A new report suggests that online casinos in Indiana could potentially increase – not cannibalize – visitation at retail casinos.
The Spectrum Gaming Group’s report on the potential impact of legalizing Indiana online casinos commissioned by the Indiana Gaming Commission found that iGaming players are generally not the same people playing at traditional casinos.
This means Indiana casinos could benefit by operating online casinos alongside their brick-and-mortar facilities, the report says.
“Digital gaming in all its forms provides a significant opportunity for providers to generate more revenue while expanding their demographic reach.”
Most casino operators in Indiana offer iGaming in other states
The status of Indiana online casino legislation is currently on hold.
Late last year, the Indiana General Assembly decided not to introduce iGaming legislation in 2024. The decision was made in the wake of a former state lawmaker pleading guilty to federal corruption charges related to his interactions with a casino company.
So, it’s unclear when iGaming might become legal in Indiana and how an online casino market might be structured. But it’s likely the operators of Indiana’s casinos would also manage the majority of iGaming operations in the state.
Five of Indiana’s seven casino operators have both traditional casinos and online casino products in states that offer legal iGaming.
- Boyd Gaming
- Caesars Entertainment
- Hard Rock International
- PENN Entertainment
Data shows younger bettors are at online casinos
One of the obstacles to passing iGaming legislation in the Hoosier State has been the fear by some casino operators that online casinos would cut into the revenue at their in-person facilities.
User data presented in Spectrum’s report dispels that. The data show that the demographics of iGaming users and casino customers are “sufficiently different.” Online casino players are generally younger, while in-person casinos attract an older clientele.
A study by data analysis company Statista cited in the report showed that, in 2020, two-thirds of online casino users were 54 or younger, while traditional casino players were mostly 55 or older.
Demographic data from one unnamed iGaming operator (which agreed to provide the information on the condition of anonymity) with “well in excess of 100,000 customers” backed that up.
In 2022, the majority of the company’s clients were under 55.
- 47% were 21-39 years old
- 35% were 40-54 years old
- 18% were 55 years old or older
Data from another unnamed operator, this one with nearly 400,000 registered players, deviated just a bit from what the first operator’s data showed. In 2023:
- 32% were 21-39 years old
- 42% were 40-54 years old
- 26% were 55 years old or older
Still, both operators were in line with Statista’s findings that an overwhelming majority of online casino users are under 55.
Online casino operators report similar data on gender
The two iGaming operators cited in Spectrum’s study offered similar data on gender.
The first operator reported about 10% more male users than female clients.
- 53.6% male
- 43.2% female
- 3.2% “other”
Online casino operator No. 2 reported a larger percentage of male users.
- 65% male
- 35% female
The Spectrum report also included gender information from online gaming company Rush Street Interactive, which operates BetRivers and SugarHouse online casinos and sportsbooks. While Rush Street’s sportsbook products are primarily used by men (86%), most of its iGaming customers are women (54%).
How retail casinos could benefit from iGaming’s younger demographic
The report suggests that Indiana’s brick-and-mortar casinos could benefit from being able to market to the younger iGaming user base.
Digital gaming operators often offer both iGaming (a mix of online slots and table games) and sports betting products within the same app or website. Therefore, many of the sportsbooks currently operating in Indiana (all of which have brick-and-mortar casino licensing partners) would be able activate their iGaming products fairly quickly.
The Spectrum report recommends tethering all iGaming licenses to retail casinos for the best possible outcome and least retail casino cannibalization. While allowing current casinos to offer multiple skins (including those not directly run by the casino companies, as is the case in some states), “the risk to Indiana is that the skins can compete directly against retail casinos,” the report states.
By attaching iGaming licenses to current Indiana retail casinos, operators would be able to potentially expand the user bases of their retail properties through their online offerings, the report says.
“Digital gaming can be an effective means of attracting a broader demographic. Marketing to that demographic can encourage on-site visitation, which could lead to further capital investment, greater employment, and growth in multiple fiscal streams, beyond the taxes generated by digital gaming itself.
“When retail casino operators offer iGaming, they can be expected to leverage the digital offering to enhance and grow their retail revenue by marketing their amenities and their loyalty programs to a broader demographic.”
Synergy from online casinos could enhance revenue in other gaming markets
The Spectrum report states that the age difference between online casino and traditional casino players is a large part of the appeal of iGaming to retail casinos. In the long run, as the older demographic of in-person casinos dies off, there has been concern in the industry about the depletion of casinos’ user bases, the report says.
“The traditional casino industry has long searched for an effective means of attracting a younger demographic. The retail industry’s core players – particularly slot players – continue to age and are not being replaced by younger players. Because iGaming offers a broader demographic reach, it would help address that demographic challenge.”
Spectrum’s report also suggests that the synergy created by iGaming could also lead to older traditional casino players engaging with online casino products.
“iGaming and other forms of digital play will attract younger players, but the benefits of convenience will also increase participation from the gaming industry’s existing demographic base.”