The UK gambling industry as a whole is in rude health. It is one of the largest regulated industries in the world and continues to grow. The latest figures from the UK Gambling Commission report that the industry employs more than 100,000 people. They also show that the UK’s gross gambling yield (total amount made by companies before tax) in 2018 was a gargantuan £14.46 billion.
There is one sector of the industry, however, for which things aren’t quite so rosy. There have been articles all over the internet and in the newspapers discussing the decline of high-street betting shops. We’re going to take a closer look at that so-called decline and see if it really is as bad as some would make out. We’ll then take a crack at answering the question of whether high street bookmakers have a future.
The rise & rise of online gambling?
One of the main reasons why people are so gloomy on the future of betting shops is because of the increasing popularity of online gambling. The popular line is that online gambling is taking custom away from high street shops at a rapid rate. It won’t be long, as per that conventional wisdom, before remote gambling has completely replaced the land-based version.
It’s true enough that online gambling is bigger than it has ever been. As of December 2018, remote gambling had a 37.3% share of the total UK gambling industry. That’s the highest percentage that the Gambling Commission have recorded. At least since they started publishing the statistic in March 2016. Back then, remote gambling’s market share stood at 31.44%.
Those figures support the idea that online gambling is on the rise. They’re somewhat surprising in two main ways, however. It’s perhaps a shock to find that online gambling still accounts for well under half of the overall industry. What’s more, that share’s increased less than six percent over two and a half years. That seems like comparatively steady rather than explosive growth.
Disappearing high street bookmakers?
Stats on the number of high-street bookies in operation over the past few years are also intriguing. In December 2018, the Gambling Commission reported that there were 8,406 of them. The number has remained fairly constant for the past decade. The peak came in March 2014, but even then, there were only a little over 9,000.
High-street betting shops have clearly not been closing at the rate which some stories would have you believe. There is a possibility, though, that things may be about to change. The much-discussed new regulations limiting stakes for Fixed Odds Betting Terminals (FOBT) are about to come into force. They’re expected to have a profound effect on the profitability and viability of high-street betting shops.
GVC (the owner of Ladbrokes Coral) recently warned that they may have to close over 1,000 shops as a result of the regulations. If that comes to pass it would represent close to an eighth of the total betting shops in the UK. That’s certainly something for the land-based betting industry to be concerned about – although many operators have moved online and are showing healthy profits in that vertical.
Is there a future for high street bookmakers?
There’s no question that the upcoming FOBT regulations may have a big impact on high street betting shops. Gloomy predictions from GVC and others may even come true. The likelihood is, however, that betting shops will adapt and evolve to their new circumstances. As we’ve shown, after all, the land-based gambling industry stood up far better to the challenge of online gambling than many thought it could.
High-street bookies will certainly have to find new ways to be profitable. At a Future of UK High Street Bookmakers event recently, Paul Witten suggested that they will do just that. Witten is product director with SIS, a leading provider of 24/7 betting services. He offers a far more positive perspective on the future of betting shops:
‘Now operators have the certainty of what’s coming, I am not saying the purse strings are completely open, but operators can now make their next steps… This is an opportunity to tackle these big challenges and help to provide a better experience for customers.’
The future for high-street bookmakers and their customers might not be so bleak, after all.