industry climate would be “poor”.
Speaking of regulations, part of the industry experts said that the current satisfactory state of the sector was mostly due to the fact that many countries have gambling legislation and regulatory framework, and some are preparing to roll out such a framework. However, some specialists warned that “over-regulation and compliance issues” could result in causing a lot of problems when it comes to restructuring of gaming operators around the world, or could harm the markets’ ability to meet customers’ expectations.
According to some experts, the compliance regulations of the UK and the European Union (EU) could have massive negative effect not only on the domestic markets, but also on a global scale. On the other hand, the possible changes seen in countries such as Germany and Sweden could lead to a more positive market outlook.
Potential New Markets
When it comes to new markets’ expectations for the current and future business climate, most industry experts claimed that the existing state of the sector was satisfactory, and shared their expectations that it would remain good in the future.
Some analysts explained that the US Supreme Court’s ruling on New Jersey’s sports betting case would be a crucial part of the sector’s development. On the other hand, the expansion of the gambling market in some African countries could create new opportunities in the international gambling and sports betting sector. Still, there were some experts who raised red flag about the Africa’s gambling industry expansion, saying that it could bring much greater risk than benefits.
Responsible gambling was another aspect of the experts’ more detailed opinions, with some of them backing the idea that if operators start making larger investments in responsible gambling, the business would be in much better state than it is to date. According to them, General Data Protection Regulation (GDPR) and media and regulator scrutiny have massive impact on the companies’ marketing strategies.
Gambling Operators and Product Trends
MECN has also asked gambling market experts and insiders about the future prospects of the companies operating in the sector, the future product trends as well as about the regions with largest and smallest growth in terms of iGaming.
Companies’ Perspectives According to Experts
Experts who took part in MECN’s survey were asked to provide their estimates of the future global market share of the major companies which operate in the international online gambling market over the next 12 months.
The indisputable “winners” in the category were iGaming operators bet365, LeoVegas and Sky Bet, with the three of them pointed by market experts as the ones most likely to experience the largest market share growth in the next 12-month period. In fact, this is not the first time when LeoVegas and bet365 are put on top of the ranking, as the two operators were on the leading positions of the ranking for a number of quarters in the past. According to estimates, Sky Bet is third, with its expected market share growth being slightly behind the duo on top.
Most other companies in the ranking were put in the “average” market share growth sector, as their growth level was more or less the same as the one reached in the preceding quarter. Betway is the only exception here, with the company marking larger growth which put it among the top 10 operators.
Product Trends
The report of MECN also includes the potential for future growth of some major iGaming products over the next 12 months.
According to analysts, mobile betting is the indisputable leader of expected market growth in the next 12-month period. After marking a slight 4% decline in the third quarter of 2017 and another minor 0.3% decline over the last three months of 2017, it now marked a 5% increase in the growth estimates compared to the preceding quarter.
The other online gaming/gambling products which are expected to generate growth over the next 12 months are mobile casino and online/mobile lottery, both of which are expected to mark a 4% growth in the afore-mentioned period.
Despite the fact that Bitcoin business has marked a strong growth lately, the current estimates show expectations for a 5% decline in comparison to the result reached in the past quarter. This trend, however, came as a surprise to industry participants, as Bitcoin and blockchains have been among the hottest trends in the iGaming market lately.
Regional Focus
Market insiders also provided some information and opinions about the growth potential of certain regional markets. After being asked by MECN researchers and analysts, they provided some estimates about the German market, the African market and both about the Asian and US sectors.
According to gambling industry experts, German market had the smallest potential for further growth. In fact, it was ranked last in the survey held by MECN and this came as no surprise, especially due to the recent decision of local legislators to shut down online casinos in the country. This decision combined with increased regulatory scrutiny on gambling have influenced on the situation, with some large iGaming operators choosing to leave the online casino market of Germany.
The African market, on the other hand, was once again ranked pretty high in the regional growth estimates survey of MECN. As explained above, Africa was mentioned by a number of experts in terms of more detailed opinions and expectations about the current and future business climate. In addition, an increased number of gambling-related exhibitions and conferences targeting the African iGaming market have been seen lately.
As far as the Asian and US markets are concerned, experts have shared that these were the markets with largest prospects of future growth. Both regions, and especially the US, have seen increased experts’ growth estimates over the past couple of quarters.
- Author
Daniel Williams
