“The development of online gaming in LatAm territories is moving in the right direction, but at a slower pace than expected,” explained R Franco’s CMO, Ruben Loeches, as the company continues to navigate the challenges posed by the current COVID-19 pandemic.
Over the past few years, there has been a greater influx in operators and suppliers trying to gain a bigger influence in the Latin American market, with deals being announced on a weekly basis.
Platform provider R Franco Digital is one of those companies that is aiming to enhance its online position in the LatAm market after being a pivotal figure in the region’s land-based casinos in recent decades – as well as being the first to go live online in Colombia in 2016.
Loeches took time out of his busy schedule to talk to SlotBeats about R Franco Digital’s development in the LatAm market, highlighting the impact of the current health crisis, the appetite for slots in Latin America compared to Spain, its marketing strategy following Spanish regulation in 2012 and more.
SlotBeats: When it comes to your home market of Spain – what’s the appetite for slots there?
Ruben Loeches: Slot machines are very popular in Spain, mainly because they have been widely used by the retail sector since the 1980s. At that time, you could walk into virtually any Spanish bar and see at least one slot machine.
This facilitated the transition to online, a process that was accelerated by the advent of regulation back in 2012, and since then, the country’s appetite for slots has only grown.
The latest data collected in the 2019 Game Report published by the DGOJ indicates that the GGR of online slots has grown 20.21 per cent since the 2018 financial year, which makes Spain one of the most exciting regulated markets when it comes to growth.
If we take a deep dive into these numbers, we can see slots now take a 21 per cent lion’s share of all GGR generated, coming in just behind Live Betting, and outstripping roulette, poker, and bingo. These statistics are a case in point as to just how big the appetite is here, with slots now generating more GGR than pre-match bets – despite being one of the world’s foremost football-loving nations.
“The online sector has evolved significantly since regulation in 2012.”
SB: How would you chart the progress of the igaming market following regulation in 2012?
RL: The online sector has evolved significantly since regulation in 2012. Before that, Spain’s igaming industry consisted mainly of land-based and retail markets. Yet new technologies, together with regulation, have now shaken up the entire sector.
Figures show that Spain’s operators generated a GGR of €229m from online gambling in 2013, rising to €749m in 2019. This 327 per cent growth in the seven years since regulation demonstrates a clear shift towards online channels.
If we compare billing and GGRs for slots for Q4 2015 against 2019 Q4, we’re talking about a five-year growth pattern of close to 548 per cent in amount played, as well as 525 per cent in terms of GGR generated. Suffice to say – we’ve certainly come a long way.
SB: Are online slots more popular among young demographics?
RL: We’ve certainly seen the popularity of online slot games skyrocket in recent years. Young adults are accustomed to fast and easy internet access – and have come to expect instant gratification, so online caters perfectly to this over retail.
Suppliers have adjusted accordingly, with far more of today’s games geared towards a new generation of audience, with immersive themes, pitch-perfect soundtracks and action-packed visual effects.
SB: How do you segment marketing strategies?
RL: The segmentation of marketing strategies can be complex, and age is not the only factor. A lot of the collective betting habits we see today mirrors previous generations, and we base our segmentation on players’ demographic data and betting history in order to get an idea of their preferences.
“We’re increasingly finding that modern player preferences are becoming far more globalised, and we’ve observed plenty of similarities when compared to Europe.”
SB: And over to LatAm – is there a difference in your approach there in regard to RTPs and other features?
RL: We’re increasingly finding that modern player preferences are becoming far more globalised, and we’ve observed plenty of similarities when compared to Europe. As a consequence, we do not generally determine RTPs based on geographical location, but rather on how long the game in question has been on the market for.
SB: What is your opinion on the development of online games in LatAm?
RL: The development of online gaming in LatAm territories is moving in the right direction, but at a slower pace than expected.
Just like most of our industry peers, we were certainly hoping that regulation in markets such as Mexico and Colombia would have been followed soon after with a similar process in neighbouring countries.
That’s not to say that we’re not making progress, I fully expect Brazil and Peru to continue with their preparatory work, although admittedly we are seeing pessimism as to whether they pass the final hurdle. In my view, full regulation can’t come soon enough – I anticipate it to be an excellent windfall for both national economies, and a welcome addition to the state’s budgets.
SB: Has the ongoing pandemic increased interest towards online gaming over land-based?
RL: Without a doubt. In the wake of land-based closures across the board, players have been forced to look for alternatives.
Many land-based bettors may revert to their old habits when casinos reopen, but many will have discovered that online gaming is simpler, safer and more enjoyable than originally thought. At R. Franco, we’ve certainly enjoyed welcoming them aboard with our operator partners.
SB: How do you see the online gaming market developing in LatAm over the coming years?
RL: A lot depends on the development of unregulated markets. It is interesting to compare regulated territories including Mexico and Colombia with unregulated ones such as Peru and Brazil. The absence of regulation puts profits in the hands of foreign companies, usually at the expense of the domestic economy.
Estimates put offshore revenue at close to 75 per cent of all LatAm GGR, and as this money begins to come home, I predict that we will see an exponential increase in the market’s overall development as more funding becomes available.
