iGaming pricing is a unique concept in its own right. The cost to a player for gambling entertainment is often negative, not a loss leader but a nuance of the product that a player is often paid for his entertainment.
Return to Player
As an indicator of price, RTP or its inverse house-edge is used commonly in iGaming industry; sub 1% for table games, 2-6% for slots and 8-12% for sportsbetting when compared to Lottery at 20-80%. This unique position affords some advantages a margin 40% greater than traditional casino games means the operator is better equipped in managing the variable cost of business. Additonal margin providing ability to manage cashsback, discounts, freeplays and offers.
Importance of price
Lottery at its heart is also a different product to that of other verticals, an impulse purchase of a tangible event that provides promise of enjoyment in the future is very different to the purchase of a stream of entertainment and immediate enjoyment experienced in other verticals. The nature of the infrequent Lottery draws means the substitution of product is less practical and thus price considerably more inelastic than other verticals.
A change of thinking is required and when Jackpots reach half a billion dollars it is not just demand that surges and an active pricing approach is more akin to movements in the financial markets.