From the glorious savannah’s of Africa to the wonder’s of India and gold rush presented by the land of opportunity, delegates at SBC Summit Barcelona were treated to a rapid fire flash around the globe during an emerging markets discourse.
Despite referencing a multitude of jurisdictions that covered three continents, Claire Osbourne, VP of Interactive at Inspired Entertainment, kicked off the discussion by stating that “nothing really beats the US at the moment”.
“The three large states in the US from an eye gazing perspective outstrip all the other markets, apart from the UK,” Osbourne began.
“It is the biggest emerging market” she continued, before noting that, for Inspired, India is “probably at the end of the queue” with Latin American being “the closest watching brief”.
As the panel made references to LatAm prospects as well as the opportunities offered across CCE regions, Osbourne spoke of hopes for a further Canadian roll-out before pinpointing a potential barrier for entry regarding certain US states.
“Yeah, sure. I guess it’s not just the US, it’s North America as a whole,” she explained. “Obviously, Ontario, opening up has been slower than hoped. But I think that will probably, eventually, lead to the rest of Canada, hopefully going down a similar model.
“…you’ve got to take into account that not every state is equal”Claire Osbourne, VP of Interactive at Inspired Entertainment
“And if British Columbia opens up next, which is potentially the next one that might happen, within that one to three year timescale, I think that potentially becomes a very large market as well.
“But if you look at obviously, on the igaming side, there’s only really five states, three of which are incredibly financially viable, the other two are on the edge of whether or not you’d bother.
“So I do think that when you’re looking at the US, you’ve got to take into account that not every state is equal.”
Adding: “So one of the barriers to entry in the US is obviously you need the licence. But you also need to put in datacenters, like Connecticut is the first state that moved away from that, and Connecticut allows you to serve from Interstate, if future states opening up do the same, the US becomes that slightly easier.”
As Markus Antl, Head of Sales and Key Account Management at Greentube, backed-up the data centre issues, Gonzalo Rosell, CEO of La Tinka, delved into the opportunities presented across Latin America.
As well as highlighting “several markets” that are growing, Rosell cited numerous countries that could be considered to be grey markets that are proceeding down the regulated avenue as evidence that the region represents a good growth story.
“the best strategy is to be first in the market and to take advantage”Sergey Potapov, CEO of Cosmolot
This led into a discussion regarding the challenges presented when targeting entry into fresh jurisdictions, with Rosell highlighting that retail assets, particularly in Peru, are “a very good asset [that] allows us to compete pretty pretty well with anyone”.
Sergey Potapov, CEO of Cosmolot, pointed to the importance of local expertise in it being “very difficult” to compete for fresh entrants; confidently adding that “I don’t believe that another international company would beat us”.
Taking the reins, Aleksandra Sygiel, Director of International Development at Pinnacle, elaborated on the advantages and disadvantages of a market being dominated by local actors.
“I think the main advantage is that trust, and the main handicap that international business have is that we try to build a scalable business, which in practice translates into how much of what we already have, can we reuse and usually there’s that catch 22 when we don’t want to invest that much in localised solutions, because the market isn’t bringing as much revenue yet,” she noted. “But it’s not bringing that because it’s not localised.
“But I do think there are two opportunities, there are two ways of tackling that kind of market for international operators based on its economy of scale.
“So someone is happy to be losing, and I know many of us are, as it seems, are happy to be losing money for an extended period of time and have put up that fight. And second is a differentiated product”.
As Osbourne noted that “local suppliers will always know the market the best,” Antl took to the plate to highlight the importance of planning properly as well as illustrating that the M&A route should also not be discounted when it comes to such growth.
In addition to pointing to the importance of legacy land-based operations, Potapov simply suggested that “the best strategy is to be first in the market and to take advantage of the time and the strengths of the brand”.
To end, moderator Petra Zackrisson quizzed the panel on what the key ingredient is to ensure success upon entering a new region, with trust, localisation and payments all stipulated as forming a crucial piece of the pie.