It's important to note that in 2022, the largest betting website in Nigeria, SportyBet, with over 40 million site visits, only had 350,000 users.
From 2022 to 2023, 888Africa rapidly rose in the African market, successfully attracting over 1 million loyal users, marking its increasing influence in the region.
This milestone not only reflects the success of 888Africa in product innovation and market strategy but also highlights the enormous potential of the African online betting market, a true virgin territory for online gambling!
The acceleration of digital processes and the increase in internet coverage, along with the rapid growth of the African market, have enabled 888Africa to quickly win the favor of African consumers with its customized user experience and precise market positioning, establishing its leadership in the region.
Given the success of 888Africa, many operators are now paying attention to this largely untapped potential continent, eagerly entering the African online gambling market.
Today, PASA will delve deep into the decision-making layers of 888 Holdings, bringing you an insider's view on how the company seized the opportunities of this pristine continent and rejuvenated itself.
I. Opportunity
During the period of 2021-2022, 888 Holdings went through a dark time. Due to its aggressive expansion plan, after spending 2.2 billion pounds to acquire the non-US business of William Hill from Caesars Entertainment, it faced an economic downturn caused by Covid19.
The pandemic ravaged several major markets including the Netherlands and the UK, affecting offline venues.
This led to a 15% decline in the company's profits in the first quarter of 2022.
To make matters worse, during this period, the UK Gambling Commission's investigation found the company had social responsibility and money laundering shortcomings, resulting in a fine of 9.4 million pounds for 888.
At that time, 888 Holdings CEO Pazner commented, "I don't think this is a happy moment in history for 888, as we really see ourselves as a responsible operator, and we take customer safety, compliance with regulations, and meeting the highest standards very seriously."
Pazner also explained, "We fully recognize that there are some clear issues in the company's policies and procedures, which now need to be addressed."
It was then that the company made a significant decision—to enter Africa!
In March 2022, the company established 888Africa, a joint venture with six industry veterans, aimed at entering the entire African continent, hoping this emerging market would bring new growth to the company.
Seven months later, 888Africa officially launched in Africa, mainly focusing on Kenya, Tanzania, Mozambique, and Zambia.
According to data from 888 Group, in less than a year, 888Africa secured over 1 million customers in these four countries, and upon the deposit of the millionth customer, 888Africa's CEO Christopher Coyne stated, "Our goal is to become the leading content provider in all active African markets by 2027."
In 2023, 888 Holdings reported strong financial performance for the year, with revenues reaching 1.71 billion pounds, a 38% increase from the previous year. In terms of profits, the net loss was 56.4 million pounds, an improvement from the 120.5 million pounds loss in 2022.
It is evident that in this year alone, 888Africa has managed to reverse the declining trend with its strong growth momentum.
Subsequently, 888 Holdings underwent a major brand overhaul and was renamed "Evoke plc." The company plans to expand its platform to six to seven active markets in Africa by the end of 2023, and to eight by the first half of 2024.
II. Opportunity
The success of 888Africa in Africa is due to multiple reasons. According to estimates by 888Africa, the African market is expected to reach 5.6 billion USD by 2031.
When considering rapidly growing regions for online gambling and gaming, most companies think of the booming opportunities in Latin America.
In fact, according to population statistics by the World Health Organization, many African countries are experiencing extraordinary growth and will continue to do so for a very long time.
For example, by 2050, Nigeria will be the birth country for about 10% of all newborns globally, and Africa currently has the youngest population in the world.
In addition, many African countries are experiencing economic growth, with the overall economic trend in Africa significantly higher than the global average;
Therefore, more and more African regulators seem to be stepping up efforts, emulating the practices of traditional jurisdictions in other parts of the world. Especially in sports betting, which is very rapid, this is beneficial for the development of the gambling market, to attract more operators and suppliers to invest in its jurisdiction.In the past decade, online gambling has led economic growth in many regions, so emulating them will enhance the overall prospects of the industry across Africa.
With both users and regulations developing, the substantial growth of the African market is almost a certainty.
III. Challenges
Although the African market is a huge opportunity, it is not simple for new operators to succeed.
The overall diversity of languages and rich culture across the African continent is very important for operators to find the right entry point.
For example, three of the four countries chosen by 888Africa are English-speaking, which are more familiar with regulations, thus reducing some barriers for operators;
However, across Africa, suppliers still need to deeply understand the market, as methods that work in Kenya might not necessarily work in Nigeria.
Understanding the language, local culture, network infrastructure, and gambling preferences is crucial for localization.
According to the experience of 888Africa, the regulatory uncertainty in French-speaking countries is intensifying, and suppliers in French-speaking countries face more compliance challenges compared to more mature markets.
Additionally, the growth of internet penetration in French-speaking African countries is slower compared to English-speaking countries, with only some countries like Senegal reaching the African continent's average of 43%; moreover, the low usage rates of e-commerce and digital payments lead to an increase in black market cash flows, which not only affects the direct revenue of operators but also challenges the legality of regulations.
Therefore, 888Africa's Coyne also mentioned in an interview, "We expect to focus on expanding more English-speaking markets in the coming years."
Furthermore, whether the market is French-speaking or English-speaking, people on the African continent are more obsessed with football than Europeans, and they have a great interest in football betting.
Thus, 888Africa's online platform 888bet is also centered around sports betting. In fact, some African markets have already attracted some of the bigger gambling brands in the industry.
For example, brands like 888, Entain, BetikaHollywoodbets, and BetKing, without exception, all enter the African market with English operations and football betting as their entry points.
For resource-limited and savvy operators, these two key points must also be considered as a framework, choosing undeveloped countries, even if they are small, still have great potential, but the competition is not as intense.
The biggest challenge still comes from whether operators can adapt to localization.
Considering African culture, the average betting of Africans is basically on a weekly basis, which is very different from other continents; operators can build loyalty systems around providing weekly rewards instead of monthly rewards, and control them in real-time according to different countries and regions.
Plus, with infrastructure not yet advanced, smartphones not widespread, and high consumer data costs, operators are likely to incur high customer acquisition costs.
But fortunately, the number of mobile users in Africa is rapidly expanding, taking Kenya as an example, Kenya's ICT industry grows by an average of 10.8% per year, making it one of the fastest-growing in Africa's ICT industry.
In 2023, the total revenue of Kenya's telecommunications services reached 3.3 billion USD. It is expected that by 2028, the total revenue of Kenya's telecommunications services will grow at a compound annual growth rate of over 2%.
With the proliferation of smartphones, the mobile user base in Kenya is steadily growing. According to data from the Kenya Communications Authority, as of December 2023, Kenya had 66.7 million active mobile (SIM) users, with a mobile penetration rate of 131.9%, and a smartphone penetration rate of 66.4%. This also provides a good development prospect for operators.
Conclusion
Africa is not a one-stop shop, each country is different, ensuring products are liked by local players and continuously innovating.
For other operators hoping to enter Africa, it is necessary to refer to the success factors of 888Africa, and then choose a provider that can listen to your brand needs, focus on your operations and specific regional needs, and respond accordingly.
With a population close to 1.5 billion, Africa is at the forefront of a technological revolution.
The African market definitely has huge potential for development, which is also the fundamental reason why 888Africa has been so successful in this market, and it is believed that this region will eventually embark on a high-speed development path similar to Latin America.
Clearly, the entire African continent is still in the process of becoming more regulated, and there is still a long way to go to achieve the goals that other continents have achieved in recent years.
But Africa's speed and potential are also undeniable.
On this basis, coupled with lightweight, adaptable, and scalable technology, if operators can provide a simpler customer experience and user interface, and localize according to the needs and product preferences of African players, this will lay the foundation for their success.
We look forward to discussing more unique insights about online gambling in Africa with our readers and invite you to follow the global get-rich industry outbound information platform PASA for more firsthand get-rich industry information.
Welcome to subscribe to the official PASA channel: https://t.me/pasaqqzxzz
