Not a single institution will tell you the exact amount of their income, since it is not customary in business to discuss financial matters aloud, and, moreover, to share data. Therefore, we will consider this issue from a theoretical point of view and give average numbers that reflect the overall picture of online casino profitability.
Games for online and offline casinos are designed in such a way as to make a profit. Considering that all games in a gambling establishment have a statistical advantage (house edge), they are almost guaranteed to be profitable in the long run. However, the built-in profitability of games has its limits, and in order to become profitable, an online casino needs to fulfill three key goals.
Before we delve into how online casinos generate (and multiply) their income, it is necessary to understand what income is meant.
When a player makes a deposit, the casino does not immediately receive income, the gambling establishment simply stores the player’s money. And the income goes to the cashier only when the player makes a losing bet.
That is, the lost bet is the casino’s profit, and the difference between these amounts and payments to players, respectively, is the net profit. Thanks to the amounts received, the casino spends them to cover all operating expenses, and ideally (if the establishment is successful), the owner makes a profit.
Casino always wins: why?
A reasonable question arises, why is the net winning after all payments practically guaranteed by the casino in the long run?
In fact, Random Number Generator (RNG) based games such as online slots and single player versions of table games like roulette, blackjack and poker have a return to player (RTP) rate set by the game developer or sometimes by the online casino itself.
This indicator, expressed as a percentage, ranges from 93% to 98% for most slots. It shows what part of the bets the casino returns to the players on average.
If, for example, a player bets on a slot with an RTP of 95%, they can expect €0.95 for every €1 wagered. In this case, the casino earns 0.05 euros from each such bet. With a large number of players, visits and bets, a small amount of income from each bet can snowball into an impressive amount.
Profit after payments
Popular with gamblers, live dealer games also guarantee long-term profits. They give the institution certain advantages over the player.
For example, take roulette, where the highest payout per single number is 36 to 1. However, the real odds are 37 to 1 due to the presence of 0 (zero) on roulette. American roulette has an extra 00 (double zero), so the odds are even lower – 38 to 1. Thus, the difference between the true odds and the payout ratio is the very advantage that brings the casino profit. In American Roulette, it is 5.26% (equivalent to an RTP of 94.74%).
While each game provides a different edge to the casino, blackjack is statistically the least profitable for a gambling establishment. The fact is that against a player who uses the optimal strategy, the advantage of the casino can be only 0.3% or even lower. But keno in some variations can give the institution an advantage of up to 40%
But there is one problem here. It lies in the fact that in the short term there are statistical fluctuations that differ significantly from the average. Newcomers to the underfunded gambling business can face this dangerous problem, with the result that most reputable jurisdictions do not grant licenses to operators without proof of significant cash reserves.
Note that suddenly hitting the jackpot before the business has reached good profitability can lead to the fact that a young casino can quickly go bankrupt.
To still answer the question: how much does an online casino earn, let’s look at examples with numbers.
As mentioned above, online casinos can make different settings for issuing more or less money to players. For example, 100 people played in a casino during the day, each of which made a deposit in the amount of 1000 rubles. Multiplying 100 by 1000, we get 100,000 rubles, which the players deposited into the casino bank.
In the casino bank, you can put a percentage of the replenishment of the money that goes to the winnings of the players.
For example, for 100,000 rubles deposited by players, put % of the bank at 70%, it turns out that 70,000 rubles will go to the players’ winnings, and 30,000 will go to the casino’s income. At the same time, the owner of an online casino can set any percentage, ranging from 1% to 100%, at his discretion.
Often popular casinos with a lot of visits put a high percentage, about 90%, to give players the opportunity to sometimes get a good win, which motivates people to come and play again. That is, if visitors to an online casino deposited 100,000 rubles at 90% of the cost, then the casino’s profit will be 10,000 rubles, and 90,000 will go to winnings.
For clarity, let’s take a look at how much profit famous casinos get.
Popular casinos offer a high percentage of winnings to motivate players. That is, the profit strategy provides for the achievement of the following goals: attracting a player, keeping him in the game for as long as possible, increasing the frequency of visits of each gambler.
As a rule, all those who win share their experience with friends and acquaintances who join the ranks of online casino visitors. Popular casinos are visited by about 10-20 thousand people every day, which, accordingly, is approximately 300-600 thousand people per month. Note that not everyone immediately replenishes the balance, since some come in just to get acquainted with the casino, others get to the site by accident after clicking on an advertisement link, etc.
As a result, it turns out that out of these 300-600 thousand people per month, only 30% will replenish our balance, that is, it will be 100-200 thousand people.
Considering that players replenish the balance for different amounts, we took 500 rubles as an average, which we multiply by 100-200 thousand people per month and get a figure from 50,000,000 to 100,000,000 rubles.
This amount is not a net profit, since the casino must pay more winnings to its players from it. Therefore, further we will deduct from this amount 90%, which go to the winnings of the players and get from 45 million to 90 million rubles. It turns out that with 50 million rubles we will receive a monthly profit in the amount of 5 million rubles, and with 100,000,000 million rubles there will be 10 million income per month. We calculated that the monthly profit of an online casino can be from 5 to 10 million rubles, or in terms of US currency – from $75,000 to $150,000 dollars.
Speaking about the profit and income of the casino, it must be said about the costs, which also affect the size of the net profit of the establishment.
First of all, running an online casino requires financial influences. For example, if this is a large casino, then, of course, the costs there will be high, since you need to order expensive hosting that can withstand a large number of visitors to the casino site and not turn off during operation. In addition, the expense item includes the payment of money to an online casino consultant, casino programmers, and so on.
Usually, those who have just launched their online casino take control. The work is greatly facilitated by the introduction of CRM systems that perform many processes automatically:
However, casino ranking requires investments in marketing advertising, constant updating of gaming content with new products, work with affiliate programs, the introduction of new payment systems and much more to make the casino recognizable, popular and profitable.
The gambling business has always been and remains one of the most profitable types of business. So, according to unofficial statistics, in 2019 alone, illegal casinos managed to earn more than 50 billion US dollars.
On average, in one month, a gambling establishment earns impressive amounts from 10 to 20 million dollars. And these are only approximate amounts, and real incomes can differ dramatically upwards.
Since online casinos pay for the operation of sites, as well as the development of the design of such sites, and do not spend money on paying any taxes at all, you can imagine how much money goes into the pocket of an online casino owner.
An example from life confirms the assumptions about the high income of online casinos. We will talk about a couple of our compatriots who came up with the idea to organize an illegal online casino. As it turned out later, these guys turned out to be “lucky”, and in just four years of successful work they brought abroad more than 60 billion rubles of net earnings. However, law enforcement agencies managed to accidentally find the criminals, but they failed to detain all the accomplices. And three co-founders were put on the international wanted list. And the thing is that these people decided to conduct illegal activities and ended up in such a situation.
Someone might say that with so much money in their accounts, they can live comfortably and hide from justice for decades. In fact, this is a very bad example of what not to do if you want to run a gambling business legally without problems with the law. To do this, order a turnkey casino and get a turnkey solution with a license from one of the jurisdictions. Such a business will bring you profit in the long run and will allow you to work calmly without “smuts”.
Our company is ready to help you!
