Online Lotteries: Why you need to be ‘In it to win it’

Online gambling is known for consistent growth. Even through the lean years following the 2009 crash, it was one of the few sectors to keep expanding, and there is one sub-sector of the iGaming industry that has outperformed all others: Online lottery.

The global lottery market now accounts for 29% of all gambling revenues, adding up to an impressive $279.9 billion in 2016, although only 10% of the overall total is made up of online lotto. With draws like US Powerball ($1.56 billion) and Spain’s Christmas El Gordo (€2.4 billion) on offer, it’s easy to see the untapped potential within this market.

These are numbers that no gambling business can afford to ignore, so it’s not only the lottery players who need to be in it to win it. In fact, to coin another over-used lottery pun, if you miss it, you’ll miss out. Whether you represent an established operator looking for new revenue streams, or a brand-new entrant to the market, online lottery needs to be on your radar.

Lottery can open up a whole new market. While there are, of course, crossovers between regular gamblers and lotto lovers, there are many people who only play lottery. They see it as buying a dream, their key to a better life for themselves and their family. They will happily play week in, week out, with the dream of winning big. This represents a huge, loyal and largely untapped market.

Traditionally, most online lottery companies operated a messenger service, involving the physical purchase of tickets. While this model was perfectly serviceable, and is still used successfully by some companies, it has largely been surpassed by the insurance model. This is not only more straightforward logistically, it also offers guaranteed payouts and transfers the risk from the operator to the insurer.

In terms of the model, there are two types of solution available, and the one you choose will most likely depend on your current business model. For established iGaming operators, an embed solution can be used to integrate lottery into your existing site, with operations and customer service delivered by your existing team. For standalone lottery sites, a fully managed white label package is likely to make more sense.

Between 2010 and 2016, global lottery sales increased consistently by up to 13.3% per year. In 2017, total global growth is expected to be 10%, with Africa leading the charge at 27.6%. These are figures most operators, even in the online gambling sector, can only dream of, which is why I can confidently say you’ll be missing out if you don’t get in on the action.

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