Part 1: Market size and growth
We have shown
that a successful
market penetration
is possible also in a
market dominated by
a state monopoly and
customer habits
Niko Steinkrauß, CEO,
Merkur Sportwetten
quarter and blackjack worth 11.7% of
the market.
By channel, mobile casino is
growing in importance. For 2017
as a whole, mobile GGR was
worth 26.8% of the total but in the
monthly breakdown provided by
the regulator it can be seen that
this percentage has drifted upwards
over the course of the 12 months
from 19.5% percent in January to
32.1% in December.
stake their own claim in Denmark.
In this sense we can definitely say
that Denmark is small but perfectly
formed.
Land-based betting: A stately
decline
The degree of channel shift within
the betting market is clear both
from a percentage perspective
but the general growth within the
betting market overall has had
Continued overall growth
Taking the market growth rate as a
whole – and considering that 2018
is a World Cup year – it can be
estimated that the online gambling
market will get close to breaking
the DKK4bn mark this year.
It’s the kind of growth profile that
from the operator side helps justify
the significant investment needed
in any regulated market and helps
explain why newer entrants such
as LeoVegas and Mr Green (via
acquisition) have been eager to
10
Within the past two
years, Danske Spil has
lost one land-based
competitor in Tipico but
it has seen its remaining
competitor Cashpoint
enhanced
the effect of retarding the decline
in land-based betting in absolute
terms.
Until the extraordinary margin
returns of Q4 2018 arrived to alter
the perspective, the land-based
sector appeared to have stabilised
its annual decline to a low single-
digit percentage. With Q4 of 2017
included, the two-year decline
stood at 3.7%.
However, the fourth-quarter
margin bump – revenues for the last
three months of 2017 rose 29% over
the previous quarter - meant that
the land-based total rose in 2017
overall to DKK798.3m or 3.8% on
the previous year (see Table 4).
The quarterly picture is mixed
but a year-on-year comparison over
the past two years would certainly
appear to suggest a stabilisation in
the past three quarters of 2017 (see
Table 5).
For 2017, the percentage of land-
based betting revenue accounted
for by Danske Spil – which made
DKK669m last year – was 83%,
down from over 90% in 2016.
Within the past two years, Danske
Spil has lost one land-based
competitor in Tipico but it has seen
its remaining competitor Cashpoint
enhanced via the acquisition of
Tipico’s four outlets.
The surprising element is,
perhaps, that Tipico failed although
it would also suggest that the size
of the market meant that the effort
was worthwhile. Despite spending
significant marketing money on
sponsoring the national team, it
sold up to Cashpoint in the middle
of last year.
It leaves Cashpoint as the
remaining upstart in the space with
Denmark: Insights and data on Europe’s pioneer model for igaming regulation