Mixed Outlook for Gambling Amid COVID-19 Outbreak. Casinos Market Declines by -10.8% in 2020
While the pandemic and lockdowns have largely benefitted the gaming industry, the gambling sector has been less lucky faced with a tepid outlook and a mixed bag of opportunities and challenges.
With 74.6% of revenues coming from the offline brick and motor sector, the closure of entertainment centers and casinos as part of the lockdowns imposed in 1st Q 2020 impacted revenues and profitability for companies.
The global market for casinos is expected to decline by 10.8% in the year 2020. The abrupt halting of economic activity has pushed businesses across all industries into financial distress. Sudden fall in revenues and profits as a result of demand disruptions has resulted in workforce pruning and layoffs.
Unemployment rates have hit never-before highs with the US topping the charts with 12.5% unemployed as a % of the total labor force. The social outlook against this background remains grim with households expected to witness erosion in wealth. Personal financial outlook, community, economy, job security confidence, purchasing and investment confidence are all tumbling as the human and economic cost of the global pandemic rises.
While brick and motor casinos stagnate, online casinos are faring better although limited by lower discretionary spending. The increase in spending is coming largely from gaming addicts and from consumer clusters spending more on online retail and entertainment during the pandemic.
Prostrate Travel and Tourism Sector & Legal Restraints to Challenge Growth Even as Casinos Reopen
Even as casinos begin to reopen as lockdowns are cautiously eased in countries worldwide, they face the challenge of falling consumer confidence and spending and the still prostrate travel and tourism sector. In Las Vegas for instance which is the gambling Mecca of the world, millions of tourists and visitors make up for the large customer base at casinos.
Gaming operators from Macau to Las Vegas are all anticipating a rough restart after gaming properties are allowed to reopen. In Macau, a few gaming properties have reopened but could not see desirable outcomes. In gambling destinations such as Parisian Macao, Venetian Macao, Sands Cotai Central, Wynn Palace, City of Dreams, Galaxy Macau, MGM Cotai, Grand Lisboa, MGC Macau, Star World and Wynn Macau, customer turnover still remains low.
During pre-COVID-19 times, each of those casinos attracted around 200 thousand visitors every day. This extreme drop in visitor numbers is due to stringent border restrictions being followed since the month of March. Limited options for transportation and quarantine rules make it difficult for players to visit gambling destinations.
With the global economy now in recession, recovery will be delayed further. Although online casinos are well suited for safe indulgence in gambling in the midst of a pandemic situation, this sector is still fledging and is plagued with legality issues. Online casinos are illegal in most parts of the United States and in countries where online casinos are legal confusion over legal boundaries of betting and gambling is a chief restraint to growth. Underdevelopment online funds transfer platforms also adds another layer of challenge to growth. In younger markets like the U.S. and Asian countries where digital prize money disbursement platforms are still underdeveloped, the challenge is bigger and more difficult to overcome. In Europe, the region with a well-developed online and offline gambling infrastructure, casino owners are innovating in digital payments by using digital wallet services to transfer funds to customers.
Market to Make a Full Recovery & Reach US$159.3 Billion by 2027
A return to complete normalcy will begin only after barriers to access gaming destinations are completely removed. The market is projected to reach US$159.3 billion by the year 2027, trailing a CAGR of 3.7%. Offline Casinos, one of the segments analyzed in the report, is projected to grow at a 3.4% CAGR to reach US$116.3 million by the end of the analysis period.
Few of the factors expected to drive growth in the post pandemic period include migration from cards to crypto currency gambling; continued evolution of online casinos supported by rapid proliferation of mobile devices and growing penetration of smart phones and tablets; development of supplicated gambling apps; growing participation of women in casinos; resurgence in casino tourism; relaxation in gambling regulations and legalization of gambling in several nations given their contribution to national income and development of local tourism.
Key Topics Covered:
1. MARKET OVERVIEW
2. FOCUS ON SELECT PLAYERS
3. MARKET TRENDS & DRIVERS
4. GLOBAL MARKET PERSPECTIVE
Companies Mentioned (Of 151 Total Featured)
- 888 Holdings Plc
- Boyd Gaming Corporation
- Caesars Entertainment Corporation
- City of Dreams Manila
- Delaware Park Racetrack & Slots
- Dover Downs Hotel & Casino
- Eldorado Resort Casino
- Foxwoods Resort Casino
- Galaxy Entertainment Group Ltd
- Golden Nugget Atlantic City
- Harrington Raceway & Casino
- LC International Limited (Ladbrokes)
- Las Vegas Sands
- MGM Resorts International
- Palms Casino Resort
- Penn National Gaming, Inc
- Philippines Amusement and Gaming Corporation (PAGCOR)
- Resorts World Manila
- SJM Holdings Ltd
- Station Casinos
- The Strat Hotel, Casino and SkyPod
- William Hill PLC
- Wynn Resorts Limited
For more information about this report visit https://www.researchandmarkets.com/r/uqy0ll