The fact that the online gambling industry of the Atlantic City casinos has expanded tremendously since its inception a few years ago hasn’t come as a major shock. However, what has taken people by surprise has been the over-performance of the Golden Nugget casino when compared to its smaller land based presence. While the operator was able to get only an 8 percent market share of the land based casino revenues in the year 2016, it grabbed a whopping 21.5 percent share of online gambling revenues during the same period.
The Golden Nugget has continued to maintain its performance this year, managing to cover an impressive 28.4 percent of the total online revenues until March 2017. Borgata, the previous year’s market leader with a 23.9 percent of the online business, and the biggest land-based operator, was relegated to the second place with 20 percent market share until March 2017.
These are no doubt very interesting statistics and give one cause to consider how important is a land based casino’s brand to the success of its online business.
Strong Atlantic City Casinos Brands Lead to Initial Success
When New Jersey legalised online gambling in late 2013, the gambling sites operated by the biggest casinos raced to the forefront. Sites operated by Borgata and Caesars were able to gain higher market share right at the outset thanks to their higher brand recall. The fact that they had higher marketing budgets, and no doubt large customer databases, would have contributed to their initial successes. The Golden Nugget, never a big name in the land based business, had to make do with a much smaller share of the market. In other words, the relative positions of casinos were pretty much the same in the land based and online monthly revenue reports.
Smaller Operators of Atlantic City Casinos Gradually Advance
The online gambling industry in New Jersey has completed its third year in operation. It is clear to see that the biggest gaming sites are in danger of losing their pre-eminent positions. This, in spite of their land based operations still going strong.
The Golden Nugget has very clearly grabbed the leadership position. But Borgata is struggling to maintain second in its lead over the other operators. There is another interesting point to note in the online revenue figures of March 2017. The Resorts and Tropicana have overtaken Caesars. In fact, Resorts is very close to overtaking Borgata as well.
If an operator’s online performance is compared to its land based revenues, then it’s evident that the biggest land based casinos are under-performing online.
Are Bigger Atlantic City Casinos’ Operators Risk Averse?
There are a few reasons that have led to the poor performance of the online versions of the major land based casinos in New Jersey. One is very clearly that they haven’t made any significant changes to their online offering. For that matter, the marketing strategies are also pretty much the same since the beginning. Incidentally, the only major change that Borgata made to its product was the launch of a Pala branded gaming site.
On the other hand, Golden Nugget has entered into some extremely lucrative partnerships with online site Betfair and SugarHouse Casino. The latter is a popular Philadelphia based operator. The site has also changed to a better platform provider. Furthermore, it has focused on strengthening its product range firstly by adding live dealer games. Virtual sports will also be rolled out soon.
The Way Forward for Atlantic City Casinos
Resorts has preferred to move slowly, waiting for popular online company PokerStars to get its license before launching its operations. Resorts too is considering adding live dealer games and virtual sports to its line up. Powerful land based operators in other states are studying the New Jersey online gambling industry carefully. This is so that they can avoid some of these pitfalls if they ever get the chance to take their businesses online.