The growth potential of India’s iGaming industry and how it can drive India’s $5 trillion vision

India is frequently touted as a country of gamers, but one look at the numbers shows just how much of an understatement that is. The country is estimated to be home to more than 500 million gamers at present and, according to Lumikai’s State of India Gaming report FY22, has a market worth $2.6 billion for gaming-related offerings, making it one of the biggest gaming markets in the world. This opportunity is projected to grow almost four-fold to cross $8.6 billion within the next half a decade.
And this is just the tip of the iceberg when it comes to India’s gaming industry. Despite its size, the country is still at a nascent stage as a gaming market, both in terms of maturity and adoption.  
Online gamers currently account for less than half of India’s total population – a dynamic that is set to change as more young, digital-first users across regions access online games on their personal devices. With more users playing games online, monetisation within the space will also improve; for comparison, consider the fact that more mature markets, such as Germany, generated revenues to the tune of $6 billion last year with less than 10% of India’s current gaming user base.
These trends and data points highlight how the future of the Indian gaming industry remains bright with a massive headroom for growth – and the iGaming space will continue to play an important role in driving the success and growth of the entire ecosystem.
How iGaming has transformed India’s gaming habits and powered cross-industry growth 
Since its introduction over a decade ago, iGaming has been eagerly embraced by users looking to test their mettle at games of chance and skill. The first wave of iGaming companies offered online versions of games that Indians were already familiar with – rummy, poker, etc. – before introducing formats such as fantasy sports that allowed for more proactive engagement with their interests. As a result, users across India are now more comfortable with playing games online.
The next wave of iGaming brands has built on this success by propelling the industry into a brighter limelight with innovative marketing strategies. Armed with a digital-first outlook, these brands have capitalised on the evolving dynamics of the marketing landscape by combining traditional marketing approaches with new-age strategies to reach out to a much wider audience and supercharge the industry’s growth.
This growth has spurred concomitant opportunities for various related sectors. Influencers feature regularly in the marketing campaigns by new-age iGaming brands, as do tech-led approaches such as programmatic media buying and affiliate marketing. Other channels, such as digital marketing and TV ads, have also benefited from the rise of new-age iGaming companies, which account for some of the biggest marketing spends at present. This synergistic relationship has fuelled growth across the board, leading to significant revenues and job creation in not just the iGaming industry but also allied sectors.
From India to Bharat: Refocusing on the urban-rural divide for a stronger growth foundation 
New-age iGaming brands have also built themselves up for long-term growth and success with their deeper understanding of India’s urban-rural divide. While many players initially focused on pan-India marketing, recent years have seen a shift toward region-specific marketing approaches that tap into the diverse cultures and traditions of the target region. By incorporating regional languages, quirks, and cultural references, these vernacular campaigns foster much greater resonance with the target audience, which appreciates and relates better with these marketing initiatives.
This focus on deeper customisation and better hyperlocalisation will serve as a strong foundation for future growth for the iGaming space. While urban markets are useful for initial visibility and traction, rural markets are home to nearly two-thirds (64%) of India’s population. This rural population is also becoming increasingly digitally active; at 399 million, rural internet users have already outnumbered their urban counterparts. The rate of digital penetration in rural areas also means that these markets will account for the lion’s share of new internet users to join the Digital India bandwagon over the next decade. By building their long-term growth and business strategies around the specific needs of these markets, new-age iGaming companies are putting themselves in pole position to ensure sustained success.
Taking the long view: How the iGaming industry will shape in the future 
India is currently estimated to be home to hundreds of gaming companies. Many of these companies operate in the booming iGaming space, which has seen a significant increase in the number of active players and investments. This growth is expected to continue, thanks to the industry’s potential to be a major contributor to economic growth and employment generation.
So, over the next decade, expect more and more investors looking to get in on the opportunity that the iGaming industry represents. This boom will continue for the foreseeable future, as the market opportunity is large enough for multiple players to coexist and grow.
All in all, the Indian iGaming industry is set for a remarkable, exciting growth journey in 2023-24 and beyond. It has the potential to be one of the key drivers for India’s long-term goal to become a $5 trillion economy by 2025 and potentially a $10 trillion economy by 2030. A favourable regulatory environment, market-specific strategies, and investor support will pave the way toward this desired future for the iGaming industry – just as it has been blazing a path for the larger gaming ecosystem.

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Disclaimer Views expressed above are the author’s own.

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