Over the years betting has become more appealing to entrepreneurs just because of the possibility to make more money. Running a traditional betting or casino business requires a significant upfront investment, which was a barrier for people with a limited budget.
On the other hand, the online betting business requires significantly less money to start, and yet it offers more opportunities than the traditional betting business.
The online gambling sector is on a rise today. There are many factors that lead to this trend, such as the coronavirus and social isolation, which increased the demand for online casinos and betting websites.
Just to have a better perspective about the industry, back in 2017, the sports betting market was worth $270 million in the United States. Experts predict that by 2024 it is expected to grow to around $90 billion, thanks to clever software solutions.
Is sport betting legal?
One of the most commonly asked questions is about the laws and regulations for sports betting. The answer is yes; in most countries sports betting is legal.
However, make sure you check out the laws in your country just to be sure that you are on the right path.
Sports Betting as a Business
Just like any business, you need a plan in order to make it work. Even though online sports betting provides more opportunities and is a profitable business, it doesn’t mean that customers will come to your business running.
Creating a successful online betting business requires time and a lot of effort. If you want to build successful sports betting business, make sure you go follow these steps:
- Highlight your goals and budget
- Choose a reliable sports betting software provider
- Understand the 3rd parties involved
- Obtain a gambling license
- Create a marketing strategy to attract customers
Highlight Your Goals and Budget
Every business starts with a business plan where you’ll highlight all the things you need to do in order to make your idea work in the real world. This is the place where you’ll define the direction for your online betting business and create the right strategy.
For example, many people choose smaller niches like betting on Kentucky Derby horse racing, rather than covering every sport imaginable. This will lower your business expenses and competition.
Like it or not, every business requires an investment and the online betting business is no different.
There are several costs when it comes to starting an online betting business. Make sure you go through all the costs that are required for starting your business in order to avoid the trap of not having enough money to continue.
Choose a Reliable Sports Betting Software Provider
You cannot run a successful online betting business without a good software behind your website. Your software will be responsible for generating odds, matches, and betting options. It is impossible to track everything manually, which is why you need to choose a good software provider company with a lot of experience in this industry.
Your software will determine your profits, so make sure you go only for the best. After all, this is the base of your business and often cheap software will cost you more in the long run.
On top of that, your website needs to be user-friendly just to make the betting process easier. There are many betting software providers on the market and your job is to determine the advantages and disadvantages of each and choose the one that works best for you. This is a crucial step for your business, so make sure you are doing it right. Even minor bugs and glitches can take a toll on the credibility of your platform and draw a red flag to your business.
Understand Third-Party Involvement
Most online betting businesses rely on third-party solution providers like statistics, analytics, marketing, and payments. This is normal, but make sure you read their terms and conditions before you sign an agreement.
Having a third-party service provider is common in the online betting industry just because it is impossible to start everything on your own.
Make sure you have a clear understanding of all third-party providers just because most of them can take a percentage of each transaction leading to fewer profits if not planned the right way.
Obtain a Gambling License
Sports betting is still a delicate industry and every country has its rules and regulations. Some countries have a ban on all betting services, which limits your options. Just because you have a website, doesn’t mean that it can be accessed by every single person on the planet.
You need to follow each country’s rules in order to make your business legal for betting. There are also markets where they are dominated by few sport betting businesses and don’t allow the new company to enter the market, and there are countries where offshore betting is legal.
You need to gather all the information you need about the marketplace you targeted and find a gambling license that complies with their rules and regulations.
Most licenses are issued for 5 years and they cost around $2500-$10000 annually, depending on your business structure.
Plus, remember that most states in the U.S. have horse racing betting legalized, but you still need to read about the specific laws of each state. If you are from Michigan, click here for a quick guide on how to bet on horse racing in your state: https://www.twinspires.com/states/michigan
Develop the Right Marketing Strategy
All previous steps will take you up to a year to finish, so make sure you are ready for this journey. Now since your business is up and running, it is time to create a marketing strategy that will attract customers to your betting website.
This is also a hard process just because the competition is fierce. They are few years into this business and they are investing thousands of dollars into marketing their services, which makes the situation harder for new online betting companies to emerge.
However, if you focus only on one market segment (for example Horse Racing) then your competition is much lower.
When it comes to your marketing strategy, you need to find a way to approach your customers by offering them sign up rewards, referral programs, and creative social media marketing.
Feeling motivated and ready to start a business?
If you think you can handle all the steps mentioned in this guide, go for it! You’ll not regret your decision.