A report published in February 2023 analyzes the online gambling industry and predicts how it will develop.
Online gaming is one of the fastest-growing industries worldwide. The report published by Technavio estimated that the online gambling market is expected to grow by 11.03% at a compound annual growth rate (CAGR) for the period from 2022 to 2027. Essentially, the compound annual growth rate is a calculation of the average annual revenue growth between two given years, assuming that the growth in question occurs at an exponentially compounded rate. The market size is predicted to increase by $150.5 billion, a huge number that is expected to be reached in less than five years.
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About Technavio
Technavio is a technology, research, and consulting company on a global scale. The research and analysis of their experts are focused on trends that are yet to emerge in the market. They strive to provide adequate forecasts so as to help businesses to see the available market opportunities and based on them to develop effective market strategies to optimize their market positions and be competitive.
Technavio has over 500 proven analysts who are responsible for the company's report library, which contains over 17,000 reports related to 800 technologies across 50 countries. As for Technavio's customer base, it consists of companies of all sizes, over 100 of which are Fortune 500 enterprises. Technavio's clients fully trust their experts to carry out in-depth market research and forecasting over a period of time, the purpose of which is to identify the opportunities that existing and potential markets could offer, as well as to evaluate their market positions and competitiveness.
Research Methodology
The purpose of the research is to present a detailed picture of the market through a combination of research, synthesis, and summation of data from a variety of sources. The object of the research is the various aspects of the market, with the emphasis being placed on the identification of the key companies in the industry that have a significant impact on its development. The data provided in the report are the result of primary and secondary research.
Sources of Information
Technavio divides the sources used in the creation of the report into two main groups: primary sources and secondary sources. The first group includes sources whose information the team reaches on its own through interviews, for example. These are manufacturers and suppliers, channel partners, industry experts, as well as people who make strategic decisions. Secondary sources include information that is already available, that is, various documents and references. Technavio states that industry journals and periodicals, government data, financial reports of key industry players, historical data, and press releases were used.
Data Analysis
Two approaches were used for data analysis. The first approach is data synthesis, which involves collating the data, evaluating key figures, and then analyzing the insights identified. The second approach is data validation, which is done in three ways: checking against proprietary databases, triangulation with data models, validation through industry experts.
Writing the Report
The final part of creating a Technavio report is its writing, which is divided into two types: quantitative and qualitative. In the table, you can see what both types include.
| Qualitative | Quantitative |
|---|---|
| Market Drivers | Market Size & Forecast |
| Market Challenges | Market Segmentation |
| Market Trends | Geographical Insights |
| Five Forces Analysis | Competitive Landscape |
Online Gambling Market Under the Microscope
The global online gambling market is considered by Technavio as part of the global casino and gaming market within the overall global entertainment market. What will be the factors that will have a significant impact on it during the forecast period?
Key Drivers
One of the most influential factors is the growing demand for mobile gambling options. This is caused by the decreasing average selling price of smartphones, which in turn is the reason for the increase in sales. Mobile devices provide an intuitive user-friendly interface for gaming. It is a well-known fact that smartphone owners periodically engage with their phones for short to long periods of time. This, in addition to the many payment methods they support, makes them an increasingly preferred option due to the easy access they provide. Gambling sites either implement mobile optimization or develop separate dedicated applications.
Factors such as a demand for mobile gambling, growth of eSports, and relaxed government regulations regarding regulation have influenced the growing market.
Market Trends
One of the emerging trends in the market is the use of VR as a treatment method for gambling addiction. What does using VR help? Through them, people addicted to gambling find themselves in a safe virtual environment to satisfy their desire through subconscious deception, without actually allowing them to indulge in the unhealthy habit. In addition, with the help of VR, therapists can freely study the behaviour of addicts while practicing "virtual gambling" to discover the root of the problem, as well as monitor the progress of their clients.
Major Challenges
Despite the advancement of technology, the growth of the market has been slowed down due to the difficulty in ensuring the security of online data, which is proving to be one of the biggest challenges. There are many doggy gambling sites that lack transparency in how players' potential winnings are stolen and how and why their data is stored. In addition, such operators do not have established standards when it comes to casino games, which in turn reduces trust in all gambling service platforms. As a result, business scaling becomes impossible and new potential users lose the desire to play. An additional stumbling block for online gambling sites is that they have become a prime target for cyber attacks as they have a large resource in terms of personal data as well as finances.
Which Are the Biggest Online Gambling Companies
In order to improve their position in the market and strengthen their presence, online gaming companies apply different techniques. For example, strategic alliances and partnerships are concluded, mergers and acquisitions are carried out, various products and services are launched, and geographic expansion of sorts is carried out. The Technavio report includes detailed analyzes of the market's competitive environment and 15 vendors are scrutinized. In the list below, you can see which operators are included.
- 888 Holdings Plc
- Bet365 Group Ltd.
- BetOnline
- Camelot UK Lotteries Ltd.
- Entain Plc
- Flutter Entertainment Plc
- Fortuna Entertainment Group AS
- Galaxy Entertainment Group Ltd.
- INTRALOT SA
- Kindred Group Plc
- LeoVegas AB
- MGM Resorts International
- New York State Gaming Commission
- Scientific Games LLC
- Sportech Plc
The Fastest Growing Segment in the Online Gambling Market?
One of the most important questions that this report answers, and accordingly one of the most curious for players, is which segment of online gambling will be the fastest growing during the period 2023 - 2027. Considering the technological advancements, we are witnessing, you will be surprised to understand that it is predicted that this will be the desktop segment. The reason is that despite the convenience that mobile phones give us and through them we practically carry a small world everywhere with us, desktop devices offer a better experience because their screens are larger.
In 2017, the desktop segment was valued at $106.34 billion and will continue to grow until 2021. In addition, the majority of online gambling offers are web-based, which means that the desktop experience is much better and cannot be compared to this mobile device. The fact is that many gaming operators have optimized their sites for mobile devices or even gone as far as developing mobile applications, but gamblers still overwhelmingly prefer to play on desktop computers. This is also the reason why the desktop segment is predicted to grow during the forecast period.
Key Regions for the Online Gambling Market
The other relevant question that the Technavio report answers is what will be the key regions regarding the development of the online gaming market during the forecast period. According to experts, 39% of the market growth will be provided by the region called Asia-Pacific (APAC). As the name of the region suggests, this region is located along the western side of the Pacific Ocean and includes countries in East and Southeast Asia and Oceania. The other region expected to bring significant growth to the industry is North America.
The online gaming market in the New World is growing at a rapid pace that is directly proportional to the increase in mobile application platforms. Online gambling was launched by the providers who saw the opportunity on the one hand due to the rampant spread of smartphones and on the other hand due to the growth in the use of online gambling websites and applications. For example, in 2021, the state of New Jersey launched the first digital platform through which it is possible to buy lottery tickets from any type of device without the need to download a special application or deposit amounts. A similar thing happened in 2020 in Pennsylvania, only the platform was designed for sports betting.
But what is driving the wave of online casino usage? As with many other industries, the COVID-19 pandemic has caused a lot of changes. SARS-CoV-2 has seriously disrupted the rhythm of the gaming industry in North America. The pandemic has led to the closure of many brick-and-mortar casinos, prompting people to turn to online gambling opportunities, which has prompted legislative changes as well as technological improvements. As a result, more and more countries in the North American region are introducing regulations related to online gambling and its practice is slowly but surely increasing. As an illustration of this, experts from Technavio give as an example the growth of 69% in one year of sports betting in the USA, which, according to the American Gaming Association, in 2020 brought revenues of $1.5 billion.
Key Data of the Report
What are the main fields of study of the report? First of all, the compound annual growth rate (CAGR) of the online gambling market during the forecast period has been examined and analyzed. The factors that will influence the development of the industry worldwide are not only mentioned but discussed in detail so as to prove why they are believed to drive growth. An accurate assessment has been made of the size of the online gambling market as well as its contribution to the overall gambling industry. Detailed forecasts have been made of current trends as well as those likely to appear in the next few years in view of changes in consumer behavior and attitudes.
The growth of the industry in the key regions such as Asia Pacific, North America, and Europe is deciphered. In the list below, you can see their distribution, as well as which countries are primarily focused on.
- North America
- The USA
- Canada
- Europe
- The UK
- Germany
- France
- Rest of Europe
- Asia-Pacific (APAC)
- China
- India
- Middle East & Africa
- Saudi Arabia
- South Africa
- Rest of the Middle East & Africa
- South America
- Chile
- Brazil
- Argentina
Technavio’s experts perform a thorough analysis of the competitive environment of individual online gambling markets as well as the entire industry. Detailed information is provided on the leading suppliers for the respective markets to show why they occupy the leading positions. Last but not least, a comprehensive analysis of all the factors that will influence the market vendors and drive the growth of the online gambling industry has been done.
It is difficult to analyze such a fast-growing industry as online gambling. What remains to be predicted, not for one year, but for the next few years, bearing in mind that technologies are updated literally every day and online gaming operators strive to implement them as quickly as possible to facilitate their current customers and eventually to attract new ones, offering on good terms from the current customers. Well, the experts at Technavio manage to do just that. The report published in February 2023 examines the development of gambling on a global scale, highlighting certain countries that are expected to have a significant impact on the development of the industry for the period 2023 to 2027. Canada is one of these countries, and therefore it is recommended that every online casino Canada-based affiliate should read the report and familiarize itself with the forecasts made to assess whether its market strategy is in sync with the developing trends, as well as get ideas from companies operating in other regions of the world.
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Kayleigh reviews online casinos and sportsbooks while coordinating training initiatives for new recruits at Casimoose.ca. She excels at sharing her love for the iGaming industry and puts her past experience to good use. With a background working for the biggest gambling brands online and a strong analytical ability, Kayleigh developed a natural gift in breaking down each component of online casinos, betting sites as well as their offerings and hasn't looked back. Outside of Casimoose, she's a proud Ontarian with a love of sports and entertainment.