A recent study has challenged the long-held belief that online gaming poses a threat to brick-and-mortar casinos. Commissioned by the iDevelopment and Economic Association (iDEA Growth) and conducted by Eilers & Krejcik Gaming (EKG), the study suggests that far from cannibalizing traditional casino revenue, online gaming might actually be enhancing it.
Online Gaming Boosts Brick-and-Mortar Casino Revenue by 2.44%
The study, titled “Comparing Online and Land-based Casino Gaming,” presents compelling evidence indicating that the introduction of online gaming has a positive impact on the performance of brick-and-mortar establishments.
Jeff Ifrah, founder and general counsel of iDEA Growth, emphasized the significance of these findings, stating that online gambling serves as a catalyst for growth rather than a competitor to land-based casinos.
According to the report, states that have embraced online gaming have experienced notable increases in quarterly revenue. The study suggests that the implementation of iGaming in the six US states where it is regulated results in an average quarterly revenue increase of 2.44%.
EKG’s team of economists and industry experts analyzed data from those six US states, comparing their growth rates with those of states exclusively reliant on land-based casinos. Surprisingly, five out of the six states with legal online gaming surpassed their land-based counterparts in revenue growth.
Online Gaming Rescues Declining Casino Markets, Study Reveals
Matt Kaufman, Managing Director of EKG, emphasized the substantial benefits observed in casino markets that have integrated online gaming. He pointed out that while many states with traditional casino markets have seen declines in recent years, those that have introduced online gaming have witnessed a flattening or even a return to growth in revenue.
The study’s methodology involved a thorough examination of data spanning 16 years, providing a comprehensive understanding of the relationship between online and land-based gaming. It dispels concerns that online gaming would divert patrons from physical casinos, suggesting instead that it attracts a different demographic of players, thus broadening the customer base.
Furthermore, the report highlights the distinct characteristics of online and land-based casino patrons. While online gaming tends to appeal to a slightly younger demographic, with shorter average visit durations, traditional casinos attract a broader age range and offer a more immersive, longer-lasting experience.
As legislative bodies across various states, including Alabama, Indiana and Wyoming, deliberate on the legalization and regulation of online gaming, these findings offer valuable insights. They challenge the conventional wisdom surrounding the relationship between online and traditional gaming establishments, paving the way for a more nuanced understanding of their coexistence and mutual benefit.
Silvia Pavlof
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