China’s sports lotteries have great potential

Outside of Macau, the only major legal Chinese gambling is centred on the nation’s giant sports lotteries, where revenues have shown consistent and impressive growth culminating in the most recent statistics from the Ministry of Finance, which showed that in June revenues at the China Sports Lottery reached $3.1 billion – a stunning 83 percent rise over the same period last year.

Whilst the World Cup football festival in Brazil during the month undoubtedly impacted the numbers (they peaked around six times those of the previous World Cup back in 2010) the underlying growth remained strong…and much of the wagering was conducted over the internet.

The Welfare Lottery experienced less spectacular, but still valuable growth at 18 percent to $2.7 billion, whilst the Ministry reported that total lottery sales in China in H1-2014 rose 19.2 percent to $28.74 billion.

The Ministry statistics clearly do not take illegal activity into account, but a number of respected industry analysts have guesstimated that the illegal sector could be worth as much as $160 billion in GGR.

Even half that would be a worthwhile market, and recently the official Chinese news agency Xinhua quoted the Ministry of Public Security as estimating illegal betting on the World Cup alone this year amounted to almost $3 billion, based on the results of its strenuous enforcement activity.

The latest figures estimate that just 8 percent of China’s vast population is currently betting legally via the sports lotteries, and that suggests that the potential for expansion through more energetic and smarter marketing and management must be substantial.

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