On March 21, 2024, the Sports Betting Alliance (SBA), formed by some of the leading providers of legal sports betting in the US, unveiled an exhaustive economic study, conducted by Analysis Group, Inc. The 167-page report demonstrates how the expanded iGaming industry boosts casino revenue at land-based establishments and strengthens the overall gaming market.
The study, entitled “The Potential Economic Impact of Legalizing iGaming on Casino Revenues in Five States”, zeros in on brick-and-mortar gaming establishments across five states – Illinois, Louisiana, Maryland, New York, and Virginia, with estimates pointing to hundreds of millions in projected revenue as a direct consequence of iGaming’s expansion. The economic analysis indicated that following the legalization of iGaming in Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, and West Virginia, the casino revenue at brick-and-mortar venues increased by 1.9%.
Furthermore, it demonstrated that the combined revenue from remote and land-based gaming in the said current gaming states was, on average, 46% higher in 2023 than before the legalization of the online gaming market. Pennsylvania, for example, demonstrated the largest market expansion, with a 58.9% increase, from $3,256 Million in land-based revenue up to 2018 to $5,175 Million in combined gaming revenue in 2023.
The study tracked data from each state, providing a comparative analysis of the periods before, during, and after the legalization of the iGaming market. Of the legal iGaming states, Pennsylvania provided a clear illustration of the changing trends and circumstances, with land-based casino revenues growing from $3 Billion annually before iGaming to over $5 Billion after the legalization.
Analysis Group Surveyed 2,389 Present and Future Players, Focusing on Their Gaming Usage and Preferences
Along with the comprehensive evaluation of market data, the Analysis Group conducted a survey, inquiring into the gaming usage and preferences of 2,389 respondents, including current and prospective players.
The results demonstrated that with the launch of iGaming, most casino customers have not decreased their activity at physical gaming venues, neither in frequency nor gambling spend. On the contrary, more survey respondents confirmed those two aspects have increased.
The total results for all iGaming states in terms of frequency of land-based casino visits after the launch of iGaming point to 26.5% of the respondents confirming an increase, 49.4% saying no change occurred, and 18.7% reporting a decrease.
As for the total spent in land-based casino visits that customers reported in all iGaming states, 26.1% said it increased, 52.2% replied it stayed the same, and 16.9% confirmed a decrease.
The results from the five projected iGaming states were approximately the same.
Contrary to general convictions about iGaming being detrimental to land-based gaming revenue, the analysis suggested that both forms of gaming “serve different, complementary purposes”. As most of the survey participants confirmed, while online gaming provided them with ease of access and convenience, land-based gaming offered the incomparable thrill of social interaction and authentic gaming experience.
