Social Gambling: The Industry’s Present and Future
The relevance of “freemium” casinos is growing every year. Today, it is an important part of the gambling sector with high capitalisation and a huge number of fans all over the world.
What is Social Casino
This is an application or website where people can launch products using virtual coins.
Platforms of this type offer customers free bonus funds (chips, tokens, or spins) every day, thanks to which it is possible to place bids. As soon as the currency runs out, people can continue spinning the reels by purchasing additional credits.
Such entertainment portals owe their appearance to classic video games, as well as bets on traditional wagering sites. Social networks also played an important role in the development of this option. These are Telegram, Facebook, Viber, and other well-known resources with a multi-million audience.
The first platforms appeared in the mid-2010s, which coincided with a surge in the popularity of mobile betting applications. Similar trends persist today. About 70% of logins are made from smartphones and via Apple technology.
In April 2020, a concert by rapper Travis Scott was held in the famous Fortnite social game. A large-scale show called Astronomical gathered more than 12 million players. Several million more watched the event in the recording.
This fact once again confirms the audience’s universal love of such solutions and the fact that this format has excellent prospects.
The Difference Between Online and Social Casinos
Let us consider the key distinctions between these 2 areas:
- Payment. The second option does not involve playing for real funds. Here, all spins and rounds are launched using virtual credits that have no real value. Traditional websites require a deposit, without which it will be impossible to spin digital reels.
- Legalisation. Due to the lack of bets for money, free casinos do not fall under the category of classic entertainment. Therefore, to launch them, operators do not need a licence or any other approvals from the corresponding authorities. For example, this is the opinion of the UK Gambling Commission. The presented report demonstrated that social betting does not affect the development of ludomania and, therefore, does not require permission.
- Availability. The lack of legal requirements provides seamless access to free solutions. You can place bids on popular messengers (for example, Facebook) or mobile applications (available in the App Store or Play Market). There are also no restrictions on the amount of wagers or time spent on the website.
- Socialisation. These casinos focus on the connections with the community, rather than on winning jackpots. Such platforms support a multiplayer mode and please users with an abundance of tournaments, leaderboards, as well as quests, or other tools to attract and retain clients.
All these aspects make these projects popular among customers. For example, they are available to people who cannot visit traditional digital resources for various reasons. These are personal circumstances, religious beliefs, government restrictions, and other factors.
The Monetisation of Social Casinos
They function on the “freemium” or “pay-to-win” model. By offering clients free games, entrepreneurs unobtrusively motivate players to spend real money in exchange for additional bonuses and features.
Internet traffic is commercialised in 3 directions:
- 69% of such locations earn thanks to in-app purchases;
- 30% receive income through the publication of advertising blocks;
- 1% generate profit via the sale of paid applications and subscriptions.
Most social casinos perform monetisation through the implementation of in-game options. These are VIP accounts, chips, character skins, closed rounds, exclusive avatars, unique opportunities for heroes, and much more.
For this reason, a free session rarely lasts more than 30 minutes. As soon as clients run out of virtual coins (lives or tokens), they are forced to spend money.
Advertising blocks are the second most popular method. Operators offer players the chance to watch marketing videos in exchange for various incentives. This makes promotional messages less intrusive: both the users and the project owner benefit.
The White Label scheme is a universal approach for social game developers. The company that released the content can monetise it through branding. Any entrepreneur has the right to buy or rent the product, bringing additional income to the software vendor.
Popular Freemium Solutions
Depending on the theme and plot, the content can be divided into the following categories:
- arcades;
- construction of objects;
- quests;
- cards, lotteries, and bingo;
- poker;
- slots.
As a rule, social casinos offer different types of products to meet the needs of all groups of customers.
Some punters prefer multiplayer solutions with a clear competitive effect. Others like to meet a virtual dealer face-to-face. Such users choose cards, bingo, and video slots.
In 2023, the Newzoo online publication conducted a study of the social entertainment market in 3 countries: the US, the UK, and Australia. The data of clients aged from 18 to 70 years who placed bets in “freemium” casinos over the past 6 months was analysed.
Results of the research:
- Slot machines are the most common kind of content. More than half (53%) of respondents opt for digital products. Users prefer fruit-themed mixes and games dedicated to animals, myths, fairy tales, and other topics. There are no clear leaders among the manufacturers, primarily because of the high competition in the industry.
- Poker is the second most popular type of entertainment. In Australia, 26% of respondents regularly play in free locations. In the US, this figure is 19%, and in the UK, 20%. Such series as the World Series of Poker and Poker Face are extremely in demand.
- Bingo is the favourite category of content among residents of the United Kingdom. 26% of survey participants regularly try their hand at this game. Bingo Blitz is considered the front-runner. About 46% of revenues in the segment are accounted for by it. Top products also include Bingo Party, Bingo Story Live, and Bingo Bash Featuring Monopoly.
- 57 minutes is the average duration of sessions in social casinos. As a rule, one player spends $39.87 per month on purchasing in-game tools (skins, avatars, and VIP access).
- $324 is the average LTV among visitors to free platforms. Customers named these mechanics the main incentive that keeps them on the digital resources. 64% of the audience returns to the portals for new achievements and higher positions in the tournament table.
Why People Visit This Type of Casinos
The main reason is a powerful social aspect. Users like to compete with each other, communicate in internal chats, hold the lead in quests/achievement races, and share results in messengers.
Practice shows that more than 50% of visitors to “freemium” portals subsequently switch to paid games. They are motivated by the opportunity to become part of the leaderboard, leave their rivals behind, or get access to VIP sessions.
Let us consider why the audience likes social entertainment:
Dynamic Gameplay
The content is characterised by a long storyline, a variety of rounds, and a large selection of characters. People can customise the skins and functions of protagonists, change the location, and launch mini-rounds.
According to the GameRefinery online publication, the top 5 most popular freemium mechanics include:
- regular live events (presented in 100% of top projects);
- irregular live solutions (93%);
- progressive jackpots (93%);
- piggy bank (87%);
- dynamic tournament table (80%).
Generous Reward
For example, in social video slots, the RNG produces results in the range of 75 to 125%. For comparison: traditional land-based slot machines operate based on the RTP percentage of 75–90%. Thus, products with an excessive indicator give gamblers the feeling of a quick completion of rounds without much effort.
Flexible Loyalty System
Active users receive:
- daily gifts;
- rewards for achievements;
- referral bonuses.
Players participate in tournaments/races, try their hand at games of skill, as well as earn points for the number and duration of sessions.
Social casinos often include albums in which users can collect various items. The popularity of this feature gives people a sense of progression and performance of new tasks without disturbing the game balance.
The Modern Social Entertainment Market
Its income has been increasing steadily for 2 decades. For example, in the US, such content is the second top-grossing category of mobile products. About 17.2% of all income in the App Store American online store is accounted for by the niche.
According to The Business Research Company online publication, in 2023, the segment’s profit reached $7.39 billion. According to experts, by 2028, GGR will be estimated at $11.2 billion. The average annual CAGR (growth rate) is going to be 8.8%.
Key indicators of the industry’s capitalisation:
- growing penetration of smartphones;
- implementation of innovative developments and IT solutions;
- synchronisation with messengers and social networks;
- active advertising with the involvement of A-list stars.
For example, more brands are integrating VR and AR into “freemium” casinos. The ready-made content is distinguished by the most detailed graphics and provides an authentic user experience.
About 15% of clients make in-game purchases via cryptocurrency. Another 7% store their savings and winnings in NFT assets, which they can trade on specialised exchanges.
The Main Things about the Development of Social Entertainment
What is a Social Casino?
It’s an app or website where you can play popular games using virtual coins. 
The modern market of social entertainment
Aspects that operators need to take into account:
- The key distinction of social casinos is the absence of bets for real funds. Such websites and mobile applications do not fall under the requirements of regulators, which means they are available to players from different jurisdictions.
- Monetisation is carried out through in-game purchases. Operators also earn money by publishing ad units and providing services through subscriptions.
- Popular “freemium” solutions include slots, cards, poker, arcades, quests, and bingo. Video games are the most requested type of content. It provides more than half of all revenues.
- The popularity of social entertainment is growing every year. The audience is attracted by a dynamic betting process, a flexible loyalty system, generous rewards, and a strong competitive effect.
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