As UK Gambling Moves Online, Traditional Establishments Suffer

Trends show that companies developing their online business – whether it is sports betting, casinos or both – are generating serious profits, while those that do not embrace these changes are left behind.

As UK land based casinos are struggling to attract customers and some are even forced to close, business is booming for major stakeholders with an Internet presence, such as Ladbrokes or William Hill.

The lack of business at brick-and-mortar establishments can only be partially explained by the difficult economic times and the level of taxes set by the UK gambling laws, since betting terminals located in less affluent areas are highly profitable. So are the bookies and the lottery.

It would therefore make sense to look for explanations elsewhere to understand the skyrocketing revenues that the online gambling industry generates.

If we look for the main differences between traditional casino or betshop betting and their online equivalents, the first and most important factor that comes to mind is convenience. Convenience comes in many shapes and forms, from the liberty to spend as little or as much time playing as one desires, to the lack of dress codes, zero travel times and even the avoidance of crowds.

The variety of games that can be accessed very quickly is also much greater online than at most classic casinos. When it comes to online sportsbooks in UK, Internet access places all the news, analyses and even live coverage at the punter’s fingertips – much more so than at any high street location.

Furthermore, Internet venues are able to provide bonuses, promotions and welcome offers much more easily than land-based establishments, who would have to go through rather complex and cumbersome procedures to match these offers.

Choice, comfort, ease of access – these are all decisive factors that tilt the balance towards online alternatives and companies have been forced to ride this wave.

William Hill has been among the most successful of these companies, launching several new mobile gambling and betting sites and applications in 2012. As a result of this strategy, their revenue growth has been over 20% for the third year in a row.

CEO Ralph Topping had this to say: “The fourth quarter delivered a strong end to an already good year in 2012. Performance was robust in retail, and profits continued to grow strongly online, with sporting results going in our favour in both channels.”

The group is also going ahead with the Sportingbet acquisition by the end of Q1 2013, in line with the above strategy. The market has rewarded these efforts handsomely, with William Hill shares shooting up over 60% in 2012.

This is of course just one example, but it shows a very clear way forward.

On the other hand, in order to retain their competitiveness, classic casinos have been forced to open towards the new generation of players, offering mobile gambling solutions or repositioning themselves as family entertainment complexes, in order to attract more business. This trend is most visible in the US, but there are signs that gambling establishments in other countries will follow suit if they wish to remain in operation.