The casino and online gambling markets are forecasted to grow at a CAGR of more than 11 percent between 2021 and 2026. During the lockdowns necessitated by the COVID-19 pandemic, more consumers resorted to online platforms to overcome the psychological, social, and financial crisis.
Recent research indicates consumer interest in online casinos and gambling due to the sports restrictions because of lockdowns. Also, some industry players went digital in reaction to the closure of gambling establishments. This has positively impacted the market since many players increased their online gambling stakes.
What does the future of the online gambling sector look like? Online gambling is forecasted to be the fastest-growing segment in the medium term. Machine learning, chat bots, and artificial intelligence have already carved a niche for themselves in the market.
During the forecast period, online gambling will be enhanced by cashless payment modes’ convenience and increased female players in casinos. What is the current casino and online gambling market size?
Online Gambling Market Size
In 2015, the online gambling market had a compound annual growth rate of 13.7 percent. Its market size grew to a valuation of almost $76.8 billion in 2020. This is expected to grow at 10.7 percent per annum to $127.4 billion by 2025. From 2025, the market size is projected to reach $192.2 billion in 2030 at a compound annual growth rate of 8.6 percent.
The historic period of growth is facilitated by increased adoption of smartphones with better internet accessibility, growth in disposable income, the emergence of digital payment modes, and economic rise in emerging markets.
The rise in gamer involvement is poised to drive future growth, acceptance, and incorporation of fintech. It will shift consumer gambling preferences, gambling legalization, and technical advancement of gambling platforms.
However, factors such as global recession, restrictions meant to mitigate gambling addiction, security issues, and demographic shifts could hinder the future expansion of the casino and online gambling sector.
Rising Player Involvement
Since the pandemic lockdown, there has been a global increase in the number of gamers on online gambling and casino platforms. The closure of traditional gambling establishments led to increased online gambling platforms like Xl-Bet, one of the best-rated betting sites in 2022.
All fronts saw an increase in internet traffic since people were obliged to stay indoors. Therefore, more people registered as new users and regularly logged into online gambling sites.
Some countries took the opportunity to modify their gambling regulations. For instance, online casinos became legal in Belarus while Armenia amended her existing laws. Also, many platforms improved their promotional events and marketing strategies to attract new players by increasing tournaments and paying higher bonuses. Some platforms even offer reload bonuses, registration bonuses, and loyalty rewards to attract more users.
Online Gambling Market Restraints
The global economic recession after the COVID-19 pandemic is projected to hinder the expansion of the casino and online gambling market during the forecast duration. During the lockdowns implemented by authorities worldwide, most businesses temporarily stopped their operations, resulting in substantial economic losses. Unfortunately, the casino industry wasn’t spared.
The global economy came to a standstill and plunged into a recession. The United Nations World Economic Situation and Prospects (WESP) estimates that the global economy shed an output of almost $8.5 trillion two years after the pandemic. This wiped out almost the entire strides made in the previous four years and pushed nearly 34.3 million people below the abject poverty line.
This means that people may not be ready to spend on non-essential activities like online betting due to the fall in disposable income. This will be a significant impediment to the increase of the online betting market in the forecast duration.
Online Gambling Market Trends
- Incorporation of Artificial Intelligence in Online Gambling
Most stakeholders in the gambling industry are resorting to AI (artificial intelligence) to enhance their customers’ overall experience. Therefore, the question ‘what are the benefits of artificial intelligence?’ is essential.
AI promotes personalized experiences for every user since it analyzes their betting preferences. It factors player needs regarding game selection and creates an appropriate and unique welcome page.
This minimizes the time wasted by users when searching for their favorite games among the numerous options on offer. Also, chatbots supported by artificial intelligence provide customer support and automatically resolve queries.
Artificial intelligence alleviates fraud and locks out scammers. It checks for gaming frauds and behavior patterns. Some gambling software development companies have recently launched an AI tool to record a gamer’s digital trail, highlight high-risk players, and improve user experience (UX). The software can identify irresponsible playing patterns through complex neural networks and algorithms in real-time.
- The Use of Blockchain in Online Gambling
There is an increase in the number of blockchain technology applications in the online gambling market. Incorporating the technology for payment transactions is one example of such a case. Blockchain is a safer and quicker payment mode than other options because it pays out in smart contracts.
The incorporation of cryptocurrencies has enhanced the speed of transactions and improved anonymity. Apart from protecting user data, it also minimizes the risks of hacking and identity theft.
Blockchain removes the obligation to provide sensitive information like banking and personal details when a player makes a deposit. Since the transactions are not taxed, blockchain transactions are cheap or free. Most online casinos are opting for crypto as a preferred payment mode due to its benefits to players, such as improved odds and significantly higher payouts.
- North America is Still the Fastest-growing Region
The current online gambling regulations in the United States only allow licensed bookmakers in New Jersey, Pennsylvania, and Nevada to conduct their business legally. Online gambling is regulated in the three states. However, new regulations in Pennsylvania allow online poker, online casinos, sports betting, and other games. There are several live sports betting applications in New Jersey and sportsbooks.
Canada remains a mostly unregulated territory regarding online gambling. On the other hand, Mexico aims to regulate the online gambling sector by amending its existing gambling laws.