The way online casinos make profit
By today, online casinos are rapidly gaining popularity on the Internet. There are also an increasing number of gambling sites and players willing to have fun and push luck. The Slotegrator’s experts point to several main reasons why these trends will be developing further:
Naturally, the profitability of online gambling establishments is also constantly growing. But what does it consist of? What does affect it? Which types of activities on the online gambling market are more profitable and which are less? The answers to these questions are presented in this review by Slotegrator.
What is the most profitable for online casinos
The online gambling audience is considered as very extensive; however, the main income is brought by respectable customers who are ready to spend impressive sums on the gambling. These players are especially appreciated, being given a lot of VIP privileges.
If you consider the very principle of money circulation at the gambling establishment, you can see that they pass from hand to hand. Someone loses while someone wins, but no online casino will be left with nothing. The most common methods of profitmaking are claimed to be the casino’s advantages over the players and various commission payments.
Slots and poker are turn up as the most profitable games at online casino. The reason for this was purely and simply that they are the most demanded types of gambling on the Internet. Roulette, blackjack, baccarat, and keno can be put on the second place.
Therefore, each online casino tries to maintain a wide range of the most popular types of gambling. And it also does everything possible to attract players’ attention, applying various marketing programs: tournaments, promotions, drawings, bonuses, etc.
Types of online casino income
Conditionally, all online casino games can be divided into two types: player vs. casino and player vs. player. In both cases, the online casino will receive its profit; the only difference is in what way they will get their benefit.
According to the first way, online casino uses a programmed RTP (Return To Player) – means a percentage of return. Also it profits of each player's loss.
Due to the second type of games, online casino takes its fixed payment - rake for each bet. This applies to poker, as well as to such board games as billiards, dominoes, etc.
In general, the structure of the online casino income can be represented as following:
Let's consider in detail all possible types of online casinos profit.
RTP is the percentage of payments, determined by the developer of slots or board games. In this case the probability of winning is generated by using the built-in random number generator (RNG) algorithm. It is used while playing against a casino: for example, slot machines, roulette, or keno lottery. Sometimes, specific casinos can slightly change this percentage. But it occurs very rarely and must be coordinated with the developer of game content.
Earnings on player’s loss
Online casino also makes profit on player’s loss. For example, live casinos are based on such mechanism of receiving a profit from games with live dealers but without random number generator. It is also used in baccarat and blackjack.
In addition, online casinos receive a certain percentage of every win. Therefore, it is advantageous for a gambling establishment to have an alternation of wins and losses.
Rake is a fixed commission, determined by online casinos. It can be expressed as a percentage of the poker pot or each bet. Usually, it does not exceed 3-5%. Also, rake as an entrance fee is charged in such board games as billiards, dominoes, etc., where a player turns against another one.
Online casino’s competitive advantages over the players
No matter how the events unfolded – a casino will always have an advantage over the player.
The first benefit is that there is always a difference between the real conditions for winning and the money received by the player. As a rule, an online casino takes a commission of 2 till 5% of the winning amount. In other words, player is never paid 100%, instead he gets only 95-98%. Therefore, online casinos have a significant profit, no matter how many users win or lose. The more the number of games played, the higher the profit.
The second online casino privilege is about the structure of some games. The same blackjack allows the gambling club to turn into an active player. And all the nuances set by the rules of the game give a significant advantage to the croupier. For example, a player opens the game instead of a dealer. And if the client picks up the same number of points or takes in excess - the dealer wins, even without playing with his cards during the game.
The third advantage is the collection of mandatory payments. This includes rakes, fees for participation in tournaments and various membership payments, for example, at poker rooms.
What determines the profitability of online gambling houses
The profitability of online casinos is affected by various factors. There are several main:
The profitability of online casino depends on the number of visitors and the amount of time spent on the site. Therefore, many gambling resources develop special marketing programs with the purpose of attracting and retaining high traffic, giving to the players an opportunity to play for free, first deposit bonuses, etc.
With the development of mobile Internet and the ubiquitous use of tablets and smartphones, online casinos must necessarily have mobile versions for various platforms. Then customers will be able to come and play at any time, doing this literally on the move, which will also affect the increase of the profitability.
In addition, the gambling profit depends on frequency and amount of replenishments by customers. To increase these indicators, operators develop various marketing programs, which increase deposit if it is not less than a certain amount, various bonuses, and privileges for replenishment.
In addition, we can distinguish several other factors, which in the aggregate are also quite important and have a serious impact on the profitability:
- Reduction of the time interval from the moment of registration to the moment of deposit made by player.
- Convenience of account replenishment and withdrawal of winnings: support of all major payment systems, bank cards, and cryptocurrency.
- Information presence and SEO: reviews, recommendations, participation in ratings, and reviews on various thematic resources.
- Site usability: an intuitive interface, a large selection of games causing the player's interest and desire to play again.
But the most important thing, which the profit of online casino depends on, is its decency and honesty towards the players. First of all, the reputation determines whether the gambling site will have regular customers and receive a stable income.
Day-fly casinos and fraudsters
Despite the fact that current gambling on the Internet has significantly cleared of the criminal component, still there are many online sites continuing to engage in cheating by issuing real online casinos.
Nowadays, a large number of free scripts can be found on the network allowing the fraudsters to create online casino emulator sites. This is done to deceive visitors and profit from their deposits. But that is not the only dangerous thing. Fraudsters also receive bank card numbers and codes with customer personal data, giving them access to funds on players’ accounts.
It is almost impossible to win at such online casinos. RNG of slot machines and board games is not practically available, since they are fully fit a gambling establishment. Often there are huge prize pools of jackpots or tournaments offered, but for participating in them players are charged with impressive entrance fees.
Such casino-fraudsters are considered as day-fly establishments existing during short period of time. After receiving a sufficient profit they are closed, and then, as a rule, they appear anew under the guise of another gambling site.
It is possible to distinguish an honest gambling resource from fraudulent one in several ways:
- It is necessary to pay attention to how long this online casino exists on the Internet, its reputation and popularity.
- The operation of an honest online casino will necessarily be licensed, and gambling content will be certified. Information about online casino license is publicly available.
- In a reliable establishment, all tournaments, drawings, and jackpots have necessarily a real prize fund and do not require large sums of money as a contribution for participation.
According to research of the TechNavio company, the rising trend of online gambling will continue until 2020 at an annual rate of about 11%.
Online gambling, according to a number of research companies, now yields an aggregate income of over $37 billion a year. More than 85 countries around the world have legalized online gambling, and many of them are closely involved in changing of legislation to regulate this fast-growing industry. Thus, all trends contribute to the further expansion of the global online gambling market.
Experts of Slotegrator emphasize: the online gambling industry is growing so fast that it is very difficult to record world statistics, because changes occur literally every day. And for online casino operators, it's very important to be in the trend in order to get the maximum profit from their business.
Slotegrator notes that online casinos are not the only profitable direction of online gambling. Popularity is also gained by online betting business, fantasy and e-sports. The last two directions, for example, in the US and in several European countries, are already virtually on a par with football, basketball, and other popular sports. This also opens up opportunities for online gambling market operators to expand their territory of operation and increase the profitability.
Read also: How to develop and promote an online casino