According to a series of studies by GeoPoll, Kenya has the largest population of young gamblers in Sub-Saharan Africa (SSA), with sports betting emerging as the most favored type of gambling.
In April of this year, GeoPoll conducted a quantitative nationwide survey using mobile SMS, targeting a sample of 1,300 respondents. This group was evenly split between males and females, all aged between 18 and 45 years. The aim of the survey was to explore the characteristics of Kenyan betting consumers, including their gambling habits, motivations for betting, and decision-making processes.
In this article, we present several findings, with a focus on low-income earners who belong to the lowest socioeconomic class as defined by Living Standards Measures (LSM).
In Sub-Saharan Africa, the gambling industry has rapidly transformed into a multi-billion dollar enterprise. Recent research from Dublin-based Research and Markets predicts, the worldwide gambling market may reach an impressive value of $635 billion.
A report from PWC listed Kenya and Nigeria as two of the top three gambling markets in Africa, following South Africa. Furthermore, a GeoPoll study conducted the same year found that gambling was gaining traction, especially among men in Sub-Saharan Africa. This trend is attributed to their strong interest in sports and technology, along with the rise of local sports betting companies and the ease of accessing gambling through mobile phones.
Gambling: The Billion Dollar Industry in Africa
The gambling sector in Kenya comprises various sub-sectors such as gaming, lotteries, sports betting, and prize competitions. At present, the country has over 30 licensed betting companies and casinos operating within its borders.
A report from PWC covering the years indicates that best betting sites Kenya generates an annual turnover of $20 million, with projections suggesting it could rise to $50 million by now due to increasing demand. According to Business Daily, the formal betting sector in Kenya paid $28.3 million in taxes, making it the third-largest in Africa, following South Africa and Nigeria.
The Betting Control and Licensing Board (BCLB) of Kenya reports that the gross revenue from gambling fiscal year reached nearly Ksh 20 billion (approximately $198 million). This amount represents about fifty percent of the country's annual health budget, as stated by businesstoday.co.ke.
Why Kenya has become a hotbed for Sport Betting
In Kenya, as in several other African nations, gambling is regarded as a valid form of recreation and leisure. The increase in mobile and online gambling has introduced fresh challenges for regulatory authorities, sparking growing concerns over addiction to sports betting.
Gambling has existed in Kenya for a considerable period; however, the recent increase in sports betting can be attributed to the rise of mobile phone usage and greater internet access, as highlighted by our survey conducted.
The remarkable achievement of sports betting companies is exemplified by SportPesa, which launched 10 years ago and quickly generated enough revenue to sponsor major premier leagues in Kenya before expanding globally. Our research reveals that SportPesa is the leading online betting platform in Kenya, with 82% of gamblers using it. This is followed by Betin at 40%, Elitebet at 22%, Betika and Mcheza both at 12%, and Betpawa at 10%.
The growth of this thriving industry is further highlighted by the advertising expenditures of leading betting firms. Recent data from Reelforge indicates that several gaming companies have surpassed the traditional top 10 spenders in advertising.
Understanding the Gambling Low Income Consumer
Individuals in the low-income bracket categorized as LSM DE make up a significant portion of Kenya's population, accounting for 54% according to a 2017 KARF establishment survey. This demographic presents an appealing target market for the betting sector. Our research indicates that tales of impoverished rural residents celebrating substantial wins and becoming overnight millionaires resonate strongly with those living in poverty and on limited incomes. Although our findings show that this group typically places bets ranging from KSH 10 to 50, their large numbers can transform these modest wagers into substantial sums overall.
Their Demographic Profile
Low-income consumers who engage in gambling come from a wide range of demographic backgrounds, including differences in age, gender, and location. However, certain groups stand out more prominently, particularly urban males of specific ages. While both men and women take part in gambling activities, the data indicates that males tend to participate more frequently.
It is important to highlight that around 50% of low-income gamblers are between the ages of 18 and 25. This youth demographic seems particularly engaged, likely due to their strong connection to mobile devices, interest in sports, and higher unemployment levels.
According to data from the Kenya National Bureau of Statistics, there are 7 million unemployed individuals in Kenya, with 1.4 million actively seeking employment. Our survey revealed that a large portion (40%) of low-income gambling participants is unemployed, while nearly a third (29%) are students. This indicates that many low-income gamblers are relying on gambling as a potential source of income.
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