With a young and rising population that currently stands at 1.2 billion, Africa would seem to offer operators unrivalled opportunities. But tailoring an offer to what is seen by many as a ‘mobile- only’ market presents a unique set of challenges, writes Joanne Christie.
In recent years European operators have increasingly been promoting their products and brands as ‘mobile-first’, in recognition of the fact there’s been a huge swing in player preferences away from desktop towards mobile.
In Africa, it’s barely even a choice – for brands wanting to attract online customers it’s not so much a ‘mobile-first’ market as simply a mobile market. While it’s difficult to generalise across a continent with so many different countries, it’s fair to say the majority of African operators’ gambling business is coming from either mobile or retail, with desktop barely getting a look in.
“Across Africa there is that leapfrogging phenomenon where you have millions of people whose first experience of the internet is via their mobile devices and they have yet to ever experience internet via laptops or PCs,” says Sudeep Ramnani, CEO at SportyBet, which operates in Kenya, Nigeria and Ghana and is soon to launch in Tanzania.
At first glance, the numbers look great. Africa has a population of 1.2 billion people, it has the youngest population in the world and it also has the fastest growing mobile market, according to Groupe Speciale Mobile Association (GSMA).
But mobile in Africa and mobile in Europe are two very different things. Even in South Africa, the African outlier in many respects with an advanced industry more akin to European markets than the rest of the continent, operators face challenges that are very different from those they have to overcome in other parts of the world.
“The big difference between mobile in Africa and South Africa compared with Europe is what I would call data or broadband scarcity,” says Scott Canny, CEO at South African operator BET.co.za. “Data is really expensive in Africa, even more so when you think about it relative to income, so the product that you use needs to be light on data, which is pretty hard. When you look at a traditional European sportsbook with thousands of matches and thousands of markets and cool little visualisations and pieces of technology, they all use up data.”
For regions such as Africa, tech giants such as YouTube and Google have designed lightweight apps that use less data. Now Dolan Beuthin, founder and CEO of BestBet360 and PlayKwik, new sites soon to launch in Nigeria, Kenya, Tanzania, Zambia and the Democratic Republic of the Congo, reckons igaming firms would be wise to also adapt their products to the more basic nature of the Africa market. “It is taken for granted in Europe that you will always get a decent mobile network or decent internet connection,” he says, “but in Africa you’ll often find that you have got shocking internet connection and very slow speeds and as a result of that the games don’t display correctly.”
Indeed, in a report entitled The Mobile Economy: Sub-Saharan Africa 2018, GSMA estimates that mobile broadband covers only about two-thirds of the sub-Saharan African population, with approximately 400 million people unable to access coverage.
This has severely limited the growth of some types of games across the continent. Virtual sports, for example, have proven popular with sports-mad African punters but the bandwidth and streaming requirements of virtual games have meant they are not easily accessible on mobile devices. Hence they remain largely limited to the retail environment.
Unfortunately, says Beuthin, this type of problem is something developers often struggle to comprehend. “Africa is still very third world in a sense and a lot of game developers don’t understand that. They are developing for the first world, they are developing for Europe. They have to change their product for Africa and adapt it.”
This is particularly true when considering many people in Africa are also using much older phones and operating systems than would be found in more developed parts of the world. When combined with the fact that most African countries have vastly different payment systems to developed countries, this means localising offerings to take all these factors into account is key to success for operators.
For example, Canny says Betway and SportPesa have thrived in Kenya due to the fact they latched onto local market trends. “They were very quick to capitalise on M-Pesa, the mobile money system out there, which makes it very easy for people to transact using just their phones.
“Also, Europeans might see things like USSD and SMS as primitive technologies but they have really innovated in the space and used older technologies in a really smart way to get to a market that doesn’t necessarily have smartphones or online banking.”
According to Ramnani, SMS is also an important marketing tool, along with utilising the opportunities provided by retail outlets. “Having a retail presence does strengthen you on the street as you have that outdoor branding,” he says.
Dhrupal Amin, managing director at G-Bets, which operates in South Africa, Lesotho, Mozambique and Tanzania, says operators need to remember that there can be wild variations between what works in one country and another. Thus operators adopting a pan- African strategy must be prepared to adapt their marketing strategies accordingly. “South Africa in a sense has a lot of what you’d expect in Europe, where you can do multichannel marketing. If I look at a place like Mozambique, where we are currently marketing across major channels – we are doing TV, radio and traditional press – there is a very different infrastructure. It is not as organised and doesn’t speak to everyone in a way that a more mature market speaks to them.
“In Mozambique, because we are new entrants it is trial and error. For example, we’ve seen some success with TV but not so much with traditional print media. Even though the distribution is wide we are not seeing that benefit.”
Expanding beyond sports
While country-by-country localisation is clearly a vital component of success for those competing in the currently betting-focused market, a broader localisation effort is needed to expand the continent beyond the sports betting vertical. While traditional sports betting has already taken steps into virtual sports, lottery betting and in-play betting in some African markets, so far the casino vertical has yet to make any significant in-roads in the continent.
But it is set to make great strides in the coming years, predicts John Kamara, director at Global Gaming Africa. “Consumers are really looking for the next thing. They are enjoying their sports betting, but you can see they are slowly learning about other things. My prediction for the next three or four years is that online casino is going to be the next revolution.”
Partly, casino has been held back because its legal status is less clear than that of sports betting, particularly given that in the region’s most established market of South Africa online casino remains illegal. But it has also been held back by operators putting the wrong proposition to punters, says Beuthin. “You need to start with very basic games and very simple games and I think that European providers offering their games have given the operators far too sophisticated offerings.”
But like Kamara, he is optimistic about the vertical’s future. “Casino is still bigger than sports betting across the world and as soon as the market gets educated here, and again there is the matter of internet connection and data costs, as soon as all those hurdles are overcome I think casino will be a good vertical.”
With rapid innovation in the areas of fintech, regulation and connectivity in Africa, it’s clear there’s plenty of untapped potential when it comes to mobile betting and gaming on the continent. But tapping into that potential requires much more than a boilerplate approach – companies wanting to expand into and across Africa need to tailor their offering carefully to succeed.