Part 1: A guide for Online Casinos
In this first article in a two part series, Dan talks us through his insights on the “how’s and why’s” online casinos should consider launching into the esports betting space in 2021 and beyond. If you would like to read part two, visit the guide for sportsbook operators.
If you are responsible for an online casinos product lineup then esports may be a confusing or an unlikely contender for a position in your roadmap since the common perception of esports betting is that it’s firmly classified as a type of sports betting. It’s certainly not casino either. However there is a great relationship between casino, live casino and esports betting – a relationship where these verticals can not only exist on the same platform but actually perform well as a synergy and complement each other.
To get a better understanding of why esports betting can fit alongside traditional casino models – without the need for a sportsbook or even for sports betting fans, let’s look at the history and culture of esports and esports betting. The esports demographic has always been youthful, even today it's the 18 to 35 year olds who make up the majority of the customer base. This is because starting in the 70’s but exploding in the 80’s and 90’s kids began to grow up playing computer games. This audience has now matured and makes up the more affluent age group of the demographic today. At the younger end of the scale you have young adults who grew up in the 2000s who are now old enough to enjoy a bet and likely spent their childhood playing games and also likely still enjoy playing games today. This young adult segment actually witnessed the sharp rise of multiplayer internet connected gaming and MMORPG games – mainstream appealing games which are played online and lend themselves well to amater and professional esports tournaments.
This demographic intersects clearly with the casino demographic, but more interestingly it represents the sweet spot to target for desirable casino players. Players who have come of age and have some spare money to play casino games and place bets on esports.
In many ways, to understand the attraction of esports to casino players and vice-versa we need to look at esports betting in a new way. We need to look at esports betting as a stand-alone product and not just a subsection of sportsbook which could only appeal to people who place sports bets. Esports is different enough from football, tennis, horse racing and every other sport to be considered its own distinct species. In fact people who are into video games are often enough not the “sporting type”.
If we zoom in further on the idea, you can see esports has many different and unique betting opportunities and bet types, ranging from first blood to simple map wins. These are vastly different from the common models used in sports betting which mostly focus along some common lines even between different sport types. In addition, esports requires its own unique peripheral data sets which customers need to reference before placing bets – esports betting customers can’t just open the newspaper or a website to easily find all of the performance data they need to reference in one place to make informed decisions they need this information to hand within the esports betting application itself.
Once you realize that esports betting is it’s own unique product vertical and it’s not tied down to sportsbook you can see the possibilities of coupling it to your own platforms alongside a wide variety of casino products. Once established on it’s own primary menu link after “Casino” and “Live Casino” your customers can find a whole new world of fun. Expect a decent % of cross sell take up for the product but likewise expect to attract many esports fans who will have a few spins of roulette or a few spins on slots while watching teams do battle in-play on esports live streams.
If your casino brand is a “start-up” I’d recommend the addition of esports betting to your line up right away because it will only act as a magnet for your target demographics and help build a customer base who will return frequently to place bets on live esports events. It’s good to have customers come back right on the clock as expected whenever there are esports events going on! Without it, there will be no schedule that encourages your customers to turn up, log in and deposit on any given day.
Don’t forget that depending on your casino's area of operation and licensing requirements, many regulators class esports betting as sports betting (real / live events betting) so your company may need to take out additional licensing if they only hold a license to operate casino games.
My advice is similar for established casinos. Adding a new dedicated “tab” for esports will help work wonders for boosting GGR but with the added twist of rejuvenating your customer base and reaching new customers. Many markets around the world have experienced a saturation point in online casino games uptake and GGR. Essentially revenue among well established operators has been somewhat flatlining for RNG (slots) and even live casino and it’s been a difficult challenge to innovate a solution into action. Creating a new product vertical is not a bad card to play.
There are some caveats though, you can’t undertake the launching of a new product vertical too lightly, regardless of if you are a new operator or a well established brand with tens of thousands of customers. Integration of the Esportsbook solution from EsportsConstruct for example is fairly straightforward and fast – it has been modelled to be as easy as a casino API integration and as easy to launch a game as a slot. However just because the technical and commercial barriers to entry have been lowered doesn’t mean the hard work is now over. A new product vertical like esports is going to need a few things to form a backbone of success – you can’t just go live with a new product and expect people to find it and deposit and play!
If you want to get in on the trend and capture market share in esports and also run a successful cross sell then you will need to hire an esports expert or find one within your existing talent pool. You need someone to take ownership for the successful running of the product and to drive the revenue, customer numbers and retention to consistently improve and meet your business goals. Aside from having the right leader in place you will also need to be prepared with business plans for marketing. Acquisition channels for esports betting customers are not alien to your traditional ones for casino, but watch out for potential investments in widening affiliate channels, improving your SEO and targeting new keywords in your PPC campaigns. You will also do well to invest in relevant content and consider looking at sponsorship opportunities. Perhaps even sponsoring esports teams and tournaments with your branding and merchandise.
Finally, consider the geographic location of your target markets. If you want to get rich quick then you should focus on established markets for esports betting such as in the Far East and South East Asia. There is also strong demand in Europe but be prepared for heavy regulation, high CPA cost and stiff competition. Look to LATAM, India and Africa for extreme growth potential, perhaps with less tight competition and regulation. India alone I expect will soon surpass the combined GGR from esports in Europe within the next 18 to 24 months. Last, but not least, if you have the state-by-state licenses in place or on your roadmap then the USA is rapidly warming up to esports betting, mostly classified under sports betting. Clearly, there are opportunities to be enjoyed globally and if your current casino demographic doesn’t really fit in with any areas of high demand for esports betting then you can potentially use esports to enter into new regional markets and find new customers there to further expand your business.
About the Author
Dan is passionate about the potential of esports in the betting industry and is the CCO at EsportsConstruct – a B2B gaming product supplier that specializes in turn-key esports betting solutions and their flagship product – Esportsbook. Dan has been involved in the iGaming industry for more than a decade and has worked with top names in the industry such as William Hill, Dafabet, Betfred, Betvictor and 188BET. Dan has previously directed and managed the implementation of EsportsConstruct’s Esportsbook product inside operators product ecosystems and achieved great success in East Asia. You can reach Dan with questions, feedback or comments using our contact form.