In an age where everything is going online and digital, you might wonder about the growth prospects of the UK iGaming business. Online casino gaming has picked up tremendously over the past decade, and this has only been exacerbated by the recent public health crisis which closed many UK land casinos and betting shops.
Is an investment in iGaming worth it? And what are your options if you do want some exposure?
iGaming in the UK – A High-Growth Sector
According to the latest statistics from the UK Gambling Commission, which compiles stats from the legal UK gambling industry every year, we can learn the following.
- The number of betting shops in the UK is on the decline. As of March 2020, there were 7.7% fewer betting shops in Great Britain than in March 2019.
- The Gross Gaming Yield from physical gaming machines in the UK dropped 25.6% in the same year.
- The Gross Gaming Yield for non-remote casinos dropped 4% in the 2019-2020 year.
So, what’s causing this rapid decline in land-based UK gambling? Are UK punters simply kicking the habit? Not quite. Digging deeper into the report we can see:
- The Gross Gaming Yield for the remote betting, bingo, and casino sector increased by 8.1% in the same year. £5.7 billion was wagered online in 2019-2020.
It’s clearly obvious that casino players, sports bettors, and bingo fans are migrating to real money online casinos and betting sites and leaving the bookmakers shops and bingo halls behind. We can expect this trend to pick up pace as a generational shift takes place as baby boomers pass the flame to millennials and zoomers. Younger generations, most of whom are considered “digital natives,” show a strong preference for playing online.
From a business and investing point of view, iGaming looks promising. Any industry growing at 8.1% annually is clearly worth investing in, and that’s before we take into account the 2020-2021 numbers and the mass migration online that happened during this fiscal year. We’ll have to wait for the UKGC to compile those stats to see how that went.
How to Get Exposure to the Booming UK iGaming Sector
There are three primary ways to invest in UK iGaming. Which strategies suit you will depend on your desired level of involvement.
- Gambling Shares – You can easily buy shares in major UK gambling companies such as Flutter Entertainment, William Hill, and gaming companies like Playtech. These companies are leaders in the industry. This would be the most passive form of investing in UK gambling.
- Affiliate Marketing – Another option would be to promote UK gambling sites through your own website. This allows you to profit from revenue share models. For example, if you send qualified leads to a UK casino, you might get up to 30% of all profits that player delivers to the casino over their lifetime as a player.
- White Label Sites – Companies like White Hat Gaming offer bespoke online casino solutions and manage them for you. These out of the box online casinos are popular with investors who want to own an online casino but don’t want to manage one. Expect to invest around £10,000 to get started.
Report Summary
Clearly, the UK iGaming business is booming. There’s never been a better time to get exposure to this growing industry. As long as it fits with your investment goals, risk appetite, and long-term strategies, it’s a sector well worth looking closer at.