In 2011 the global gambling industry took in revenues of just over $400 billion, with only 8% of that figure coming from the online sector. By the end of this year, forecasts suggest that the industry’s global revenues will surpass $516.03 billion – not bad considering that we have just gone through a pandemic.
The single largest contributor to that figure is national lotteries, closely followed by sports betting. Coming in at third though is online casino gambling, with a projected 2021 revenue of just under $70 billion worldwide.
In this article we don’t so much analyze whether online casinos have overtaken their land-based counterparts, instead, we look at why they are beginning to overtake the real thing.
Online vs Land-based Overview
High-profile, reliable, and enticing online casino vendors like DraftKings are outperforming the vast majority of land-based casinos here in the United States. Much of that is down to accessibility, game offering and shifting demographics, however, it’s important to acknowledge the impact of the pandemic.
When the world was plunged into national lockdowns in March of 2020 the land-based casino economy was not performing terribly. Revenues were steadily declining, but large-scale outfits like those found in Las Vegas were not performing too badly.
The pandemic however did hasten the demise of small, local casinos that were struggling before the Coronavirus. The most important impact of the virus however has been in bringing the big-name casino companies crashing back down to earth.
Furlough, lockdowns, and restrictions have put a huge financial strain on every single land-based casino company in the country. What is worse though is that the lockdowns forced many loyal casino goers to move online for their roulette, slots, and poker fun.
In effect, the last 12 months has hastened the long forecast decline of the land-based sector and packed in as many as 10 years’ worths of decline into just 1 short year. For many years the online sector has been trending upwards in popularity to the detriment of the real thing, the virus has just accelerated this trend.
Pandemic’s aside though, what factors were driving the trend from land-based casinos to the online alternative? Let’s take a look…
Many of the huge casinos that you see on the Las Vegas strip make the majority of their profits from slot machines. It is estimated that on average, every slot in the Nevada city earns an average of $126 per day.
That’s why when you walk into any casino you will be greeted with walls packed out with towering slot machine terminals. Without them, casinos would be forced to increase the house edge in traditional table games just to break even.
One thing that consumers value above all else when it comes to slots is variety. Naturally, land-based casinos are hamstrung by the amount of space that large terminals take up in their venues. The online sector, however, has no such issues.
Log in to any of the top online casino sites in the US and you will find a far greater range of slots than at any land-based casino in Las Vegas. Why purposely travel to a casino when you could play a greater range of games from your mobile?
You might have heard your parents saying it and taken it with a pinch of salt but, your much-maligned elders are right, attention spans are indeed shortening. In a recent study by Microsoft, it was found that average attention spans have decreased by 25% in just a few short years.
Stack that up against decades worth of data and it becomes obvious that our collective attention spans are way, way shorter than at any time before (don’t you dare get distracted and open up TikTok to prove the point true!)
Why then, with that in mind are people short on attention going to make a meaningful trip to an out-of-town casino to spend 6 hours gambling? Especially when they can play slots for 10 minutes on their phone this afternoon and have a couple of spins of the roulette wheel before dinner.
Like it or not, online casino gambling just appeals to a modern demographic way better than a classic land-based casino.
If you had wanted to consistently gamble on your mobile phone back in 2010 you would have needed the patience of a Saint. After refreshing the web page (there weren’t many apps back then) when the site had crashed for a 14th straight time you would then be greeted with a clunky, poorly designed user interface.
At that point, you’d give up and go back to doing something more enjoyable, like staring blankly into space… Now, however, it couldn’t be easier to gamble online. Purpose-built apps have been designed with the player in mind and an emphasis on making everything as easy as possible.
In addition to that, there have been great technological advancements allowing for the integration of live streaming technology to make the online experience to the next level. In short, technology and innovation have transformed online gambling from disastrously bad in 2010, to cutting edge in 2021.
Technology has helped to take online gambling to the next level over the course of the past decade, but perversely, the pandemic has had the biggest impact on the sector. It has forced previously loyal land-based players to contemplate playing online.
In doing this it has normalised the online sector to those previously sceptical of it. Whilst land-based casinos are never likely to die out, do expect them to continue to decline in popularity in the coming years.
Outside of large tourist destinations like Las Vegas and Macau, the idea of a local land-based casino may go on to become a fantastical idea.