Gambling is one of the oldest pastimes known to mankind, with evidence pointing to the fact that the activity was heavily regulated within both the Roman Empire and Ancient China. However, gambling has come a long way since then. In recent years, it has gone from strength to strength, often accelerating far faster than the rest of the economy.
This was especially noticeable during the 2008-09 financial crash, when gambling stayed strong despite the fact that almost all other industries were floundering. With coronavirus causing a similar economic crisis in 2023, has the gambling sector managed to repeat the trick again?
The introduction of lockdown measures in Britain at the end of March hit all kinds of sectors hard, but especially those which rely on brick-and-mortar stores for their businesses. Hospitality, retail and fitness were among those to feel the snap most keenly – but the gambling industry also suffered.
Given that retail gambling venues contribute 50% of the overall market in the UK (excluding the revenue generated by lotteries), it’s unsurprising that activity fell away. Online gambling did not, as might have been expected, initially compensate for this loss, with only 0.4% of surveyed adults saying they had started gambling during the month of May.
A similar trend was witnessed across the rest of the world. The USA suffered more than most, given that online gambling is largely illegal in the country and the American industry relies primarily on its glitzy gaming epicentres, such as Las Vegas and Reno. With land-based casinos forced to close their doors for much of the year, the sector took a nosedive in its turnover.
Sport brings a lifeline
However, the return of elite level sport gave the flagging industry a much-needed lifeline. Football is one of the most common sports upon which people lay bets and as such, its postponement during the earlier part of the year meant that levels of gambling (both online and offline) dropped quite significantly.
The Bundesliga in Germany was the first top-level league to return in mid-May. That event was marked by a 13% upturn in gambling across the UK, showing just how important sport is to the sector. By the time the Premier League returned in June, sports betting participation had bounced back to something resembling its normal levels.
Again, this resilience was experienced most noticeably in the countries where sports betting is not outlawed, including the UK, South Africa and the Philippines, among others. Major players in the industry such as the USA, China, India and much of South America have significant restrictions in place on this type of gambling.
iGaming on the increase globally
While there might not have been a huge increase in online gamblers in the UK, that trend does not appear to have been replicated across the globe. Indeed, emerging markets in countries such as Germany, Poland, Sweden and throughout North America boosted iGaming’s economic profile at the end of 2019.
That surge is expected to continue into 2023, given that the sector is projected to enjoy a double-digit compound annual growth rate (CAGR) of an impressive 13.2% this year. While many people had already predicted that the CAGR would continue to develop in the iGaming sector in 2023, it’s likely that the restrictions imposed by coronavirus lockdown measures have only enhanced it.
That’s probably true going forwards, too. The digital transformation has affected all facets of our life, from business to labour to social interactions to e-commerce. It’s only logical that as the number of online casinos and the trust placed in them by the consumer increase in tandem, so too will the amount of people who prefer to gamble from the safety and comfort of their own home.
The UK still leads the way
Despite the fact that Las Vegas in the USA is often seen as the home of gambling, Great Britain has long been the forerunner when it comes to the online industry. That’s because of the relatively lax regulations surrounding UK casinos such as stsbet.co.uk in comparison to those based in the USA or elsewhere in the world.
With ample opportunity to bet online, and with a wide variety of different formats that those bets can take (sports betting, slots and table games, to name but a few), it’s no surprise that Britain leads the way. For example, the year ending March 2023 (the latest date for which statistics are available) showed that the UK recorded a gross gambling yield of £14.2 billion.
While that figure does not, of course, take into account the worst effects of coronavirus on the industry, those effects are likely to be felt around the world. What’s more, with the UK recording an increase of 8.7% in remote (or online) GGY during the period, it looks secure in its position as top of the pile globally going forwards.
Those in the know have suggested that while 2023 may have been a difficult year for the gambling industry in some respects, it’s only likely to continue to flourish going forwards. However, that prognosis can’t be applied with equal confidence across all facets of the sector, since it seems inevitable that customers will migrate from land-based casinos to their online equivalents.
This will be precipitated in part due to the digital transformation taking the whole world by storm, but also encouraged by new advances in technology. The incorporation of exciting new ideas such as virtual reality (VR), augmented reality (AR), facial and vocal recognition and enhanced graphics are going to make the online experience an ever more immersive, interactive and enjoyable one for gamblers in the future.
How will this impact the industry as a whole? Well, countries such as the USA which depend upon land-based casinos for the lion’s share of their revenue will likely be forced to adapt their legislation or else fall away completely. Something similar could happen in China, too, where the so-called “Asian Las Vegas” city of Macau brings in most of China’s earnings with regard to the gambling industry. In that sense, 2023 and beyond could prompt a “survival of the fittest” when it comes to 21st century gambling, with only those canny enough to adapt to market trends coming out on top.