In a move reflecting the ongoing changes within the gambling industry, Sweden’s traditional advertising spend by gambling operators plummeted to a seven-year low in 2022. Total expenditure was reported at SEK3.40bn, marking a 15% fall from the preceding year, according to figures released by the Swedish regulator, Spelinspektionen. This represents the most significant reduction since the data recording commenced in 2016, and a dramatic slide from the 2018 high of SEK7.30bn.
The Rise of Digital Marketing and Regulatory Impact
Delving into the specifics of the 2022 spend, casinos took the largest slice, accounting for 30% of total advertising outlay, primarily for online platforms.
Sports betting, excluding horse racing, trailed closely behind with a 28% share. Lottery-based games claimed 26%, horse racing secured 12%, and bingo, predominantly online, made up the remaining 4%. These figures, however, do not encompass digital media advertising, such as social networks, keyword advertising, and online videos.
The consistent decline in traditional advertising expenditure since 2018 coincides with the relaunch of the Swedish regulated market on 1 January 2019.
The post-regulation landscape saw unlicensed brands exiting the Swedish market, and Spelinspektionen rigorously tackling unlicensed activities. This led to a noticeable reduction in advertising spend as focus shifted to regulated ventures.
The waning of traditional advertising spend can also be attributed to the increasing reliance on digital marketing. With digital platforms offering cost-effective targeted advertising and immediate access to gambling services, traditional advertising avenues are losing their appeal.
Implications for the iGaming Industry
The unfolding events in Sweden carry noteworthy implications for the wider iGaming industry:
- Traditional vs Digital Marketing: The sharp decrease in traditional advertising spend and the shift towards digital marketing underline the need for gambling operators to adapt their marketing strategies to evolving trends.
- Regulation and Compliance: The Swedish case study demonstrates the substantial impact that regulatory changes can have on an industry’s advertising landscape.
- Channelisation Challenges: Despite regulatory efforts, issues around channelisation persist. This raises questions about the effectiveness of regulatory measures in achieving a fully licensed market.
As the Swedish gambling industry navigates the tides of regulatory changes and the shift from traditional to digital advertising, the landscape is being reshaped. With operators adjusting their strategies in response to these changes, the industry is witnessing an evolution in its marketing practices. One thing is clear, however: the iGaming industry is anything but static.