How White Label Companies Shape Modern Gambling
Over the last 20 years, the gambling industry (certainly online gambling), has evolved dramatically, even having moved in multiple directions at once as companies try to find an edge in the marketplace and identify new opportunities.
Of course, gambling enthusiasts will be very familiar with the more popular live casinos and betting operators, largely thanks to mainstream advertising via television campaigns, major sponsorship deals and the use of brand ambassadors. Big budgets in this industry, without a doubt, get you a long way.
However, what many customers may not be aware of is that there are actually hundreds more gambling sites that exist, which are largely undiscovered especially by those customers who do not actively shop around online. Many of these gambling websites are essentially run by what is known in the trade as a ‘white label company‘, which came to the fore around the late 2000s when a gap was identified in the market.
Essentially a step up from traditional software providers in the gambling industry, a white label company creates online casinos and sportsbooks, according to the brief of the brand’s founder, who has their say on what is done. These have become increasingly popular over the last few years, especially with founders who have a lower budget but also have no idea where to start when it comes to launching an online casino and/or sportsbook.
What Is a White Label Company?
The best way to think of a white label company is as a service provider, or middleman, which in the iGaming industry helps to build brands to specification and takes on as little or as much as founders want them to.
This business model allowed entrepreneurs to help penetrate the online gambling industry, though who did not necessarily have the resources to implement an organization with the required regulatory standards or, even the framework.
As a result, this is where a white label company came into the equation, as they would look after all of the licensing issues, the development of the site, integration of live odds plus slots and games from relevant software providers and suppliers, plus much more like casino payment providers.
Essentially, an entrepreneur could hand over a check, say what they wanted to do and expect a turnaround within three to six months of work. Some white label companies would then include other, continuous arrangements, such as maintenance, while others offer marketing, customer support, and CRM (Customer Relationship Management) services as well.
What is for sure is that white label companies have impacted the gambling industry over the last couple of decades, while in some markets, they may be just getting started.
Leveraging Expertise in the Gambling Industry
Quite often, gambling brands which use a white label company are successful because the founder or founders are particularly knowledgeable about overall strategy and online paid and organic marketing such as SEO and content. This is usually a major part of a gambling company’s growth plan.
While they may have a grasp of the technology, the required languages and what they do, usually the case is that they do not know how to program to the level that is required for the back end of a custom website, which is where a white label company would come into it, among other things.
This particular knowledge gap is where white label companies have proven their worth to new gambling brands over the years, many of which have founders that are skilled in marketing strategy and what needs to be done.
And then there is also the fact that the convenience and time saved for other elements, such as payment provider integration, plus slots content, makes sense for this to be handled by white label companies, where their programmers can do this without having to communicate with a third party business that the founder might use.
Most of the successful brands that use a white label company often have a long-term plan to progress to the next step once the site is fully built, following a laser-focused marketing strategy that becomes profitable over time.
Often, there would be plans to then move everything in-house as the next stage, following targeted growth - the white label company essentially being a necessary means to provide the initial foundation.
Also, with mergers and acquisitions in the gambling industry becoming more and more prominent, most ambitious owners look to target this eventuality, especially if they have their own unique idea about how to build and grow a brand successfully to stand out and even challenge in a competitive marketplace.
To that end, this is where it does make sense to use a white label company, at least in the beginning. It is ,essentially, more of a stepping stone.
The Future of White Label Companies in iGaming
Perhaps the only argument for this assertion would be related to the more mature online gambling markets, like the UK, or wider European industry, however, even then more and more creative entrepreneurs are discovering ways to set their brands apart in the market.
In this industry (and even most others), branding is key, but also having a key differentiator to help set your company apart, while gathering a fanbase. Often, especially for strategic entrepreneurs, they will explore everything from keyword opportunities for an SEO blueprint, as well as looking at untapped niches within the industry where they feel that their brand name is relatable. And then, even new markets where these opportunities have more of a chance of being successful.
As far as white label companies dying off goes, the key word phrase here is ‘new markets’. With the US gambling industry setting new records, online gaming over the last three years has seen major new markets develop, which have shown the capacity to leapfrog the likes of the UK.
While the popularity of online gambling continues to grow in these markets (including LATAM as well), more and more entrepreneurs will be identifying opportunities to create smaller, micro-niches for themselves. Not to challenge the likes of FanDuel, etc, but to build a brand to a point whereby a US behemoth of the same level expresses an interest in acquiring them.
There is also the fact that avid gamblers like variety - something that has proven correct in the US over the last couple of years, which means there will be even more opportunities for new brands.
This is where there will be more and more new possibilities for white label companies - even the creation of new white label companies to service these markets, based on the likely demand that there will inevitably be.
While markets such as the UK have basically matured and become virtually impossible to crack without a million dollar plus budget, there are those like the US (or even just one newly legislated US state), where there may be chances for a white label-developed gambling site to make a splash.
As such, the potential for white label companies in the wider online gambling industry will still exist.
A Potentially Genius Investment Opportunity
According to its official website, B2B white label and content provider, EveryMatrix surpassed €4 billion in May 2023, indicating that there is still a considerable market for white label companies.
This was further highlighted by head of casino, Stian Enger Pettersen who revealed:
These milestones showcase our strength and leading presence in the market, the trust our partners have in us and our products, and just how rapidly both our clients are growing, and we are growing as a result.
A huge thank you to our valued clients who continue to put their faith in us and select EveryMatrix as their trusted provider, while our casino team’s dedication, creativity, and innovative thinking continue to play a pivotal role in shaping the iGaming solutions of tomorrow.
Where EveryMatrix evolved over the years, is that they were careful about selling themselves as just a ‘white label’ and were clever in adopting their own technology that they could sell into established casino brands in order to generate more revenue. Having at least a couple of revenue streams is a smart strategy for white label companies, which could be the answer for differentiation in the long term.
Moving forward, this should be the goal for any white label company looking to penetrate a new market, such as a US state with potential, or even LATAM countries, like Brazil, which has demonstrated to have many possibilities over the next few years. White label companies with a growth plan could prove to be a wise investment opportunity for willing and interested investors, however, they should proceed with caution. No doubt this is still, very much a growth area.