The African gaming market is awash with activity, and sportsbooks are a key driver in its recent success. There is a significant amount of growth underway in the space and the market is rightly garnering plenty of attention as operators look to expand their offering into new territories.
Before considering entering the African domain it’s imperative to appreciate that no one country has the exact gaming characteristics. There are certainly countries with similar trends and behaviours, but it is effectively 54 different markets to consider. A one-size-fits-all approach for operators simply will not work meaning thorough research must be undertaken to make it a successful venture for any business.
Current Trends
Detailed analysis reveals unique intricacies in countries, but one common factor is the immense passion for football across the continent. The vast majority of Africa is concentrated primarily on football betting and the most popular leagues from around the world. England’s Premier League leads the way, but La Liga, Ligue 1 and Serie A are not a million miles behind.
These leagues are the main draw for sports betting shops, but they refrain from showing live sports to ensure the core offering is not diluted by the noise and they turn into sports bars. To maintain decent shop footfall a move has been made towards installing virtual gaming solutions.
Virtual gaming products are proving popular across some African markets, but clearly don’t rely on any education or research to be done in comparison to live sports. Sportsbooks on live events provide a better route for expansion as they combine the passion from supporting clubs with chances of profitable returns.
Expansion also needs the right infrastructure in place and consolidation paves the way most effectively. Consolidation of territories across Africa is a trend we are seeing more and more of, which is why many European-based operators are eyeing expansion opportunities here.
It is always important to monitor how a country is politically balanced as there are many changes going on. Nigeria is a case in point where the price of oil has dropped significantly in recent times to lead to a major downturn in the economy. Kenya has also been in the news in the past few months following the government’s decision to bring in a new gambling tax.
The original tax rates ranged between 5% and 15% of gross gaming revenue, and applied to any income generated through gambling, including player winnings. A new rate that seems to have settled around 35% represents something of a compromise from the government’s original 50% target, which was rejected by the legal department. However, it is still seen as a noteworthy threat to the country’s licensed gambling operators. Kenya remains Africa’s third-largest gambling market behind South Africa and Nigeria. On the ground, African sports betting customers are becoming better educated and traditional products are beginning to have less of an impact on customers.
In comparison to other betting markets, Africa has more interest in virtuals than somewhere like Asia. Using bet history data that we receive to create a profile of a player virtuals in the more traditional betting territories attract less than 2% of turnover. In Africa there is much more reliance on virtual as there is less choice. Furthermore, many of the African sportsbooks are run by marketers who may not be bettors and therefore they like virtuals because they are guaranteed an 8% margin as opposed to the more volatile sports betting markets where, in the absence of effective risk management, they can be clobbered when results go against them. The trend tends to be that, more choice, less virtual.
Future Trends
There are plenty of opportunities to grow the sportsbook market and I think there are chances to educate the market to enrich African players with different methods and betting markets. By giving people more choice it increases the enjoyment and lifetime value of a player.
A potential issue of giving players more options are then explaining the benefits and why they should move away from more traditional markets like 1×2 football. It can be daunting to switch from your usual habits and that’s where preview content and analysis help operators step up to the plate.
Bettorlogic provides sportsbooks with insightful and in-depth information for shop managers to display. This brings in punters and then also opens up new avenues to explore. Big data grows in importance and we are in a unique position to analyse past customer activity which aides how sportsbooks can tailor their product for individuals.
It’s a way for customers to see what other sporting events there are and why they might prove more profitable, although there is still a relatively concentrated selection of betting markets. Local operators are successful marketers, but not all are experienced in how to adapt sportsbooks for the modern user and integrate a more diverse offering.
Placing bets at retail shops and via mobile devices are the two most popular channels for betting in Africa but the nature of wagers placed will vary depending on the bettor’s location and channel choice.
Kenya is a fascinating market at the moment and a perfect example of why a long-term strategy may not be the best recipe for success. The country will hold a general election in August which may provide the opposition Orange Democratic Party – an open critic of the new tax seemingly agreed on – the opportunity to set a more workable rate.
Agility is the best way to succeed in Africa. Gone are the days where a long-term strategy is the recipe for success as news travels like wildfire to negate the impact of a plan. Bettorlogic consequently has created a wide range of products for operators to choose from whatever their needs. Each gives insight and analysis on sports betting, but in different ways and sports.
The way to maximise the impact of betting analysis is an intuitive platform to avoid legacy issues of yesteryear. Rolling out a clearly defined sportsbooks offering is not the way forward as the focus must be on providing a bespoke product built from customer habits to be adaptable.
Conclusion
Localisation gives operators the best chance to ensure their product is right for the many different markets throughout Africa. Working with local partners develops respect and reputation amongst your betting audience to build stronger relationships.
Customers in some countries will only really trust an operator if they have a bricks and mortar portfolio. In these cases, there is no point going online if there is no one willing to take a risk. If something goes wrong it’s important for people to feel they can speak with someone face-to-face. A major brand in Europe would have little effect if there was no physical presence to cater for this audience.
Africa has a bet now mentality and will look at markets in the immediate future, not on who might win each golf Major, Grand Slam or the Champions League in May. In this sense, the Eastern European betting scene has certain similarities.
Understanding these African intricacies means you have a far greater chance of succeeding in what is a very exciting space in the gaming sector. There are huge growth opportunities for those that are diligent enough to ensure the product is tailored to the right audience.
