LATAM: Is It Time to Open a Social Casino?

There is a clear need to understand what online social casinos are and whether operating such a business in Latin America is profitable. Throughout this article, we will look at five key points:

1. What are Social Casinos?
2. Opportunity to innovate; social casinos in Latin America.
3. Knowing the young adult audience.
4. In-App monetisation: diversified profitability.
5. A segment with room for development.

1. What is a Social Casino? 

Social casinos are digital platforms that allow users to enjoy social gambling and play casino-style games such as slots, poker, and bingo using virtual currency. Unlike traditional online casinos, this currency can be bought or won through play but cannot be exchanged for real money. They were created to experience the thrill, fun, and enjoyment of iGaming with less risk than that associated with online or land-based casinos, making them accessible to a wider audience. The younger adult audience (aged 18 to 35) is the most likely to download these games.

According to The Business Research Company, the size of this market globally will grow to $7.99 billion by 2024 at a compound annual growth rate (CAGR) of 8.1%. The report adds that this historic growth phenomenon is primarily due to the rise of social gaming, casino entertainment experience, social and community interaction, expansion into emerging markets, regulatory acceptance, sustainability, and green practices. The social casino market is anticipated to reach $11.2 billion growth by 2028, at a compound annual growth rate of 8.8%.

Finally, we cannot lose sight of the fact that Latin American players have a long tradition of gambling enjoyment, with a very active culture around physical casinos and betting events in several countries. As rates of connectivity and access to digital devices continue to grow in the region, consumers are showing an increasing interest in digital entertainment platforms, including casino games and sports betting.

2. Opportunity to Innovate: Social Casinos in Latin America

Unlike other markets such as North America, Europe, and Asia, Latin America still needs well-developed, casino-style social casino platforms. Existing options do not necessarily connect with Latin players' preferences, cultures, and particularities. This opens a door for early adopters to invest in a solid, culturally aligned proposition and gain a competitive advantage in the region.

3. Get to Know the Young Adult Audience.

The value of social casinos lies not only in the entertainment but also in the opportunity to capture information about users. Through these social games, key data can be collected from a young adult audience aged over 18 who may later migrate to real gambling. This information will allow us to understand the preferences and habits of the players.

4. In-App Monetisation: Diversified Profitability

As explained in point one, social casinos' monetisation model differs from traditional casinos. Players' revenue opportunities do not come from direct gambling but from in-app transactions, such as purchasing credits, tokens, power-ups, and customisation items – similar to non-casino-style gaming apps. This allows users to spend money to enhance and enrich their gaming experience without the risks associated with gambling.

5. A Segment with Room for Development

Currently, we see emerging regulations in most countries in the region. This allows investors to experiment and develop products without restrictions or high licensing costs. Moreover, they can quickly adapt their offerings to users' preferences without being constrained by specific regulations. This regulatory vacuum translates into flexibility that can be crucial to innovation in the market.

The Business Research Company (2024, October). Global Social Casino Market Report 2024. The Business Research Company. Retrieved November 11, 2024, from this link.

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Disclaimer:

Latam Entertainment has provided this article for informational purposes and does not necessarily reflect the views of WA.Technology.

Investments in any market, including Latam, should be made after thoroughly analysing and understanding local market and regulatory conditions.

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