Will Online Casinos Remain Popular Once Covid-19 Has Been Reined In?
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There’s no doubt that on a personal level, the COVID-19 pandemic has been a disaster for pretty much everyone.
However, from a business perspective, there are those who – while not crowing from the rooftops about it – have enjoyed significant success during these turbulent times.
Ask the shareholders in Amazon, Netflix, Etsy and Tesla how they have found the pandemic, and from an investment perspective, they will be delighted with how things have panned out in the past 18 months or so.
Ask a , and if they bought in early enough, they might just reply to you from their private yacht in Monte Carlo.
Another sector that has enjoyed an increase in activity is online casino gaming, which has been able to take advantage of several converging trends to flourish.
The perfect storm
Two patterns have led to a stellar year for the online casino industry.
Firstly, many of the land-based casinos have now been shut entirely – or open with a limited capacity – for more than a year. So, while demand for games such as roulette, blackjack and slots remains strong, the supply has diminished accordingly due to international restrictions.
As a consequence, the online casinos in Canada and beyond have filled the void, and their customer bases have grown exponentially. The fact that many casino sites also offer sports betting – a discussion point currently passing through the Canadian Senate – meant that they also saw an increase in revenue from that particular stream, with physical sportsbooks shut for large swathes of 2020 and into this year.
Then there’s the other factor. People have simply had more leisure time available to them – bars have been shut, restaurants have been off the menu, cinemas have been closed, and sports teams have largely been playing behind closed doors.
The upshot is that folks have spent more time at home with more disposable income in hand, and with super-fast broadband internet more readily available – as well as affordable contracts for high-end smartphones and tablets – it’s no wonder that online gaming has flourished.
The numbers speak for themselves, and data published by the UK Gambling Commission for the period March 2020 – the nominal start of the pandemic – to October of the same year shows how operators have benefited markedly from the ‘stay at home’ lockdown culture that has pervaded.
However, as the Western world creeps back towards normality, the question is, how long can the online sector continue to dominate?
On the comeback trail
Slowly but surely, land-based casinos in North America have started to open their doors again.
The Las Vegas Strip, while not the completely chaotic combination of good times and exuberance that it used to be, is seeing more and more people return to its neon lights.
The overall picture is strong, with the American Gaming Association reporting that Q1 2021 equalled the best ever three-month stretch that the industry has ever seen.
More than US$11bn filled the coffers of venues shorn of customers in the prior year or so, and it’s this cash injection that ensures that physical casino brands will soon bounce back from the doldrums.
Remember also that those revenues were generated from a limited customer base – in fact, many leading casinos are only allowed to admit as little as 50% of their standard capacity due to local restrictions.
Some economists have predicted a boom in post-pandemic spending, and it appears as if the land-based casino sector – plus its associated gains in hospitality, travel and tourism – has already begun to enjoy the fruits of that demand.
What happens next?
The future success of the online casino sector in a world in which COVID-19 is under control will be determined by several factors.
Firstly, how well will the leading brands be able to retain the new and existing customers they have picked up during the pandemic?
To do so, they will need to offer a platform that rivals both land-based casinos and other leisure pursuits to retain the interest of their players. They can do this by offering the hottest new game releases, but more likely is that the number of bonuses and promotions that are available will go into overdrive – as will loyalty-style schemes that essentially reward players for the amount of time they spend on a site.
They will also need to consider who the new customers are that have come on board. Are they seasoned casino veterans who simply want to enjoy their favourite games no matter what the medium, or are they casual players who are simply looking for fun ways to spend their time during lockdown?
Identifying the demographics and interests of their new customers will determine how online casinos go about their business from here.
Another key question to be considered is, how long will it take for people to resume their old habits and interests after the pandemic has been downgraded? For some, the transition back to travelling, socializing and enjoying their favourite pursuits will be seamless.
For others, however, you suspect that there might be some reticence about returning to the good old days – the fear of catching COVID-19, and the long-term strength of the vaccine may just be enough to change the habits of some for a long time to come.
Of course, the land-based casino sector relies heavily on tourism and hospitality to thrive. In 2019, the last non-COVID year, some 42 million people descended on Las Vegas from all over the globe. What percentage of that mass will return even after international travel restrictions have been lifted?
Even after many of the pandemic restrictions have been lifted, life may not return to normal – in the hearts and minds of people, as much as anything else – for quite some time. As such, the online sector can certainly take a chunk out of a land-based industry that relies upon the gregariousness of its customers to thrive.
