Impact of COVID-19 on Canadian Gambling Industry

There have always been winners and losers in casinos, but since COVID-19 there have emerged clear winners and losers among not just players but the casinos themselves. The biggest names in the world of sports betting, online casinos, gambling resorts and bingo have all responded to the global pandemic in different ways, some much better than others. With tough health and safety precautions in physical casinos, ethical dilemmas faced by online casinos, and an expected global loss of several billion dollars this year - how well is the Canadian gambling industry likely to recover from the unprecedented health crisis? 

Online casinos sky-rocket, but face new challenges

Stuck at home and unable to visit physical casinos, many gamblers are playing online variants of their favourite games in place of the real thing, whether it be poker, slots or roulette. Online casinos have seen a surge in sign-ups during COVID-19, however their increased popularity has proved problematic within the industry and amongst regulatory committees. Some players who have signed up to online casinos are gambling less money than they usually do in brick-and-mortar casinos (online casinos typically allow for lower bets), the problem lies primarily with ex-players, or high-risk problem gamblers, for whom quarantine has been a period of temptation.

An additional concern is that casual gamblers, who might typically play online casino games only occasionally, may have found themselves playing more often than usual. Coupled with the fact that many have lost their main source of income in wake of widespread unemployment following the pandemic, this leaves certain players vulnerable. Lawmakers nd gambling regulation committees are concerned that there are not adequate safeguards in place to protect those who want, but struggle, to abstain from betting money during this time.

Responsibility and ethics have subsequently been at the forefront of many established brands’ revised marketing strategies this year. The more serious and established online casinos have typically set themselves apart from less professional brands by actively avoiding advertising which risks taking advantage of high-risk problem gamblers while they are at home. The UK Gambling Commission, alongside regulatory bodies in many other markets, have released advice for online casinos on how to protect high-risk individuals during lockdown.

A spokesperson from the Canadian online casino PlayFrank details their response to the problems posed by COVID-19; “We have earned a reputation of transparency and trust-worthiness in our years as a popular industry leader. These difficult times have allowed us to further demonstrate our commitment to a player-first mentality, ensuring PlayFrank remains a safe and fun place for as many of our players as possible. While complying with all Canadian regulations, we are also taking extra care to ensure vulnerable players are identified and contacted, and that the majority of marketing efforts are directed towards long-time players as opposed to new sign-up potentials.” (Source: https://www.playfrank.com/en-ca )

Physical gambling resorts badly hit, but recovery expected

From handling physical cash and touching slot levers, to mingling crowds and public bathrooms; brick-and-mortar casinos are potential hotspots for COVID-19 transmission. Like all other non-essential businesses, casinos have been closed during lockdown, and even as many of them reopen - gambling is not quite what it used to be. Canadian casinos are taking a variety of precautions in ensuring that the site adheres to health and safety requirements, while protecting their staff and players. 

Limits on how many players can be admitted, frequent sanitization of playing equipment, and wider spaces between gambling tables and slot machines are just some of many COVID-19 precautions currently taken in casinos across Canada.  Disinfection wipes are available at every gambling table and dealers are encouraged to wear masks, gloves and even plexi-glass eye shields. It’s not the most welcoming of looks - but Canada is enforcing these policies to minimize risk of transmission. As of now, most gambling resorts still see their ‘sister’ attractions closed down, including night clubs, spas and restaurants. 

Sports betting on the decline, future unclear

From the moment a wave of cancellations hit major sports events across the world in mid-March, a decline in sports betting naturally followed. With matches, races and games postponed - there has not been anything on which people can bet. Even esports (professional video gaming) betting have suffered, with its major tournaments cancelled this year.

Major televised sports is an important part of the global economy, and President Trump has expressed keen interest in ‘returning to normal’ as far as sports events are concerned. In Canada, there is no rush to send players back on the fields, where they will invariably be putting themselves at risk of COVID-19 transmission through close physical contact with other players.

For major sports to return to business as usual, a consensus has to be reached on how soon the industry can resume with games and which precautions are necessary to protect players and fans. Unless Trump has the backing of other important countries in the global sports industry, sporting events will likely be put on hold for a while longer - with a continued negative impact on sports betting.

Lottery and scratch card sales impact varies

Trends in scratch card and lottery ticket purchases since COVID-19 has varied across the world, and even within Canada the behaviour has largely been dependent on region. In Manitoba, lottery sales have dropped while scratch cards have one up. This could partly be due to the fact that scratch cards are easier to purchase at check-out in supermarkets. However there have also been reports of lottery winners left unable to cash out their winnings due to lockdown, potentially dissuading some people from buying tickets. The Canada Lottery Corporation has extended the claims period to combat negative press.

Industry’s B2B suppliers and vendors tackling uncertainties

At a time when the pandemic is ongoing and the global gambling industry does not look to experience a quick recovery, many major brands are unwilling to invest in technologies, enter new partnerships and purchase new software solutions. We will most likely see a stand-still in the growth of the gambling industry, as the less established brands - however innovative their products - will fail to secure funding and partners necessary to make a name for themselves.  

Even the biggest B2Bs, meanwhile, have suffered from the fact that many of their clients, partners and investors have not been able to financially recover from the impact of COVID-19, resulting in a loss of customers and revenue. With lay-offs, downsized budgets and changing workplace demands - business and entrepreneurship will suffer in the Canadian gambling industry as much as in any other entertainment industries that have seen significant restrictions and setbacks in light of the coronavirus.

Echoed across the Canadian gambling industry is the general consensus between players, game providers and regulators that we can gamble with money, but not with our health. As people accept restrictions in physical locations as the new norm, or replace brick-and-mortar gambling with an online equivalent, the industry is likely to make a slow but notable recovery. A prolonged negative impact on the economy, however, may result in less money spent. Recovery is guaranteed but not necessarily soon - nor in the form we’ve known gambling to take in the past decade.