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A Profile of the Online Gambler
by Rob Jay
Las Vegas, NV (PRWEB) March 19, 2004 -– A PROFILE
OF THE ONLINE GAMBLER By Robert Jay - Online gambling
on sports in America has surpassed the total handle
of Las Vegas casino-based sports books.
A December, 2002 Congressional Report by the US
General Accounting Office stated that online gaming
reached new heights in 2002 as worldwide revenues
topped $4 billion. Of that amount, over $2 billion
was wagered by US residents.
Bear Stearns backed
up these findings by estimating the worldwide market
would have been in excess of $5 billion had many
American credit card providers not discontinued
offering transfers to offshore sports books. Meanwhile,
the Nevada handle on sports books was less than
$2 billion in 2002; this is the first time in a
decade that the Nevada handle dropped below $2 billion.
Certainly, part of the decline in the Nevada handle
can be blamed on less Americans traveling and an
overall downturn in the economy. Perhaps an even
bigger factor, however, is the proliferation of
slot machines in Nevada casinos. Slots now represent
70% of the profits of Nevada casinos and offer a
6% hold while sports books have an average 3% hold.
Thus, it is not surprising that sports books are
losing square footage overall in casinos while slots
are gaining in space allocated to them.
According to Debbie Silverman of Gone Gambling,
an industry portal site, another big growth area
for offshore sports books is that many local bookmakers
are referring business to the offshore books for
safety. Large players are also moving to the internet
due to more attractive odds available from the offshore
books than are available in Las Vegas. In addition,
many offshore sports books attract players with
bonuses that you won’t find on The Strip. Anthony
Wayne, spokesperson for licensed Curacao-based sports
book EWINNER.com (http://www.ewinner.com/), said
that his company offers a 15% initial deposit bonus
to new depositors. “With all of the new competitors
out there,” said Wayne, “you almost have
to do something special to try to attract new players.”
The bonus situation is not any different in the
other popular areas of online gambling, notably
bingo and lottery services. Bingo House (http://www.bingohouse.com)
offers a 100% initial bonus, according to Bonnie
Edwards, director of marketing. Edwards’ other
site, Lucky Lotto (http://www.luckylotto.com) offers
a free $7 bet. The demographics, however, are quite
different. “Our players are predominantly females
40-50 years old,” said Edwards.
The Congressional Report goes on to state that one
million Americans gamble online every day. One of
the reasons for the large amount of online sports
bettors is the similarity between the typical sports
gambler and the typical heavy internet user, according
to David Lee, of Mandalay Bay casino. Lee stated
that 77% of online sports gamblers are men. They
tend to be single, 25-34 years old, college educated,
and with incomes between $40,000 and $80,000 per
year. A survey of 2900 internet users by online
gaming industry research company, The River City
Group, backs up Lee’s findings. The 2001 study
indicated 74% of online gamblers are male and that
they are among the youngest, highest income, highest
education group on the internet. They are also technologically
advanced, early adopters, and heavy wireless users.
Jay Davis, president of Triumph Marketing, a marketing
agency that has clients in the online gaming industry,
tends to agree with the conclusion of the studies.
“A typical customer for an online sports book
is a male 25-40 with an average income of $70,000
per year. They are typically college educated and
avid sports fans.”
Future growth of the online gaming industry will
come more rapidly on a worldwide basis than in the
United States, says the Congressional Report. Americans,
which now represent half of the online gaming revenues,
are projected to be only 24% of the $14.5 billion
worldwide market anticipated in 2006. Japan is of
extreme interest to the industry because its household
internet penetration of greater than 80% is the
largest in the world and it is a country nearly
as obsessed with sports as America is. Countries
with even more long-term promise for the industry
are China and Malaysia where already two times more
people have gambled on the internet than have purchased
a product online.
“Without question, the largest areas for growth
are South America and the Far East due to increased
internet usage and cultures immersed with a long
history of gambling,” added Davis. “These
markets have only a small percentage of the saturation
levels of North America and western Europe and offer
operators markets where the cost of acquisition
(of new customers) is remarkably lower.”
While international markets clearly offer an opportunity
for expansion, the offshore industry can continue
to attract more new players to the industry in all
countries if it satisfies new player concerns. According
to the River City Group, the primary concerns of
potential new players include: a hassle free experience;
quick payments; easy instructions; attractive web
sites; easy registration; secure credit card transactions;
certificates from consumer protection agencies;
better odds; ability to play for free; 24/7 customer
service.
Since the first internet gaming sites began appearing
in 1995, 73 governments have approved some form
of internet gambling. The industry has grown from
900 to 1400 sites in the last two years, according
to The Internet Gambling Report. In recent months,
however, most industry analysts believe the amount
of sites has actually declined. The number of customers
is not growing at the same pace as the number of
sites and “consolidation among operators is
the most logical transgression within the industry,”
said Davis.
Today, only two states, Utah and Hawaii, have no
forms of gambling permitted. Although the United
States has clearly not endorsed internet sports
gaming, it is interesting to note that more than
80% of horse racing bets are now made away from
the track at off track betting locations and through
other media like interactive television.
One other conclusion of the Congressional Report
is that most online players would prefer to play
with a “name brand” casino rather than
those virtual unknown offshore books available on
the internet. With market share at the Las Vegas
casinos continuing to decline to the offshore sports
books, casino operators can only hope that they
will soon be endorsed to operate online again.
robjay@hotmail.com
# # #
About the Author
Rob Jay lives in Curacao and is an internet marketing
guru.
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