Study: iGaming May Boost Land-Based Casino Revenue
LISTEN TO THIS ARTICLE:A new study throws a curveball into the debate surrounding online gambling's impact on traditional casinos. While land-based casino operators claim iGaming strips them of customers, the facts show a different outcome.
Fueling Growth, Not Cannibalization
Commissioned by the iDevelopment and Economic Association (iDEA Growth) and conducted by gaming industry experts Eilers & Krejcik Gaming (EKG), "Comparing Online and Land-based Casino Gaming" challenges the assumption that online gambling, or iGaming, cannibalizes existing revenue from brick-and-mortar casinos. Instead, the research paints a different picture, suggesting that iGaming can actually act as a synergistic partner, driving growth and economic benefits for both online and offline establishments.
Related: Study: iGaming in Indiana Wouldn't Seriously Impact Retail GamblingThe study sheds light on the potential economic boon of legalizing and regulating iGaming. It argues that online gambling platforms aren't direct competitors to traditional casinos but rather complementary avenues that attract new audiences and generate additional revenue streams.
This translates to tangible benefits for states considering legalizing iGaming. The study showed an average 2.44% in quarterly revenue boost observed in the six US states that have already taken the plunge.
EKG's team went beyond analyzing historical data. It utilized advanced modeling techniques to predict the potential impact of iGaming in states yet to embrace it. The results are encouraging: a projected 1.7% annual revenue increase for land-based casinos once iGaming is introduced. This suggests that iGaming doesn't steal customers from traditional establishments but rather expands the overall gambling market, creating a rising tide that lifts all industry players.
Debunking Previous Narratives
The study doesn't shy away from addressing previous research with opposing conclusions. It tackles criticisms against previous iGaming analyses, specifically targeting a report by The Innovation Group for Maryland that predicted a potential 10% revenue decline for land-based casinos due to online competition.
EKG counters this claim specifically in the report. It highlighted methodological flaws in the Maryland study, such as misinterpreting population growth data and employing inaccurate comparison methods.
By presenting compelling evidence that iGaming acts as a growth catalyst rather than a competitor, the EKG study paints a positive outlook for the future of the gambling industry. Legalization and regulation of iGaming, as the research suggests, hold the potential to create a more robust and prosperous ecosystem, benefiting both online and offline participants. Additionally, states considering this path can unlock new avenues for tax revenue generation while simultaneously fostering responsible gambling practices through proper regulatory frameworks.
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