Jack Smith, Sales director at Sportingtech, outlines some of the most promising regions in LatAm for the sports betting market.
Press release.- With Latin American jurisdictions regulating at pace and the World Cup just around the corner, the continent holds untold potential for operators.
As with the growing number of jurisdictions it proudly serves, Sportingtech is dedicated to helping operators navigate the region’s ever-changing regulatory landscape. To get a better idea of how best to approach the territory, we spoke to the platform provider’s Sales Director, Jack Smith, who assured us that this needs to be done not only on a country-by-country basis but market-by-market.
The heady potential of the Latin American market has never been far from the minds of those determined to grow their igaming and sports betting offerings. However, there are still those that make the mistake of thinking that a one-size-fits-all solution will work in every country across the continent.
The landmass is a vast assortment of countries, each with a plethora of various markets with their own casino and sports betting tastes and differing levels of technological infrastructure. Understanding these differences intimately is the only route to success. This article will outline some of the most promising regions in LatAm and share some insights into the current state and future opportunities of these individual markets.
The regulatory race is on for the giant that is Brazil. In 2018, fixed-odds betting was essentially recognised as a legitimate activity by the country’s government. Subsequently, its Ministry of Economy was given four years to establish a licensing or concession system that would nurture a competitive sports betting culture for both online and retail.
The potential gains of succeeding in this cannot be understated – it is home to possibly the most enthusiastic football fans in the world, and the Qatar-hosted FIFA World Cup is due to kick off in November.
However, Brazilian opportunities abound beyond football and the World Cup. Mixed martial arts, basketball and NBA all have ardent followings as well. That being said, adoption rates remain low, as the country’s economic infrastructure is still reeling in many ways following the pandemic. Regardless, with a populace as massive and passionate about sports as this one, we can expect to see the country experience a significant boom when sports betting becomes operational there.
Sportingtech has been eagerly watching and waiting for the outcome of Brazil’s general election process. The Bolsanaro v Lulu contest appears to be history in the making for Brazil’s licensing regime. Sportingtech relishes the thought of being part of this history.
Already relying on its gaming sector to help it move past the impact of 2020’s events once and for all is Argentina. The country’s online gaming and betting industry generates $2.4bn in annual revenues, upon which government has increased tax from two per cent to five per cent. However, regulation here is carried out at the level of individual provinces — with each making its own decisions regarding casinos and online gambling.
This number will almost certainly increase when the revenues following the World Cup-inspired sports betting and casino cross-sell are added. As one of the most successful teams on the global stage and with Lionel Messi set to be one of the stars of the event, it will attract a huge degree of betting potential. Specifically, we can expect to see a great deal of prop bets on Messi’s performance, with him scoring a hat-trick against Saudi Arabia sure to garner a great deal of bets.
In contrast, some customers will prefer to bet on how Argentina will perform as a team and will favour team props instead. These might not involve the final outcome of the match: for example, Argentina to score more than two goals when they play Poland.
In July, Peru’s Congress voted to legalise online gambling and sports betting in the country, establishing a new regulated framework for the sectors. Overseen by the country’s Ministry of Foreign Trade and Tourism, there have been quite a few fines for violations after the department carried out 1,346 inspections of more than 700 authorised gaming sites. This is why operators shouldn’t risk doing business with partners that have minimal marketplace knowledge.
There is quite a lot to be gained from this new regulated market, but adhering to compliance is going to be essential to doing so. This is a lot easier said than done, which is why Sportingtech is constantly working to improve upon its own compliance team to ensure we can help our partner operators navigate the continuously altering regulation of such markets.
With this in mind, Sportingtech recently named Paul Jerram head of compliance, who has been helping companies navigate regulatory change such as this. Only a few weeks into his tenure, Paul’s already in the thick of it, helping operators balance commercial goals and ever-changing regulatory risks.
It’s equally important to have a partner that knows the lay of the land in Colombia which, like many South American countries, sometimes has relatively unclear laws surrounding gaming and betting. For many years, Colombian residents have been able to place certain types of sports bets through what effectively works like a state-run lottery system. However, with more betting sites in Colombia now accepting players from the country, the government realised there needs to be legislation surrounding iGaming and is actively working to introduce this.
Unfortunately, the Colombian government hasn’t yet made it clear what these online gambling laws will entail. For the moment, however, Colombian players continue to gamble online. The significant resulting revenues are increasingly attributable to casinos. When this pre-regulated market opens up in earnest, Sportingtech will be on hand to help with the nuances of its new regulation and player preferences with a thoroughly localised solution.
The sector is far from being without its challenges and that is clear from recent development in Chile, where a bill to ban online gambling ads in sports clubs is being debated.
If this does become the case, it will be more important than ever that sportsbooks’ offerings are as top-tier and agile as possible to continue attracting customers without the benefit of this kind of advertising.
There is rarely a universally accepted solution to LatAm market penetration. Operators need to identify which countries they want to target and get an ‘on-the-ground’ understanding of the market to ensure success. This can be a daunting prospect but, with the right partner, the rewards will be worth it.