What makes us so excited about sports? They are entertaining, competitive, teach the importance of physical and mental strength. But also there is now BIG MONEY in online sports betting in Africa. And we are talking billions here.
Let’s take a look at online sports betting markets in African countries like Nigeria, South Africa, Ghana and Kenya:
2014 Gambling Outlook Report released by PWC states that the combined online betting market size in Kenya, Nigeria and South Africa is projected to be worth nearly $37 billion by 2018.
Around 60 million Nigerians between the age of 18 and 40 years are actively involved in online sports betting. On an average, they spend approx $15 every day on bets. (Ref: News Agency of Nigeria (NAN)).
Government statistics show that more than half the adult population in South Africa is actively involved in online betting.
Why is online sports betting in Africa so big you ask?
1. Unemployed youth: Africa boasts of having more than 420 million people aged between 15 and 35 which is the youngest such demographic in the world. And as high as 25-40% of this is unemployed. Online gambling or online betting provides a “lucrative” way of passing time and is probably the only way they think of earning money.
2. Huge sports fan base: African youngsters are crazy for sports like Soccer, Cricket and Rugby. While the people and extremely active viewers, online sports betting in africa gives them another way to engage with the sport.
3. Rise of Mobile Money: Growth in mobile money (such as Airtel Money, Orange Money and M-Pesa) has given new ways for merchants to sell their services, especially, online betting companies.
4. Highly addictive: This is even more true for the youth.
5. Growing internet and mobile penetration has been instrumental in the rise of online sports betting in Africa.
How can you start an online sports betting business in Africa:
1. Registration & Licensing: Online sports betting is a closely monitored and regulated industry in Africa. It will cost you around $25k-$50k for getting necessary business registrations and licenses in countries like Nigeria, Ghana, South Africa and Kenya.
2. Technology platform: First you need a game engine or a betting engine. This provides you the core functionalities of online betting such as Tokenization, Game Ticketing, User management, Return to Investment (RTP) etc.. Another important thing to remember is how you achieve Random Number Generation (RNG). The methodology used for this must adhere to UK Gambling Commission Standards and you will need to get a certificate for this. The method we prefer is Mersenne Twister (MT) due to its excellent statistical qualities.
You will need to develop the website and mobile applications after getting the game engine developed. While the website is absolutely necessary, mobiles apps have become imperative too due to the high mobile penetration in Africa. These also tap into the impulsive betting nature of the user. Additionally, you can tap the users using feature phones by creating an app on USSD. Also, one of the biggest user base can be achieved through kiosks where an agent provides a Hand Held Terminal (HHT) to the user to play a game. The HHTs are built on android platform and combine payment and receipt printing in one small hardware itself.
We (Queppelin) have developed successful online sports betting games in Africa. Our clients include large European business houses setting up their betting business in Africa. Our portfolio includes sports betting, casino, bingo, eSports and poker. Write to us today at enquiry@queppelintech.com to see how we can develop these betting games for you.
3. Marketing: This is a make or break activity for any business. You might have the best of technology but a lack of proper marketing strategy will kill you. Africa is a different market than Europe & US and you will need a completely different way of thinking to penetrate this. This would translate into
a) Selecting the right keywords for seo and sem.
b) Creating advertisements that could start with local matches and then go on to international matches.
c) Selecting the right brand ambassador.
d) Partnerships with local businesses like telecom, mobile money players etc.
4. Funds: The potential of African online betting market is no secret now. This has made many venture capital and corporate investors very interested. You can get the investments if you can show a potential of right partnerships and have a technology partner who has delivered betting platforms in the past.
While the online sports betting market in Africa is highly competitive and the margins are tight, it has an undeniable profit potential if you can achieve volumes. If you are up for a challenge and looking to develop the technology platform for your betting venture, write to us today at enquiry@queppelintech.com and we’ll get you on right path.
Also read, What is iGaming?
