Online Gross Gambling Yield in the UK Drops by 2% in Q3 2022
The UK Gambling Commission has announced that online gross gambling yield (GGY) has dropped by 2% in Q3 2022, compared to the same period in the year before. Gross gambling yield is the amount bookmakers retain after paying out winnings but before deducting operating costs. According to the Commission, licenced UK betting sites observed a decrease in GGY not only in betting on real events such as sports and competitive gaming, but also in casino offerings and online gaming.
According to the Gambling Commission, the online GGY for the period from 1st October 2022 to 31st December 2022 was recorded at £1.20bn. This showed a marginal drop compared to the same period in 2021. Analysing the numbers further, the Commission reported that this comprised of £446m in online real event betting (down by 3%). The decrease was despite betting sites recording increase in usage – according to the statistics, bettors made 21% more bets, and the average active accounts went up by 20%.
The UK Gambling Commission is of the opinion that UK betting sites have seen more activity because of the 2022 FIFA World Cup in Qatar, which increased general participation in betting and attracted a lot of people who do not normally use betting sites. On the other hand, the World Cup may also be the reason for the drop in GGY, as it resulted in the suspension of the top European League football games in November and December. As such, bookmakers lost bets that regular bettors place on these games.
The Commission reported that GGY from virtual betting was down by 30.2% to £12m in total, and betting sites that offer eSports betting saw a GGY drop of 29.4% to £2.4m. In comparison, online casinos did slightly better, recording a GGY drop of 8%. GGY from slots decreased only by 2% to £582m, but betting sites saw an increase of the number of spins by 8%. According to the statistics, all slots activity amounted to 19.7 billion spins in total. The average number of accounts with monthly activity increased to 3.7m (up 13%), however spins per player were down by 5%.
GGY from other online gaming offered by UK betting sites was down by 7.8% to a total of £159.7m, and GGY from online poker decreased by 11.6%. Any other online betting activities fell by 37.5% to a total of £2m. Betting and gaming industry experts point out that there may be another explanation to the drop in GGY. As GGY is basically the money bookmakers have left after they pay out all earnings, promotions and prizes to their bettors, it is possible that GGY is down because customers won more and reclaimed their deposits, while also making returns on their bets.
According to the UK Gambling Commission, while online betting recorded less GGY for the year, GGY from physical betting at retail locations increased by 5% compared to Q3 2021, amounting to £560m in total. This included an increase of 2% in the total amount of bets and spins, resulting in 3.4 billion for the period. Interestingly, GGY from over-the-counter betting and gaming went down by 5%, amounting to £158m in total, and the total amount of bets was 140 million (4% drop). According to the Commission, since the end of the pandemic over-the-counter betting was at its lowest in December 2022, and this was clearly noticeable through the effect of the World Cup, the lack of Premier League matches, and the abandonments of horse racing events.
On the other hand, the Commission pointed out that self-service betting terminals recorded a growth in usage. The number of bets placed increased by 25%, totalling 35.1 million bets for the period. The GGY from terminals went up to £100m, which is a 20% increase. Gaming machines also increased in popularity, with GGY going up by 6% to a total of £302m. According to the Commission, the average spend per session was £12.48, which also marked an increase, as did the number of spins per session (133 on average). The Commission also reported that, out of all betting sessions using gaming machines, only 3% lasted more than 1 hour.
Q3 has been an interesting period for UK gaming and betting. While the World Cup attracted more people to betting sites, it is likely that some of these people only bet during the event and will not return to it until another big event starts. On the other hand, those who used some of the more popular UK betting sites and took advantage of their various promotions and betting offers may have liked the experience and may become more regular bettors. The World Cup is certainly a factor that would skew the figures one way or another, and it is likely that the next report by the Commission for Q4 will be a return to normal.