Effects From Covid-19 On The Online Gambling Industry

As the Covid-19 pandemic ‘simmers’ down, we finally get a better picture of the effect it had on online gambling.

The Global Impact of Covid-19

It is very difficult to fully picture the extent of the damage that the Covid-19 pandemic did throughout the world. Even online gambling feels the effects of Covid-19. So, it definitely can be even harder to grasp this new reality and just act as nothing has happened. That is simply because it isn’t that easy to forget all the things that transpired in the past year or so. For many people, 2020 is simply a year to forget. That is for the majority of the population, who are not as fortunate as certain CEO’s to quadruple their fortune during the pandemic.

However, most of us were facing the uncertainty of the masked life on a daily basis. Especially with the number of businesses and small companies shutting down every week or so. This resulted in leaving millions, if not billions of people on the streets. And for that matter, we can point out that the gambling world definitely took a serious blow. In addition to several other sectors as well.

Areas such as tourism, the entertainment industry and both public and private transportation all suffered the same fate. It is not until recently that we were able to reflect and really assess the situation. And even now that can be a challenge. Especially since despite that drop in numbers, we are still not fully in the clear. Yet, at least now things are loosening up and we can assess the situation more transparently and in detail.

Online Gambling During The Pandemic

As you can assume by the title, our focus this time is strictly on online gambling. More specifically, we will take a closer look at how much the virus influenced the industry, and to what extent. Also, we will see how the gambling affiliated departments dealt with the challenges of the pandemic as well. Specifically, how they did in comparison to online gambling.

If you take a look in detail into the igaming industry, it is clear from the start that online casinos are actually not doing so bad. Especially if we compare them with the revenue from restaurants or hotels, for that matter. Then it is even more evident that online gambling fairs well during the Covid-19 pandemic. Understandably, the lock-down is playing a key part in the contrast of these numbers. And with online casinos having the luxury to deal with ‘virtual’ customers, the advantage is more than alarming. A perfect example is land-based casinos. They, just like land-based betting providers, are definitely among the most affected. So it is only natural to assume that the vast majority of land casino enthusiasts will use the perks of online casinos, and make the switch.

The Switch

This turned to be absolutely true. In fact, so much that it ‘ignited’ more aggressive gambling campaigns throughout the globe. Consequently, many world governments even took legal actions to limit, and in some cases to outright ban gambling advertisements altogether.

Independent researchers have noticed an increase in gambling traffic, from online casinos for about 15%. This co-relates perfectly after the year-end reports in March and April which showed online casinos set new records revenue-wise. Naturally, such interest is begging for strict gambling regulations, regardless of the country. Even more so with all those black market operators lurking on the internet.

Moreover, the quality and quantity of the traffic and revenue from online gambling vary from country to country. It mostly depends on several factors, such as the state laws for gambling, or the current financial situation. From here, looking at the numbers there are quite a few countries that did very well and managed to net some serious revenue. That is the gambling providers in the said countries. Below you can take a look at what those countries are.

  • USA
  • Spain
  • India
  • Italy
  • Georgia
  • Belarus
  • Philippines
  • Russia
  • Ukraine

Consequently, there are countries such as Austria and Latvia that definitely are taking a different approach. Specifically, the government of Latvia, going as far as to practically declare a war on online gambling. It is safe to say that the aggressive marketing approach does not work everywhere, nor it should. Especially since many studies are showing that online slots are proven to be more addictive than sports betting for example. And that is, even more, the case if the person is making a switch from sports betting or land casinos as we discussed earlier.

The Swedish Study

In order to prove the incline of online gambling during the Covid-19 pandemic, one Swedish study displayed very intriguing results. They conducted an experiment where they examined hard-core online gamblers. And when we say hard-core, we mean exactly that. The only condition in order to participate in the study was to answer the following question: ‘ If you think about the past 12 months, how often have you gambled on sports betting or online casino games? ‘. Then answer options were: ‘ I don’t gamble on online casino games or sports betting, ‘1-4, 5-9 or +10 times’. Everyone answering 10 plus times, was further considered for the study. Meaning that we are talking about the most severe type of players.

Moreover, the select few who were chosen were asked if they were gambling in the past 30 days, or if not, at any point during the past year. Eventually, the results from persons who were gambling in the past 30 days were then compared with those who did not gamble in the past 30 days. B. Note that the players were asked about several gambling sectors such as:

  • Online casinos & Land-based Casinos
  • Land-based Slots
  • Online & Land-based Horse Racing
  • Video Games Gambling
  • Online Bingo
  • Online Poker & Land-based Poker

Furthermore, in order to measure Problem Gambling Severity, the study is taking into account many different factors. The gambling behaviour (whether it is a no-risk player or a high-risk type of player), both gender and age, living situation(whether the subject is single or in a relationship, or has children) and finally occupation. Consequently, using chi-square analysis, the numbers said the following.

Out of 100%, 75% of the subject were men. With the majority working or being retired. Out of these 75, 7% reported self-exclusion from gambling via Spelpaus, Sweden’s self-exclusion program which is under the authority of Spelinspektionen. That is the official Swedish gambling regulator. For that matter take a look at the percentage of the risk factor of the subjects in this study:

  • 10% High
  • 15% Moderate Risk
  • 25% Low Risk
  • 52% No Risk

The percentage ratio for different gambling sectors for past-year gamblers, who also gambled in the past 30 days, is as it follows:

  • 26% Land-Based Casino games
  • 42% Land-Based Horse gambling
  • 46% Electronic Gambling machines
  • 56% Non-Live Sports Betting
  • 58% Live Betting
  • 72% Online Bingo
  • 74% Online Poker
  • 81% Online Casinos
  • 86% Video Games Gambling
  • 90% Online Horse Betting

What is even more interesting is that according to the study, gamblers who have been sports betting in the past 30 days, are more likely to report online casino gambling during the same period. So, according to this Swedish study, online casinos are definitely not as affected as their land-based counterparts. The convenience and safety that online gambling solutions provide are really hard to match when it comes to a dire situation such as the Covid-19 pandemic.

Online Businesses Strive

This brings us to our next point. And that is that it definitely pays off to provide online services of any kind, period. Especially during a situation such as this one. It seems like regardless of what sort of entertainment is at disposal, it is very likely to explode as long as it is online and it is well promoted. Netflix for one made a fortune, Amazon too, online gaming platforms, as well as apps are also setting revenue records. We even have the current crypto-craze, which is a whole different subject of its own. But, regardless it serves as a reminder that we are heading into an online world. So take a look at some of the industries which are similar to online casinos in the way of work, meaning offering their services via the internet:

  • Cryptocurrencies
  • Streaming Platforms
  • Online Games
  • Online Gambling
  • Dating Platforms
  • Adult Industry
  • Online Shopping
  • Online Courses

It is good to notice that cryptocurrencies are definitely working in favour for online casinos. That is due to the fact that many casinos operate fully on crypto, or have it as an option, thus making for some of the most convenient and secure transfers possible. Also, it is a perfect opportunity to deal with crypto in real life, in a regulated environment. Something that most crypto-gamblers tend to pursue.

Final Thoughts

Online gambling is definitely one of the biggest benefactors from the Covid-19. On the other hand, there are many online casinos and gambling providers who beg to differ. Many had to ‘close shop’ because of the pandemic. Many small-income casinos were struggling to keep ends meet even without a crisis, and the virus served as the final nail in the coffin. That isn’t to say that that is the sole purpose for the demise of these casinos. Specifically, if you take into account poor management, lack of innovation and entertainment, poor customer service… The list can be quite long. It is very easy to get complacent in our industry. Hence, many providers pay dearly for failing to keep a straight house even in normal circumstances, yet along now.

However, that is not to say that it does not come as a tragedy. Simply because of the employees, who are usually more affected than the owners. Which is the case 90% of the time. Consequently, we are firm believers that everything happens for a reason. Hence, this is a perfect opportunity for many to reconsider their approach. To implement useful innovations and try to improve every single thing about their business. We should always learn from our mistakes, and turn that negative experience into the driving force to conquer everything. For that matter, we cannot wait to see everything back to normal and everyone out on the streets.

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