As betting markets across Latin America (LatAm) continue to undergo a series of regulatory changes, Alexandra Kalchuk, Chief Business Development Officer at BetInvest, reflects on why the market can be the ‘land of opportunity’ for those looking to grow into new markets.
For those companies eyeing new opportunities within the sports betting industry, LatAm is often a key focus of discussion. Often described as a ‘prosperous’, ‘highly promising’ and ‘abundant’ market, it is widely accepted as an appealing market for any gambling business that wants to broaden its geographical presence.
But putting these glowing descriptions aside, it is rare that we elaborate on the reasons as to why LatAm is, essentially, a high-paying asset that can generate new revenue streams for betting and gaming companies. The market has the potential to become the main operating region of any gambling provider ‘with little to no effort’.
In recent months, the region has undergone a series of regulatory changes and developments – you just need to take a look at Argentina and Brazil to gain an insight into how far the development of gambling legislation has come this year.
This progress shows no sign of slowing down. The more mature markets that previously attracted hundreds of businesses on a monthly basis – such as Europe – are now overloaded with supply that drastically exceeds demand.
In these conditions, only the largest providers are able to survive the competition, while startups and medium sized companies are forced to search for alternative solutions. This is where LatAm comes in.
According to the latest statistics, the two biggest LatAm countries – Brazil and Mexico – are listed as the fifth and sixth countries with the highest number of regular internet users. The region as a whole accounts for 469 million regular Internet users. If the statistics are anything to go by, LatAm is absolutely ready to accept newcomers to the sports betting market.
LatAm is a land of opportunity for all kinds of gambling businesses. The main reason why the region became so appealing in recent years is down to the unique combination of an undersaturated entertainment market and the socio-economical state of the population.
The numbers give a clear indication of the opportunities within the market. By understanding that gambling facilities are an integrated part of the local culture, a well-thought marketing campaign will allow startups and medium companies to turn this potential into profit.
However, entering LatAm is not going to be plain sailing, and there are a number of intricacies which must be considered and understood first.
There are very few LatAm countries which can brag about a well-defined gambling regulation and taxation system. This is on top of a number of countries which haven’t updated their gambling laws since the 1950s; not understanding this can have wide-spread consequences.
It’s not all grey-markets and uncertainty though. There are glimpses of hope – take Argentina and Colombia for example. Argentine and Colombian gaming law systems are listed among the most liberal in the world, which made those countries the favorite vacation destinations for players from neighboring regions.
It is especially ironic since the Colombian population is a quarter of the size of Brazil’s population, yet, the Brazilian players generate up to 50% of revenue for some particular gaming facilities located in Colombia.
But, amidst the legislative chaos, there is a window of opportunity for those providers who want to establish their online presence in LatAm.
To enter the local market completely legally, a business should focus on those markets where online gambling operation is regulated in the same way as it is for land-based gambling – Argentina, Colombia and Uruguay, with some possibilities for operation also available in Mexico.
But despite some countries still being governed by antiquated legislation, we are hopeful that the regulatory success stories in neighboring countries will influence Brazil and Mexico so that, soon enough, betting operators will be allowed to set up shop.
LatAm is not one homogenous region, and it should not be treated as one. Culture, acceptance of gambling and – most importantly – language all differ from country to country. For international operators, this can make ‘entering the LatAm market’ more difficult than initially expected.
While Spanish is the most widely used language in the region, Brazil primarily uses the Portuguese dialect for communication. Its variations pose a certain challenge for gambling operators. For example, European Portuguese uses the word ‘rapariga’ when referring to a girl. However, in Brazil, this can be translated as ‘prostitute’.
Therefore, to properly localize a business, we advised companies to utilize particular translators with a deep understanding of the local culture. To meet the needs of the varying demographics across LatAm, an operator will require the following localizations:
- Mexican Spanish
- Rioplatense Spanish
- Brazilian Portuguese
- Colombian Spanish
Cultural acceptance of gambling is also a topic for contention across the region. Sociological surveys have suggested that younger demographics consider online gambling to be a fun pastime, while a majority of older people regularly stake their money as a form of entertainment as well as a culturally acceptable hobby.
So what does this mean for those eyeing new opportunities in the market? To start operating in LatAm, a gaming provider must have a deep understanding of the particularities of each diverse region.
At BetInvest, we can offer our assistance and advice for those that are considering the new opportunities in the ‘unknown yet magnificent market of LatAm’. As a company, we have already opened the door to LatAm for at least a dozen international gambling companies.
We know how to enter the local market effortlessly and start offering gambling services to loyal players almost instantly. Our products consist of a variety of the most sophisticated technologies, both from security and user convenience specifics. Simplicity, control, broad analytical tools – this is how our products are characterized by our customers.
Our experts will equip your business with everything needed for a long and fruitful expedition to the LatAm market. We will gladly consult you on the topic and offer you the optimal solution for your particular business case!