Going Digital in Africa – What You Need to Know!
The African iGaming sector is still at a stage of relative infancy compared to more established markets across Europe. Although there is still much for this industry to learn, this also means that opportunities for growth are still abundant but only with the right market approach.
We spoke with George Mouchrik, Group Strategy Officer at Moja Group to get a clearer understanding of what it really takes to achieve digital success in Africa and what common pitfalls to avoid along the way, ensuring sustainable growth in this region for years to come.
Compared to Africa’s long established retail sector, online gaming is still relatively new in this part of the world. What can industry stakeholders do to ensure these two areas of gaming work harmoniously with each other to ensure long term success for the entire sector?
“Although it has been heavily disrupted by the digital revolution, the retail segment in Africa is still deeply rooted in African culture. Many young bettors use bricks-and-mortar betting shops as a place to hang out, watch games and socialise. However, such shops can prove to be costly, difficult to manage and provide in some cases very low return on investment.
“Therefore, many gaming operators across the continent have taken the step of adopting a blend of both retail and online channels to better engage with their customers. As digital indicators grow and African customers become more connected, the reliance on retail stores will gradually lessen. For now retail will continue to be a major distribution channel that supports online operations.”
Historically, there have been some industry reputation issues, causing problems with customer trust across the continent. How does this impact the growth of the market and how can brand reputation issues be better improved going forward?
“The gaming industry in several African markets has been tarnished far too often by reputation issues, especially addiction and fraud accusations. Over the years Governments have been more proactive and have made significant inroads to regulate the industry in order to preserve and protect the rights of all stakeholders, including both gaming operators and players.
“Further actions taken in regard to licensing requirements in several African countries have helped ensure the legitimacy of the games and services provided. A rise in digital adoption has enabled companies to gain improved clarity on iniquitous activities such as fraud and problem gaming. These developments are helping customers build stronger trust in the market which, in return, allow the market to grow further.
“At Moja Group, responsible gaming is fundamental to our business and we are committed to ensuring our players can enjoy games in a responsible manner. Our platform has extensive metrics which limit underage gambling, compulsive gambling and fraud detection. Furthermore, corporate social responsibility is a major factor within our operations, as we allocate a significant amount of profits to fund social causes in countries we operate in. These core values help nurture our brand profile and build long-term relationships that have a meaningful impact.”
Many market entrants in the past have made the fundamental mistake of approaching Africa with a single market strategy, not appreciating the nuances. Moja Group operates in at least 7 different African countries currently, how would you say they differ and how can operators ensure better localisation going forward?
“The African market is very complex and differs substantially between one country and another. What works for one African country might not necessarily work in another and this makes market expansion strategies highly dependent on a localised approach built from a wealth of experience.
“At Moja Group, we conduct meticulous market research focused on identifying and highlighting the nuances between each country. Focus will be on understanding customer behaviour unique to a market, language barriers, technology used, games mix and many others. Moja Group’s suite of games that are hand-picked for each market of operation is an example of this philosophy.
“Localisation is an ongoing process and one that never stands still. Operators need to better understand each country and realise that the success of operations relies on approaching the African market as the sum of its unique parts.”
Many industry commentators believe online casino will be the next big thing in Africa after sports betting and lottery. However, issues with mobile data prices and player education are seen as potential limiting factors. How do you see the future of this sector in Africa and what is needed to maximise growth in this sector?
“Internet penetration in Africa, specifically in sub-saharan countries, has more than doubled during the past few years. This paradigm shows no sign of slowing, but an issue is that Africa charges one of the highest rates per GB of data in the world, which only increases the digital divide.
“Policymakers have recently been approached to incentivize telecom operators to reduce costs by reducing licensing and infrastructure fees. This forward-thinking stand would help secure the future of the sector.
“On another hand, the current generation of players are more open to technology and more eager to immerse themselves with innovative and challenging games such as online casino games, virtuals and other offerings. This blend of youthful players and an increasingly more affordable connectivity will definitely create growing opportunities for untapped gaming segments.”
There are already some well-established African gaming brands that have a strong brand reputation and high customer loyalty but lack the back-office tech necessary to enable them to take full advantage of online opportunities. Is it better for companies like this to develop their own tech or seek a 3rd party solution to help maximise growth?
“The question of whether to develop internally or outsource is a complicated one as it will differ between one operator and another based on the maturity, readiness and financial wellbeing of the company.
Taking such a decision relies on operators performing an in-depth cost-benefit analysis taking into consideration their funding, growth ambitions, anticipated volumes and long-term strategy. The answer is not black or white, each has its advantages and disadvantages. Africa’s complicated and nuanced gaming landscape means that the importance of local knowledge cannot be understated.”
After speaking with George, it’s clear that the African iGaming market is making great progress already and the digital revolution is in full swing. The price of internet data rates is decreasing steadily, closing the gap on the digital divide and the current generation of players are more open to technology and keener to immerse themselves with innovative, challenging games than ever before – opening a raft of opportunities for new gaming verticals such as online casino and virtuals.
However, before the full potential of this market can be realised, improvements on back-office tech and responsible gaming initiatives still need to be made.
Working with regional and technology experts such as Moja Group is a great way to maximise your chances of success and fully leverage the growth opportunities available in this exciting gaming continent.