China iGaming Market Forecast For 2024

Contact Now

For the Chinese gambling industry, 2023 is a "difficult" year. Why use quotation marks? In fact, for the Chinese gambling market, after a series of negative publicity from the Chinese authorities, iGaming has entered the vision of most people. iGaming is no longer unfamiliar to the majority. The market remains the same, and Chinese gamblers are still the same. Despite the negative publicity by the authorities, it has even attracted more potential players. But why will iGaming face difficulties in China in 2023? Some gambling platforms argue that it can still thrive and maintain profitability. What will the outlook be for the Chinese iGaming market in 2024? Can new gambling platforms still enter the Chinese iGaming market? Is there still space for new gambling platforms to survive? Today, TC-Gaming will discuss the predictions for the Chinese iGaming market in 2024 with everyone.

Why am I only now discussing the Chinese gambling market for 2024 with gambling industry experts? From a personal perspective, the current environment of the Chinese gambling market is quite complex, especially after the Cambodia incident. The boundaries between gambling and online fraud have become blurred in the eyes of the general public. As a writer for TC-Gaming, I had to organize my thoughts before being able to discuss this. It's not appropriate to casually write articles about the entire Chinese gambling market just because it's a new year. The reality must be considered, and I'll start by discussing the challenges and opportunities in the current Chinese gambling market.

What opportunities are there in the Chinese gambling market in 2024?

To understand the economic environment in China, let's first take a look at the latest report from China's National Statistics:

China's urban fixed-asset investment growth rate for December is 0.09%, compared to the previous value of 0.26%.

China's industrial value-added growth rate for December (for enterprises above a designated size) is 0.52%, compared to the previous value of 0.87%.

China's GDP growth rate for the fourth quarter is 1%, in line with expectations, and compared to the previous value of 1.3%.

The National Bureau of Statistics reports that market sales have recovered quickly, and service consumption has grown rapidly. The total retail sales of consumer goods for the entire year reached 47.1495 trillion yuan, a growth of 7.2% compared to the previous year.

The National Bureau of Statistics notes that the service industry has grown rapidly, with obvious improvements in contact-intensive and gathering-type services. The annual value-added of the service industry increased by 5.8% compared to the previous year.

China's GDP growth rate for the fourth quarter on an annual basis is 5.2%, slightly below the expected 5.3%, but higher than the previous value of 4.9%.

China's annual GDP growth rate for the year 2023 is 5.2%, surpassing the previous value of 3%.

The total GDP for the year 2023 is CNY126.0582 trillion, compared to the previous value of cny120.4724 trillion.

According to the National Bureau of Statistics, the preliminary calculation for the annual GDP in 2023 is CNY1260582 billion, a growth of 5.2% compared to the previous year. By industry, the value-added of the primary industry is CNY897.55 billion, an increase of 4.1% compared to the previous year; the value-added of the secondary industry is CNY4825.89 billion, an increase of 4.7%; and the value-added of the tertiary industry is CNY6882.38 billion, an increase of 5.8%. Looking at the quarters, the GDP growth rates are 4.5% in the first quarter, 6.3% in the second quarter, 4.9% in the third quarter, and 5.2% in the fourth quarter. On a quarter-to-quarter basis, GDP increased by 1.0% in the fourth quarter. (Source: CCTV News)

Based on the data we have observed, it is evident that China's recent economic situation is on a sustained upward trend. This is further confirmed by the Chinese government's decision to lower interest rates twice last year, a strategy that undoubtedly provided greater stimulus to domestic economic development in China. Considering these factors, my personal opinion is that the most conservative prediction for the coming year is that interest rates will continue to remain at relatively low levels. This also implies that the upcoming year could be a crucial period for the continued ascent of the Chinese economy. All these developments fill operators of gambling platforms with anticipation and confidence regarding China's economic outlook in 2024.

Loan interest rates in China for the year 2023.

Let's take a look at the data regarding gambling in China:

According to the announcement from Aobo Holdings, the net gambling revenue (NGR) for the third quarter increased by 492.9%, reaching 5.41 billion Hong Kong dollars (556.4 million pounds/638 million euros/693.5 million dollars).

The latest data from the Chinese Ministry of Finance reveals that from January to November 2023, the total nationwide lottery sales amounted to CNY5264.12 billion yuan, showing a year-on-year increase of 45.1%. Among these, welfare lottery sales by organizations reached CNY1769.65 billion, a year-on-year growth of 29.8%, while sports lottery sales by organizations reached CNY3494.47 billion, with a year-on-year increase of 54.3%.

The Macau gambling industry once again demonstrated strong performance, with the monthly total revenue for December reaching 18.6 billion Macau dollars (1.8 billion pounds/2.1 billion euros/2.3 billion dollars), showing a year-on-year growth of 433%.

It is noted that the number of lottery players in China has been in a stable state and even increasing year by year. Whether it's lottery players in the low-end market or high-end gambling enthusiasts, there is consistently strong demand. This represents a vast potential market, filled with limitless business opportunities. From the economic and gambling industry reports in China, it is evident that the Chinese gambling industry holds great promise and is full of unlimited possibilities.

China gaming market opportunities/challenges

1. Rise in Labor Costs

Before the outbreak of the pandemic, although recruiting personnel was relatively easy, finding high-quality, resourceful, and capable employees was not so simple. Additionally, due to fierce competition for talent among iGaming operators, wage levels have consistently been on the rise. However, compared to the period before the pandemic, there has been a significant pullback in labor costs during the pandemic. Although there has been some adjustment, it is unlikely to return to the levels of 2018-2019. Therefore, overall, labor costs are indeed increasing, putting pressure on the operational management of gambling platforms.

2. Narrowing Channels and Rising Costs of Promotion

In the past, extensive promotion and advertising could be achieved with just a Douyin (TikTok) account, a Xiaohongshu (Little Red Book) account, and a WeChat account. An employee could manage and maintain hundreds of accounts on gambling platforms, generating significant traffic and exposure with sufficient effort, rule comprehension, and software assistance.

However, the situation has undergone significant changes. With the Chinese authorities' negative publicity on social media, implementation of real-name registration, IP and regional restrictions, limitations on phone card usage, and various other measures, many previously effective channels for promotion and advertising have become less effective. Once an account is blocked, it can result in a sudden loss of a substantial amount of traffic and followers, significantly impacting online gambling platforms.

Simultaneously, rules for other promotion channels have become increasingly strict and complex. Promoters for gambling platforms need to invest more time and effort to adapt to these new rules, and the stability of these rules is uncertain. Therefore, the path of promotion is becoming more challenging.

What about SEO (referring to Baidu SEO)? Actually, SEO is considered one of the relatively stable channels in gambling promotion. Many gambling platforms invest in SEO for websites such as movie sites, adult content sites, mobile apps, comic sites, and novel sites. These are sites that can drive traffic. If done well, it can be a stable channel for long-term traffic. However, the initial costs might be high, including domain costs, server costs, labor costs, external link costs, and time costs (building a site is not something that can be done in 1-3 months). Some may argue about buying ready-made sites, which is possible, but the key is how long the site you purchase can remain stable. If the website dies within 1-2 months, it's a loss, so buying a site also carries risks. Short-term keyword ranking improvements through technical means for many websites are often short-lived. Therefore, if you have a stable source of SEO website traffic, it can greatly enhance the survival prospects of your gambling platform in the Chinese gambling market.

If your gambling platform's promotion channel relies on social media, most of this promotion is based on word-of-mouth and some group promotions. This is self-evident, mainly depending on the capability of the execution team. The effect has always been there, and account costs have not risen much. However, the online environment and labor costs may experience some increases.

Affiliate advertising has always been one of the effective promotion methods for online gambling, including X-sites which have been using this approach. Fortunately, after the pandemic, the prices of major advertising alliances have decreased somewhat. As for the effectiveness of promotion, it depends on the technical capabilities of the advertising alliance, such as having a dark layer or not, and whether the JavaScript will be blocked by the browser or ad plugin, which can significantly affect advertising effectiveness. Generally, landing pages are used for such promotions. The key is still the technical and execution capabilities after placing the ads.

The promotion method of developing downstream through the agent model will not be discussed in detail. Each case will be different, and effective agents and follow-up maintenance are crucial.

3. Narrowing Payment Channels

Since the outbreak of the pandemic, the Chinese authorities have significantly tightened controls on card transactions, set limits, and implemented stricter risk management measures. It can be said to be quite stringent. Many personal bank cards now have a daily spending limit of CNY5,000 yuan, and exceeding CNY50,000 in transactions might trigger risk control measures. Opening individual bank accounts has also become more difficult. As a result, commissions for third-party payment channels have increased. While it's possible to use cryptocurrencies such as USDT, not every Chinese individual has access to cryptocurrencies. Additionally, the Chinese authorities do not recognize cryptocurrencies, making it difficult for them to circulate domestically. Therefore, using cryptocurrencies can only address a small portion of gambling players.

Regarding Alipay, the situation changed recently. On December 30, 2023, the "People's Bank of China updated the major changes in the permit information of non-bank payment institutions" showed that "Alipay (China) Network Technology Co., Ltd. has been approved to change to having no actual controller." This is quite clear; the confiscation has become public. If Alipay has reached this point, not to mention WeChat, which is even more adept at compliance – WeChat is the most favored.

Smaller payment platforms also strictly control their inflows and outflows to prevent risk. Therefore, overall, in the Chinese gambling market, payment channels, apart from fixed costs, should be one of the most significant variable costs.

How to Solve Payment Channel Issues?

Although China's regulatory environment for payments is extremely strict, which may lead some to anticipate payment issues, the reality is that despite stringent regulations, existing gambling platforms continue to operate normally. This indicates that while payment is a challenge, it is not an insurmountable one. In fact, many third-party payment platforms are still operating smoothly, providing viable solutions to address payment concerns. The existence of payment issues does not imply they are unsolvable.

How to Manage and Expand Gambling Marketing Channels?

For gambling marketing and promotion, each gambling platform may have differences, showcasing various strategies. Here, TC-Gaming's editor provides a few insights for reference by gambling industry experts.

Affiliate Marketing

It's essential to control the sources of click-through rates and the duration of stay. Simultaneously, being able to see the display effectiveness of affiliate advertisers is crucial. Generally, these advertisers provide a display rate of around CNY200-400 per thousand impressions for major websites. However, they will deduct a portion for the site owner, so receiving about CNY200 in hand is estimated to be sufficient. Don't just advertise with one or two, instead, adopt a decentralized approach to ensure accurate analysis of the results.

Various Types of Self-Owned Websites

As mentioned earlier, websites such as videos, encyclopedias, novels, etc., can be self-built or purchased, especially those with potential or existing authority. These sites often bring long-term new registered gambling players to the gambling website through natural traffic. The maintenance costs for these sites are relatively low once they are established. In a previous test, for example, a movie site with tens of thousands of daily visitors would have people registering every day, ranging from a few to a dozen.

Self-Media Placement

Currently, most self-media platforms that accept gambling placements are mainly female anchors on X-site live broadcasts. The success of this promotion method depends crucially on the attractiveness of the anchor and the influence of the live broadcasting platform. Finding a suitable anchor is not an easy task, despite the numerous video platforms on X-site. Specific conditions and the right anchor are necessary to enhance the registration and conversion rates for promoting gambling platforms.

Mini Game App Bundled Promotion / Mobile App Promotion

Some gambling companies develop mini-games to attract users to play. Within these mini-games, they incorporate gambling advertisements. Compared to other promotion methods, the player quality attracted by gaming is relatively high. In essence, this can be considered an extension of mobile applications.

Penetrating Data / SMS / Telephone Marketing

With the implementation of real-name registration for mobile numbers in China, the authenticity of phone numbers has greatly improved. In China, almost every website or application registration now requires linking to WeChat or a phone number. This increased linkage between registered phone numbers and websites significantly enhances authenticity.

Additionally, some assembly factories may not invest too much effort in application network security, such as monitoring device apps or dashcam apps. This provides an opportunity for IT professionals skilled in technology. Once they extract phone number data, they can choose between telephone marketing or SMS marketing. This choice depends on their marketing strategy and target customer base. Telephone marketing and SMS marketing each have their own advantages and disadvantages, and the most appropriate marketing method should be chosen based on the specific circumstances.

Website Program Backdoors

Currently, some website program developers leave backdoors in their programs. When a website gains traffic, occasionally, users of this program may be redirected to a certain X-site or a specific gambling platform. To put it plainly, not all webmasters are technically proficient, and generally, these issues are hard to detect. Especially in cases where the entire program is purchased from a source code site, encountering such situations is not uncommon.

DNS Hijacking

Regarding DNS hijacking, this might not be unfamiliar. If you have the resources and the price is suitable, it can be a very stable channel. After all, DNS hijacking targets precise customers, and when combined with landing pages and customer guidance, it becomes a stable platform for attracting new player registrations.

Of course, there are other gambling promotion channels. After all, the competition in this industry primarily revolves around channels, including networking, advertising channels, and various other channels such as office spaces. The TC-Gaming editor cannot list them all. In summary:

When promoting the gambling business, it is necessary to utilize various channels. Whether expanding influence through personal connections, enhancing visibility through vigorous promotion, or using resources like office spaces to attract potential users, each approach has its unique advantages. In general, the key to competition lies in the effective utilization of various channels and resources, which is also a critical factor in achieving success in the gambling business.

Summary

In 2024, China's online gambling market will face challenges but is also filled with opportunities. For new entrants into the Chinese gambling market, in order to succeed or enhance competitiveness, platforms need to address some key issues. Firstly, the payment channel issue needs to be handled properly. Despite the strict government regulations on payment channels, many third-party payment platforms are still operating, providing possibilities for addressing payment issues. Secondly, the advertising channel issue also needs to be resolved. Due to strict government control over social media, many traditional advertising channels are no longer effective. Therefore, platforms need to explore new advertising channels, such as affiliate marketing, self-owned websites, and self-media placement. The overall idea is to have controllable traffic sources or develop new marketing strategies. If your gambling platform has a reliable traffic source, or you have developed new marketing strategies, then your platform is halfway to success. However, in the operational process,For platforms deeply rooted in the Chinese gambling market, TC-Gaming is on it here, as these platforms already have a solid base of players.

TC-Gaming has 17 years of experience in the white label iGaming and is a senior and well-established company in the field. We provide one-on-one professional guidance to help you easily enter the Chinese gambling market. Through comprehensive technical support and services, and dedicated personnel to address technical issues, you can establish a gambling platform website and start operations within 10 minutes. TC-Gaming's white label iGaming system supports various marketing modules, regularly updates the latest popular marketing methods in the gambling market, and provides various reports, making it easier for you to accurately grasp player segmentation. We assist you in enhancing the competitiveness of your gambling platform in the Chinese gambling market. Additionally, TC-Gaming supports multiple language modes, translated by local language experts, making it easy for you to connect with various international gambling markets. TC-Gaming is your best partner in the Chinese gambling market.

Subscribe to TC-Gaming Channel to get first-hand information

Due to the frequent incidents of white label fraud, please contact us through the following official social media accounts