TransUnion: Betting is slowing as consumer mobility stalls
A new TransUnion report on the U.S. gaming industry shows gaming activity slowing in the second half of 2023. This is because consumers face many economic headwinds and are therefore limiting their gaming spending.
In the latest edition of the consumer credit reporting agency's Consumer Pulse: U.S. Gambling Report, TransUnion researchers said the U.S. economy exceeded expectations and remained resilient despite persistent inflation.
While stocks are rising and unemployment is near historic lows, consumers are not showing as much confidence as the data points suggest.
Consumer defaults are rising, credit card debt topped $1 trillion for the first time and federal student loan payments resumed in October, according to TransUnion. As a result, consumer mobility fell by 1% in Q4 2023.
Prudent consumers should play less
TransUnion reports that gaming spending has slowed significantly as consumer mobility stagnated and declined in the second half of 2023.
More cautious consumers could put heavy pressure on the gaming industry. TransUnion said in a statement. "Gambling participation in the fourth quarter was at its lowest level of the year; 24% of consumers reported participating in some type of gambling activity, compared with 28% in the previous quarter." "
According to TransUnion, consumer gambling activity fell 10% overall in the final six months of 2023.
The findings continued: "While consumers continue to spend overall, they appear to be more discerning about how they use their discretionary budgets as they navigate economic challenges and face an uncertain future."
TransUnion advises casinos and online gaming companies to adapt to changing consumer sentiment. The research outlook believes it is critical for game operators to "target players most likely to be interested in long-term, sustainable gaming."
TransUnion’s ongoing research shows that gambling activity is inextricably linked to increased liquidity. "When consumers find extra money, they are more likely to place a bet," said Declan Raines, head of gaming at TransUnion. "
About 59% of Gen Some 51% of Gen Z respondents said their financial situation was “better than planned.” Millennials are the most excited about their finances: 77% say their finances are "better than planned."
Existing Players Expansion Activities
While the headlines are that gaming activity slowed by 10% in the second half of 2023, there were some bright spots in the fourth quarter, according to TransUnion.
The financial services company said the proportion of players betting from all channels (land-based casinos, iGaming, land-based sportsbooks, online sportsbooks, land-based lotteries and online lotteries) increased to 50%. Eight out of 10 players participate in at least two channels.
Among operators, strategies aimed at horizontal expansion are clearly working, suggesting broader betting activity among existing player bases despite declining overall participation,” the report said.
Millennials are in better-than-expected financial health and continue to increase their gambling activities, while other generations have reduced their gambling.Millennials accounted for 50% of all bettors in Q4.
Yet, Millennials hold about half of the country’s outstanding student debt. TransUnion said people's discretionary spending is likely to decline as federal student loan payments resume.
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Source: www.casino.org
