So, you’ve seen the exponential growth of online casinos and you are thinking about starting an online casino business. But before we move to thinking about purchasing Ferrari’s and Porsche’s, there are a lot of challenges right in front of you.
First of all, you cannot start an online casino business on a budget. Even if you have the money for the online casino software and license, which can go up to $150,000-$200,000, and it some cases more, you are still subject to regulations, and regulatory bodies will audit your company just to make sure that you have enough money to hand out wins and to start the business.
So, you’ve already spent a quarter of a million, and your online casino is nowhere near up and running. Then you have marketing costs, which can go as high as $200,000. After all, this is a competitive scene and you have to invest money in order for new people to try your services.
This means that the barrier of entry is quite high, but not impossible. We all want to build a casino empire like DraftKings, but that usually takes years, if not decades, and lots of money. To learn more about their story, check out this DraftKings online casino review by hoopcasino.com.
Starting an online casino is profitable right from the start, as long as you have customers engaging with your games.
We’ve seen many newcomers in the industry who made a strong name for themselves over the past couple of years, so why not you do the same?
Let’s see what CEOs have to say about building a casino empire.
Step 1: Understanding the Legal Landscape
The first step is always the labyrinth of legal requirements. This depends on your casino location or the target market. Therefore, you need to apply for the right license, which often requires a detailed business plan, ownership structures, and financial projection. As we mentioned before, you will be required to prove that you have enough money to start an online casino.
This process can take from a few months up to years depending on how complete your application is.
Step 2: Developing Your Casino Platform
Once you’ve obtained your license, it’s time to develop your casino platform. There are a few things to consider here, such as:
- Design
- Functionality
- Security
Online casinos don’t design their own games, so you don’t have to worry about that. Your only concern at this point is to create a good-looking website, that is functional, and has all the necessary information, like customer support, knowledge base, sign-up forms, etc.
The design of your website should also be smooth and functional. This means quick load times, which usually means an expensive dedicated server. After all, nobody likes a clunky interface, especially not in the world of online casinos.
Next, you have to worry about making sure your website is bulletproof. We live in a digital world full of scammers and the rise of cybercrime, so you want to create a safe environment for players. Check out different security options that will protect your data, do daily backups, have malware protection and SSL encryption.
Step 3: Choosing the Right Software
Now comes the fun part, games! But make sure you set the priority to efficiency, functionality, and quality. Choosing a robust and reliable casino software is one of the most important aspects of the business.
The software will indicate the type of games your casino will include, which is kind of the selling point of every casino.
Step 4: Implementing Effective Marketing Strategies
Now you have a functioning website where users can sign up, deposit some money, and play their favorite games. Just when you think that the hard part is over, you receive a big hit. Most people think that customers will start magically appearing in their casino, which is absolutely not true.
In fact, new casinos have to spend a lot of money on promoting their services after they get their first clients. This means that you should be ready to spend some money on marketing without any return for months.
When it comes to marketing strategies, most new online casinos use social media as a starting point where they can get a higher organic reach (free). They also target specific audiences in market locations using paid ads.
They also jump into SEO, which is quite important for a casino. SEO can dictate your page authority or in other words, how it ranks on search engines. They deploy link-building strategies, PR campaigns, target specific keywords, and much more.
Some online casinos even go for affiliate marketing and influencer promotions, which is a great way to reach new potential clients. This has been very popular on video streaming platforms like Kick or Twitch.
Step 5: Ensuring Compliance and Security
Ensuring compliance with gambling regulations is non-negotiable. Stay updated on legal changes and maintain transparent operations. Implement advanced security measures to protect against fraud and data breaches. This includes regular system audits and compliance checks.
What Do CEOs Say About The Online Casino Business
A Humble Beginning
Most online casino moguls didn’t start with a silver spoon. Take Hector Fernandez, the CEO of Aristocrat Gaming, for instance. He started during a period of economic downturn and saw an opportunity where others saw risk. He believed in the resilience of the gaming industry, a sector that has consistently bounced back from economic slumps.
Breaking Into The Market
How do you turn a fledgling casino into a market leader? It’s all about strategy. Troy Zurawski, CEO of Design Works Gaming (DWG), emphasized the importance of data. When DWG entered the competitive New Jersey market, they meticulously analyzed performance data from their land-based and European operations to choose the best games for launch.
Economic Challenges
The gambling industry isn’t immune to economic fluctuations. According to a report from the American Gaming Association, the industry saw slower growth in 2023 compared to the previous years. However, the outlook remained positive, with expectations of moderate growth in 2024.
