Online gambling is now seen, somewhat, as a “mainstream behaviour” in New Zealand – but the way that behaviour is actually shaped matters quite a lot.
Sure, headlines can make it look like everyone’s gambling online, but the reality is, as with most things in life, a lot more nuanced than that. For example, a large part of the gambling activity in New Zealand comes from NZ-based products like Lotto and TAB – and it’s actually a much smaller slice that comes from overseas online casinos, pokies, and offshore betting sites.
Today, we’re going to take a NZ-focused look at the latest revenue and usage patterns – with a primary focus on online casino-style activity.
If you define “online gambling” broadly – meaning NZ-based and overseas – it’s actually surprisingly high. Around 31.1% of adults reported taking part in *any* form of online gambling in the last 12 months, and that works out to roughly 1.34 million adults.
What’s interesting about this, is that it’s a clear sign that online gambling isn’t strictly “niche” anymore. It’s no longer limited to hardcore pokies players or high-stakes poker pros; instead, it’s slowly become embedded in the day-to-day life of Kiwis.
This is also, however, where a lot of people can end up misreading the market. Why? Because “any online gambling” includes everything from someone buying Lotto online a few times a year, through to someone grinding online casino games every single night of the week.
When you narrow it down to online casino games and online poker with overseas online providers, the actual number of Kiwis gambling regularly is a lot lower than “online gambling overall” – but it’s still significant in real-world terms.
According to research carried out in NZ, around 1.4% of adults reported playing online casino games or online poker with an overseas provider in the last 12 months. That works out to roughly 60,000 Kiwis.
When it comes to online pokies, around 1.9% of adults reported spending money on them in the last 12 months – and this works out to roughly 81,000 adults. Yes, that’s higher than casino games or poker, but not massively, and it’s actually a pretty interesting metric that shows there’s not a huge amount of difference between the different online gambling verticals.
In New Zealand, there’s a very important key distinction between “online gambling” and “overseas online gambling”. As of now, the legal situation means most online casino-style gambling is done through offshore operators, not domestic NZ-licensed online casinos. This is expected to change soon, however, as the NZ government looks set to introduce domestic licensing frameworks later this year.
So, when you look at overseas online gambling activity in the last 12 months, it comes out to roughly 3.6% of adults – so, around 156,000 people. What’s even more interesting, though, is the frequency at which people gamble.
In New Zealand, around 0.5% of adults reported overseas online gambling every week – or almost every week – which works out to around 20,000 adults. As a result, that’s the group that tends to drive a disproportionate share of deposits, total turnover, repeat engagement, and gambling-related harm.
So, if we’re trying to better-understand where casino revenue actually comes from, those “weekly or almost weekly” users matter far more than casual once-a-year online participants.
New Zealand’s official gambling revenue reporting is pretty useful, but it does have a significant limitation – especially if you’re trying to understand the numbers involved with online casino gambling, specifically.
The most recent annual totals show that for the main NZ gambling categories:
Those numbers are real – the most recent accurate ones available – and they explain quite a lot about the NZ gambling market as a whole. Unsurprisingly, pokies in pubs/clubs remain the biggest single legal product by losses/profit, and lotteries also remain incredibly popular participation-wise. Casinos do remain a major part of the market, but there’s one major caveat:
Most online casino-style spending happens offshore, and this, historically, hasn’t sat very neatly inside these four domestic sections, which is what people tend to rely on when they quickly look at the data.
That’s just one of the many reasons why the New Zealand government has been moving towards developing a domestic licensing framework; the demand is, clearly, already here, and the market has changed a lot – so without their own local licensing system, they are, quite literally, missing out on a huge segment of the market.
If you put the use and revenue picture together, you end up with a surprisingly clear story. As a whole, online gambling participation is broad – more than 30% of Kiwis report gambling online in some form. Online casino and online pokies, however, are much smaller slices of the pie; roughly 1-2% each.
Overseas gambling is bigger than online casino participation alone, at 3.6%. High-frequency offshore online gambling is quite small and concentrated at 0.5%. Now, this may not sound important, but it matters, because it explains why online casino numbers can grow fast – without the number of adults in New Zealand who gamble online increasing.
In other words, you simply don’t need millions of people playing at an online casino for it to become economically significant, and all it really takes is a small group of regular users, with easy mobile access + high game availability + simple payments.
The bottom line?
New Zealand’s casino and gambling market is increasingly shaped by online behaviour, and that’s something the NZ government is fully-aware of – and looking to capitalise on with the newly introduced domestic licensing framework.
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