Africa is a huge continent that has a young, sports-enthused population. It’s not surprising then, that it holds great potential for emerging markets in betting. However, there are some hurdles to overcome in terms of regulations and payment.
Cyril Casanova from Honore Gaming, CEO of Honore Gaming, shared his experiences and provided insights into the African betting market with SBC Leaders. He highlighted both the potential for growth as well as the challenges in the market.
SBC: Can you tell us more about Honore Gaming? Which markets do you focus on the most?
Cyril Casanova – Honore Gaming has a solid presence in French-speaking African nations, especially in countries where French horseracing is popular.
Our footprint in Africa has always been French-speaking. We are very well-positioned there. We have focused our efforts over the past two years on adapting and making our platform more competitive in English-speaking markets.
Last year, we entered Nigeria and had deployments in Uganda, Kenya and Tanzania. We will also launch in South Africa once we have received certification.
SBC – What is it that makes African betting markets different from other emerging sectors?
CC: These markets are unique because of the underlying growth they represent, and also because there is a younger population that enjoys betting as an entertainment option. These are markets that offer very little entertainment options.
Because betting creates many jobs, it has an even more prominent image in Africa than other regions. There is also a great passion for soccer, and betting shops offer the opportunity to enjoy matches while providing additional entertainment.
The underlying organic growth rate of Sub-Saharan African industries is estimated at 20% annually, which is much higher than that for the entire global industry. Africa’s potential is great and it is undervalued, as with other African industries. There are many African nations that are more prosperous than Latam countries. This is why the European approach to things doesn’t always work.
SBC: What are the challenges you have faced in African markets?
CC: The lack of regulations is by far the greatest constraint. If a UK or French data feeder gives the incorrect information to a bookmaker and they offer the wrong odds for a match it is possible for them to be protected legally. In some African markets, this is not the case.
B2B service providers must ensure that their risk management is reliable or you could put your clients in an awkward situation. If you want to be successful in sports betting, your risk management strategy must include algorithms. You should also identify ways to reduce exposure. Otherwise, operators could lose a lot.
Integration of payment and API access is another technical challenge. It takes a lot of persistence to get the correct documentation, and it can often be a lengthy process. Africa offers a great market, with many opportunities. However, it can also be quite difficult.
SBC: Which countries offer the greatest potential for expansion by international operators?
CC: Markets with the greatest potential are those in the largest countries, such as South Africa, Nigeria, Ghana, Ghana, and Nigeria. They have the best regulation. These markets can be viewed as an opportunity to increase their growth by investors and operators if they are well-regulated.
The potential of Tanzania, Rwanda and Ethiopia are strong, along with Senegal, Senegal, and the other French-speaking newcomers to regulatory processes.
There could be a lot more M&A in the coming three-five years, with major American and European players who would benefit from greater regulation. However, there are risks with currency that may not apply as much to the US and Europe than to the US.
Combining the digital marketing expertise from the top betting companies in Africa with the online business could lead to another boom that will accelerate growth.
SBC – Are you concerned about the technology proficiency of African bettors and markets? Is the same true for other emerging markets as well?
CC: One common problem is the amount of bet slips. In some cases, you might pay 40 to 50 cents for a ticket, compared with EUR12 in France. This means that you must manage large numbers of transactions on a single platform.
It often depends on the person you work with. There are some weaknesses in local payments providers compared to international companies – you’re not dealing with Visa and Stripe.
Platforms in Nigeria, Kenya and other African countries are leading the charge in this region. These platforms are excellent from a technology perspective and, even though the bots and CRM are not as advanced as in North America or Europe, they are nonetheless very impressive.
SBC: How crucial is it that operators launch locally tailored and localised products in different African markets.
CC: While patriotism is an important concept, you also need to think about the number of local languages. While English, French, and Portuguese are the most widely used languages in official circles, there are many other languages that can be addressed.
If you are looking to reach multiple markets with your products and services, it is necessary that there be a high degree of customization. Operators must realize that all markets are different and need to be able to adapt their approach to features, bonuses, and promotions to retain and attract customers.
To be successful and increase brand awareness, you will need to incorporate a lot of products to make your brand more credible and strengthen the product’s seriousness. Payment methods, which are nearly always local, can be referred to as well.
SBC: Football is Africa’s most loved betting product. But are there other sports that consumers are interested in?
CC: Although football is the most popular betting product in the world, horse racing is much more popular in France-speaking Africa than in English-speaking countries like Nigeria, Ghana, and Tanzania, with the exceptions of South Africa.
There are many emerging sports, other than football. However, they are growing in popularity, yet still represent a small percentage of the activity.
Although soccer is a passion, people don’t place as much money on it than they do on other events, such as the Euros or World Cup. We recognize this is a challenge, so we will be focusing more on the pricing of these tournaments to increase awareness about what you offer as a local product.
SBC – Your opinions about the African igaming market? Are there opportunities for growth and cross-selling with other sports betting professionals?
CC: Casino in Africa offers many possibilities, but this requires regulation. While many countries have not yet regulated, we see the potential for vertical accounts to account for 30% of all betting activities in the countries with legislation.
This is an excellent way to get people online and offers a product that can be used in countries with less casinos. Once regulation is in place, the casino will become Africa’s next big thing.