Pulse
A wakeup call for sportsbooks
By Lewis - 27 July 2020
After months of lockdown and an unprecedented real sports void, Martin Wachter, CEO & Founder of Golden Race, believes the betting industry is beginning to see the light at the end of the tunnel and that now is a moment to recover and put the learnt lessons into practice.
The lack of sports events, closure of retail shops in several countries and restrictions in many others has seen the betting landscape over the last three months look quite hard.
Thankfully, the industry has had some help to recover from the revenue drops: virtual sports have boosted the industry during those weeks, making online platforms grow and contributing to the economic viability of the year. It is true that virtual sports have been exponentially growing during recent years thanks to the several advantages they possess that gamblers appreciate, particularly the possibilities brought by improved technology bringing increasingly realistic games.
Even before the COVID-19 outbreak, it is estimated that 15 to 20 per cent of the monthly profits had been generated by virtual sports at European betting shops, with bigger percentages in other markets such as Africa and Latin America. But their increase during the outbreak has been surprising. Virtual sports have been attracting great deal of attention from many iGaming executives over the past months, as operators looked to counteract the widespread cancellation of live sports events.
Having a look at the online casinos, virtual sports players are the one with the biggest increase during March and we observed a 74 per cent growth on Golden Race online tickets selling during the same month.
So, how should the industry respond?
It seems clear that virtual sports have not been just a quick solution for helping the betting industry during this pandemic, but a powerful resource to complete bookmakers and operators’ product offers. This ‘alternative’ is no longer an alternative. Virtual sports are a very useful tool for helping betting businesses earn more income in a continuous way, especially in terms of covering costs and saving the year when real sports have not been available.
The greatest strength of virtual sports is their availability around-the-clock. Injuries, bad weather, suspensions, or virus outbreaks do not stop virtual sports from reaching your platform and customers.
We will have to wait and see what most live sports bettors are going to do. However, I am sure that many punters who had not try virtual sports before may feel tempted from now on not just to play when there is little live action, but also in the gaps between the live action, making bookmakers embrace virtual sports as a permanent option in their portfolios to add incremental revenue to their betting businesses on a long-term basis.
Taking the opportunity that operators have kept on hold, such as incorporating the digital channels to the retail businesses strategies, could also be a way to diversify the type of client, reach new targets and, ultimately, earn more money. Almost every land-based casino company in the world was thinking about expanding their operations to the digital channels before the pandemic.
Some experts say offline to online is a natural migration due to the increasing use of the internet and mobile devices alongside the necessity of improving cost-efficiency that this pandemic has left in several industries, including ours. But it is not only this year that the land-based gambling gross win is forecasted to fall; according to some sources, last year, prior to the pandemic, was also a year of decline for this part of our industry.
Bookmakers should take advantage of virtual sports, as this is something that can be done the whole year. They know this well in Italy, one of the most developed virtual sports markets, where operators and bookmakers have seized the advantages of virtual sports since 2015 to see outstanding results at the end of each year. Golden Race virtual sports have been doing more than six per cent of the whole betting volume of the retail business in Italy since 2018 – a huge amount to show just how important virtual sports can be.
Another case study would be Africa, a huge continent, and the strongest market regarding virtual sports. There are countries such as Nigeria where nowadays betting operators open a betting shop to have virtual sports, and not the other way around. Many sports betting operators in Africa are doing 70 per cent of their whole traffic in virtuals.
Staying updated about virtual sports’ latest trends and always having the best options for customers, like an improved technology, innovative games and new betting options, every company will be able to obtain the maximum performance from Virtual Sports, having great results at the end of each quarter.
We will need to wait and see how different markets regulate this vertical, as legislation is a to-do in many jurisdictions around the world that our sector must accomplish. We will also have to see how bookmakers and operators who used to work just with real sports adapt to this new-for-them offer. But there is so much potential around virtual sports.
Virtual sports are here to stay and will make the difference very soon.
Martin Wachter is the CEO & Founder of Golden Race, developer and provider of virtual sports and betting solutions. Golden Race generates more than 15 million tickets per day through major online and retail partners around the world on a regular basis. Wachter founded Golden Race in 2006 and has 20 years of experience in the betting industry.
