Impact of Coronavirus on the Gambling Industry
Since the outbreak of coronavirus in 2019, it has spread from China to many countries across the world. The disease has caused thousands of deaths and has slowed economic progress across the globe. One of the widely affected industries is the gambling industry.
For example, in South Africa, there were mixed results on the impact of the novel coronavirus in 2020. While casinos continued generating most of the gambling industry’s revenue, its market share reduced, and the betting and limited payout machines became more popular.
Also, online gambling is becoming more popular than in-ground casinos and other betting platforms. You will now find more online casino ratings than ever before due to the increasing number of players regarding Smartcasinoguide co-founder Zigmas Pekarskas. And though casinos were the highest generators of revenue, it could not beat the National Lottery as it had the highest number of players.
In the US also, there have been many uncertainties like layoffs due to coronavirus. But most consumers still rely on retail therapy to deal with stress. As experts in the gambling industry, we have reviewed the impacts (both negative and positive) which coronavirus has brought to the gambling industry.
Top 5 effects of Coronavirus on the gambling industry:
- Increase in gamblers wagering on online games
Ever since coronavirus started in China and spread to Europe and other continents, there has been a reduction in the number of players wagering on in-sportsbooks. Also, since most live events have been canceled, it has been impossible for them to bet on these games. For example, in South Africa, sports and horse racing events have been canceled since the coronavirus outbreak. In this same country, though the traditional gambling industry is experiencing many losses, it has been a season of boom for the online casinos who have been reporting increased activity as the lockdown is extended, and more people fall into the financial crisis. Most people, therefore, are looking for ways of making some money to help them buy the essential services.
In the US, online gambling is also weathering the pandemic well than the traditional gambling operators who are severely affected by coronavirus. Online gambling is expecting less financial damage than most industries, and analysts predict that online gambling sites will reach a value of $102.9 billion by 2025. But most players who also gamble on these sites do not expect to receive payments via checks. Therefore, online gambling operators are aware of these customer expectations, and most online casinos offer the player multiple disbursement options to suit their needs. They have also enhanced their security and now process the payments even faster than before; these two components are critical now that many players are betting online due to coronavirus.
- Postponement or canceling of events
The coronavirus pandemic is already sweeping through the sports industry, and many games have now been postponed or canceled after its outbreak. And for postponed matches, the date which they will be held remains uncertain. The most significant event to be delayed was the Tokyo 2020 Olympics, which was to take place this summer in Japan. The event will now take place from July to August 2021.
Also, in South Korea, the football league finally started on May 8 after it was postponed for several weeks. And in Germany, Bundesliga premier league resumed on May 16 after being postponed. On the other hand, the English Premier League will continue in June after it was suspended for almost three months. Most betting operators rely on these games to be played for players to bet on them. And so when they’re unavailable, then they reduce betting opportunities for players leading to less revenue.
- Decrease in revenue or closing of traditional betting operators
Many traditional betting operators have been getting lower revenues and lower sports betting activity since the outbreak of coronavirus. Some states have also been closing mortar and brick casinos, making it harder for them to generate revenue. For instance, on March 16, New Jersey issued orders for closing the traditional casinos.
The traditional casinos in Pennsylvania also reported a decline in revenue from $67.5 million in 2019 to $50.5 million in 2020. New Jersey and Pennsylvania are the two states generating some of the highest income in the online betting field. Considering the online gambling industry is not doing badly, it means the general gambling industry will perform well because of it.
The Australian Gambling industry has also not been immune to Covid-19 effects. Many casinos and sports venues have been closed, and most players are now turning to online gambling. But the online gambling industry has also not been safe from the purge as there are very few sports and racing events which leave them in a position where the element that forms the basis of their services doesn’t exist anymore. However, the effect is not the same across the gambling sector.
- Increase in the use of mobile wallets
Before the novel coronavirus hit the world, most casino operators relied on other ways of disbursing money to their players. But since the epidemic started, more focus has been on the mobile wallets since they offer fast disbursement to the winners.
But the US gambling market has some challenges; At the same time, mobile wallets are way quicker than banks, casinos must obtain state and federal regulators’ approval before they create software for implementing them. Also, the laws for each state vary especially the taxes on bets and payments, which makes it hard for an online betting operator to operate nationally.
As time goes by, online casinos and regulators should focus more on the trends in consumer behavior and gambling as the country advises people to adhere to stay-at-home directives. Experts are projecting that the online casino industry will be worth over $81 billion; hence the more reason gambling enthusiasts should work on instant disbursements to chip away the support of other gambling industries.
From our research, we found out that the gambling industry has been badly affected by coronavirus. Traditional betting operators have been the most affected, with some online gambling sites chipping away most of their customers. But sports which form the primary basis of gambling have been threatened by the coronavirus pandemic leading to a paralysis of activities. The various gambling industry stakeholders should therefore find ways of mitigating the effects of the virus.