Iowa has dipped its proverbial toes into the waters of online casinos as of late. Despite such efforts meeting with little success, it appears the Hawkeye state still has online casinos on the mind.
The benefits of online casinos are obvious: increased revenue, more players, and regulations to protect players.
Often overlooked, however, is the impact younger players will have on the state’s numbers if and when online casinos in Iowa become legal. Offering online gambling is about as close as you can get to a surefire way to draw in young players—specifically young millennials and Gen-Z.
That’s important because Iowa has recently struggled with challenges and threats to its gambling revenue. Young players could represent the solution.
Keeping up with the neighbors
Iowa casino revenue dropped in 2023. The dip can be attributed partially to Nebraska, the state’s southern neighbor. Nebraska legalized land-based casinos in 2020, and three are currently open. Two more are on the way. With new casinos close to the Nebraska-Iowa border, Iowa is losing some of its gambling revenue to Nebraska.
Legalizing online casinos would add a new revenue stream for the Hawkeye State while staving off some of the losses presented by Nebraska’s burgeoning casino industry. Plus, garnering a hefty younger audience could stand to raise Iowa revenue significantly more than the losses to Nebraska.
Why would online casinos attract a younger audience?
Land-based casinos have long floundered in the hunt to entice younger gamblers onto their premises. In a January interview with Forbes, SoBet CEO, and Founder Cooper Lycan said:
“The digital and mobile gambling space currently has a leg up on their analog counterparts because the online space tends to be more inclusive than casinos. The casino of tomorrow will have to adjust to shifting consumer behaviors of an increasingly more diverse, less male-dominated audience.”
Online casinos have options. Land-based casinos do too, of course, but they can’t compete with thousands upon thousands of games and variants on offer at online casino sites. The sheer variety is a great reason for young players unfamiliar with casino games to give them a try.
This approach could potentially lead to those online casino players becoming retail customers, too. Play a live dealer game online, enjoy it, and then you’re better equipped to give it a go at a real casino.
That’s all fine and dandy, but the real kicker is the younger generations’ collective tech literacy. 21-year-olds grew up in the digital age, with constant access to mobile devices, the internet, and more. They live connected lifestyles, and technology offers them the channels to do so.
Cash is becoming a thing of the past. Payments are made online. After all, if you can get a boarding pass, make a restaurant reservation, or chat with friends online, why not make casino games available there too?
Young gamblers are ready-made for online casino gambling. It’s simply on legislators and regulators to rise to the occasion.
Managing the risk
Legal online casinos aren’t all positive. Gambling in any form comes with its fair share of risk.
The onus is on the governing bodies—legislators, regulators, and operators—to ensure players are protected, especially those who are new to gambling. The risks are real, and it’s the industry’s responsibility to mitigate those risks and offer programs to help problem gamblers of any age.
Further, the issue of unregulated online casinos is prevalent. Gamblers flock to these sites, often under the impression that they’re legal. In reality, they’re unlicensed casinos with little to no protection in place for players. Iowans who play at these sites risk losing money or their data by playing at such sites.
The unique thing about offshore betting risk is that it’s best mitigated by legalizing online casinos. A regulated online casino structure would earn more revenue for the state, bring young players into the fold, and allow Iowa to strictly regulate the operations of online casinos.
So far, the state has yet to understand the benefits in any meaningful way. Iowa stakeholders have largely been getting in their own way.
Is Iowa its own worst enemy?
Last month, a measure to legalize Iowa online casinos stalled in committee, ultimately failing. The bill’s sponsor, Representative Bobby Kaufman, expected such a failure, and experts viewed the bill as a way to raise awareness and prepare the state for stronger pushes in the future.
For online casinos to be authorized, Iowa’s retail properties have to back the measure. Currently, operators are concerned that online casinos would cannibalize retail revenue.
The fact is online casinos stand to benefit retail casinos by generating additional revenue for their partnered properties. Drumming up buzz about gambling can’t hurt, either; it could drive new players to visit a property after trying games online first.
As reported by PlayUSA, one recent study showed that states with legal online casinos saw consistent or increased revenue. If this is the casinos’ concern, they don’t have much of a leg to stand on. Right now, these retail operators are only hurting themselves by fighting a new revenue stream and preventing young players from building any interest in gambling responsibly as entertainment.