Andrew Morgan, International Director at Independent Content Services, anticipates 2019 will be all about M&A, the USA and the ongoing rise of esports.
It has been another incredible year for the global online gambling industry. From power-play acquisitions to new markets opening their doors to legal betting for the very first time, the past 12 months have been transformational for the sector.
But it hasn’t all been plain sailing; regulators in markets around the world have tightened the screw on operators, while margins continue to be squeezed due to tax increases and crackdowns on bonuses and advertising.
For these reasons and more, 2019 looks set to be a roller-coaster year for online gambling operators and suppliers, with plenty of challenges to be overcome in order to unlock the incredible opportunities on the table.
Here are some of the key trends I think will emerge over the coming 12 months:
1) Another wave of M&A will crash down over the sector. William Hill’s takeover of Mr Green is just the start. Related to this, I think we will see M&A used as a way for established operators to pivot away from the UK and refocus on international markets such as the USA.
2) Margins look set to tighten as governments increase betting taxes and crack down on advertising in mature markets such as the UK. At the same time, bookies need to differentiate their product in new markets in order to stand out from their rivals.
Emerging regions such as the USA and Africa offer huge potential, but competition will be fierce and to succeed operators must innovate across all areas of the business and deliver a truly superior player experience.
3) Additional US states will legalise sports betting and deploy regulatory frameworks to license operators plying their trade within their borders. I think by the end of 2019 we could see 15-20 states up and running. The industry will therefore treat the United States with ever increasing importance, with more conferences taking place there.
4) Away from the US, Brazil and Argentina will build on the small steps made at the tail end of 2018 regarding the legalisation of sports betting. In addition, I think voices in India will become louder and while the market may not legalise in 2019, I believe significant progress will be made.
5) The importance of data will continue unabashed. Operators now understand that gathering, segmenting, analysing and acting upon the huge volumes of information they collect each day is key to driving efficiencies and improving their products and services.
6) eSports will continue its meteoric rise and eSports specific bookmakers such as Luckbox will lay down a major marker to established operators. This will force the major brands to finally take esports seriously.
To do this, they will need to focus on personalisation. eSports bettors want their own experience and to offer this, operators will have to use data to generate specific bets and markets, as well as bespoke written, audio and video content that appeals to this largely millennial demographic.
7) Artificial Intelligence (AI) and smart assistants will play a greater role in delivering a personalised and improved player experience. We are already seeing operators use AI to recommend games, markets, odds etc to players.
Voice assistants such as Amazon Alexa will also be used by more bookmakers to engage players and provide them with the information and data they need to wager without lifting a finger – literally.
8) Finally, I think we will see a resurgence in the popularity of bingo in 2019. The betting industry has been damaged by FOBTs and an over-saturation of adverts, and has a largely unfavourable impression among the general public.
Bingo, on the other hand, is seen as a more acceptable form of gambling – a bit like playing the lottery – but has been neglected by operators in recent months and years. There is plenty of untapped potential, so long as the vertical receives a little attention and innovation.