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The reasons for the failure of some online casinos
The online gambling industry is among the most promising and highly profitable niches. In practice, it has proven its resilience to crises and stability even in the face of force majeure. As a result, dozens of new projects in this area open daily. But most fail.
We tell you about the main mistakes that make startups fail in iGaming and the field of teen patti online casinos and explain how to avoid fatal blunders.
Why online gambling projects fail
The volume of the global online gambling industry has a steady upward trend despite crises and unforeseen circumstances, as reported by Statista platform analysts.
Although the industry continues to grow strongly, most promising projects in online gambling fail, and the gambling market is one of the most difficult to enter. Moreover, unlike many other established and regulated spheres, gambling has its specifics, which makes the work in this niche as dynamic and unpredictable as possible.
Let’s look at the top reasons why iGaming startups fail most often.
Misunderstanding the actual value of marketing in the gambling industry
Most online gambling startups don’t realize the actual size of the cost of attracting customers in this niche. Implementing a comprehensive marketing strategy is the most oversized expense item, both at the launch stage of a gambling site and in the process of its further operation.
The costs of attracting and retaining players in the early stages of launching an online casino or betting office are many times higher than the income received. Quite often, a young business suddenly discovers that marketing costs are not decreasing and profits are not growing at the same rate as expected.
Online bookmakers and casinos should accurately model customer acquisition strategies and use all channels to attract players. Moreover, developing a marketing strategy that will attract and retain players with maximum efficiency and minimum costs is necessary. At the same time, the budget should be calculated as early as in preparation for the project launch.
A plan of promotion of a gambling platform should include a maximum number of channels:
- Bonus system – one of the critical factors on which many players choose a platform for registration.
- Loyalty program – a system of rewards that allows keeping loyal customers on the platform.
- Tournaments – another tool that involves players in the entertainment process in the competition for a particular prize: freespins, bonus or real money, material gifts, etc.
- Gamification – implementation of game mechanics to engage users. The game should begin not after the slot launch or the first bet but from the first minutes of the client’s stay on the casino site.
- External advertising – placing banners, video screens, and other information boards.
- Advertising on television, radio, and the Internet – is one of the most expensive types of advertising to reach a mass audience.
- Affiliate marketing – attracting customers with the help of partners, which can be affiliates, web admins, bloggers, opinion leaders, streamers, and other interested parties. To avoid low-quality traffic, you should choose an affiliate payment model that will guarantee results.
It is also important to remember that gambling advertising is restricted or even wholly prohibited in many jurisdictions. Therefore, the choice of promotion methods should be based on local laws.
Lack of the necessary amount of investment
Most gambling startups ignore the most critical steps to build and launch a quality resource, not because they don’t know about them but because of the banal lack of money. You will need a lot of investment to create a legitimate business and impress players with a quality offering. A startup in online gambling must have enough funds, either owned or attracted, to pass the formation stage and achieve growth without too many problems.
When calculating the investment in launching an online casino or betting office, the need for funding should be taken into account:
- The founding of the company and the purchase of the license;
- Further licensing fees, payments, taxes;
- gambling software;
- price for the services of gambling providers;
- The hiring of staff and additional pay;
- implementation of marketing strategy;
- other operating expenses.
- Any omissions in the preliminary calculation of the budget can later lead to disastrous consequences and the project’s failure as a whole.
Misunderstanding of customer requests
The main goal of any business is to meet customer needs. A company’s success is measured by how satisfied customers are with the services they receive. However, often startups in iGaming are not eager to adapt to trends and personalize services for customers.
Before launching a project, you need to research your target audience. Understanding your customers’ needs will further help close their needs and get a high consumer demand. Therefore, it is necessary not only to understand the age and income level of the players but also to know how much money they are willing to spend on entertainment, what games they choose, how often they change their preferences, etc.
A comprehensive study of the target audience will help understand what customers need in a particular market and how a new iGaming business can provide it.
Lack of a unique offer
Projects in online gambling often resemble each other like twins. However, launching another online casino with a standard website interface and familiar games is far from what the market needs.
But the real success lies in the unique offer, which will go beyond the standard range of games and bets, cover the audience’s needs, and make the platform stand out from the competitors. The more unique offerings the site has in store for users, the more players will be interested in playing on this particular site.
Poor work of the support service
Quite often, online gambling startups do not realize the need for good customer support, which usually leads to frustrated players and loss of customers.
Of course, the gambling platform should be functional and intuitive. The entertainment should have a demo and an explanation of the rules so that even a novice can understand the entertainment process independently. However, there are many situations in which customers need help. And the critical task of the service provider is to provide this help in a timely and professional manner.
It is essential not just to create a helpdesk service but to ensure the quality work of managers in a language that is understandable to customers. Additionally, VIP customers should be provided with the proper level of service.
Even though the gambling sphere is one of the most promising, launching projects in it is very complex and expensive. For a startup to be successful, it must be thought out to the smallest detail. However, even the most elaborate business ideas can go bust because of trivial but prevalent mistakes, which we have discussed in this article.