Latin America is one of the “up and coming” markets in the online gambling industry and its just starting to hit the radar screen of many online gaming professionals. The challenge is that while we know there is a lot of potential in Latin America, many of us don’t know how to go about tapping into this land of opportunity…and great looking women.
With several gaming conferences coming up in Latin America, there is no better time to start thinking about a potential Latin America strategy for your business. To find out where to start and what to expect, I caught up with Uruguayan native Maximiliano De Muro, an expert in the Latin America online gaming market.
BL: Thanks for joining me Maxi, lets start with why the Latin American market is regarded as having so much potential for online gambling?
MDM: Latin America is the new “vedette” in the world for many businesses. The potential around LatAm is similar to how the market regarded the potential for online gambling in the USA in the late 90’s. In 2010, Latin America had 215 million internet users with an expected growth to 310 million in 2015. E-commerce spending in 2010 was nearly USD 27.6 billion, with an expected growth to nearly USD 70.1 billion for 2015.
While the numbers in Latin America may be smaller than other regions or countries (such as Europe or USA), growth is strong and steady. The internet penetration and e-commerce figures are going up and up every month and all the whole continent is into a “solid defense” against Europe & US economic recession.
BL: Ok, so who are the major players in the Latin American market today?
MDM: Pokerstars is doing a great job all over Latin America especially with their Fox Sports campaigns and TV advertising. Sportingbet has done great in Brazil, BWIN is really big in Argentina and Betsson has just entered Peru. My friends from Betboo (now part of GamingVC) are making great strides in the Latin American market as is ComeOn and a few others.
BL: Latin America is a huge territory! What countries in particular should online operators focus on?
MDM: Brazil is getting REALLY HOT, doubling the e-commerce figures by itself as compared to all the other countries in LatAm. Other countries to watch include Panama, Mexico, Argentina, Chile and Colombia.
BL: Should operators plan on different market strategies for each region or can they work on one strategy to encompass multiple regions?
MDM: Localization is KEY. Brazil is completely different than other countries in Latin America- even the differences between Argentina, Mexico, Colombia, Peru, etc., are significant. Every country has its own slang. Marketing strategies can be pretty similar if you’re targeting the right audience with the right slang. Latin Americans are not used to terms such as “bonuses” yet, so any type of regular bonus should be OK for now (it depends on what are the competitors doing too). When it comes to cultural differences, Brazilians and Argentineans are crazy sports fan, more so than other countries. Chileans like to play poker a lot too.
BL: Before we get too excited, what is the online gambling regulatory status in Latin America?
MDM: It’s a grey area, similar to the USA pre-UIGEA. There are some local regulations at a provincial level in Argentina, but it’s a grey area in general.
BL: What do you predict will happen in the future when it comes to regulation in this region?
MDM: Even on a province level (similar to California and the potential intrastate regulation of poker) depending of the country and its government. This is my prediction for Argentina, Chile, Peru, Mexico, and Brazil.
However, none of this will happen for a while. Maybe by 2015 or 2016. The World Cup and Olympics in Brazil (and Latin America itself) will awaken governments to online regulation, but in the meantime, it remains a grey area. Latin America cultural heritage comes from Spain, Italy, Portugal and France so it’s possible that they may follow a jurisdiction regulation model from those parts of the EU when it comes time to regulate.
BL: Getting money in and out of the system can sometimes be a challenge within our industry- what type of payment methods are available in the region?
MDM: Moneybookers, Ukash, Paysafecards, and Entropay are the main payment methods in the region focused on online gambling.
BL: When looking at new markets, M&A is a great way to get in quick. What does the future hold for merger and acquisitions in Latin America?
MDM: Local startups focused on online gambling operations have a big opportunity to be acquired by the big players. The best example is the acquisition of Betboo from GamingVC.
Thanks to Maximiliano De Muro for enlightening us on this very promising market- follow Maxi on Twitter @MaxiDeMuro to keep up with the latest updates regarding Latin America and the online gambling industry!