Can A PA Online Casino Duplicate Golden Nugget’s Success In New Jersey?

The success of Golden Nugget is one of the most surprising stories in the five-year history of the New Jersey online gambling industry.

With Pennsylvania building towards its online gambling launch, it will be interesting to see if a PA online casino operator can dominate the market the way Golden Nugget is dominating in New Jersey.

Dominance might not be a strong enough word to describe GN

Golden Nugget is a small (by Atlantic City standards) casino that ranks towards the bottom of the pack when it comes to land-based casino revenue. But when it comes to NJ online casinos, it’s head and shoulders above its competitors.

Golden Nugget consistently generates more monthly online casino revenue than the next two operators combined. It’s also the only online casino to generate more than $5 million in revenue in a single month, a feat it has accomplished in each of the last 16 months.

As impressive as that is, it barely scratches the surface of GN’s market supremacy.

Not only has the Golden Nugget online casino posted 16 straight months of at least $5 million in revenue, it surpassed $6 million in March 2017; $7 million in January 2018; and $8 million in March 2018.

Here’s how Golden Nugget stacks up against its online casino competitors over the last year-plus.

*Chart does not include online poker revenue.

Why Golden Nugget does so well

Notice that Golden Nugget is not only generating more than twice as much online casino revenue as its competitors, but its growth trend is the steepest.

As such, Golden Nugget has a 35 percent market share, with online gaming generating roughly 40 percent of its total casino revenue.

Here are some of the reasons that have propelled Golden Nugget to the top of the NJ market:

• An experienced, forward-looking team committed to online gaming;
• It has taken calculated risks, including being first to market with live dealer games and was among the first to offer virtual sports;
• It has brought high-performing skins such as Betfair Casino and SugarHouse under its umbrella;
• A little luck in not being ready to launch on Day 1, thereby avoiding the worst of the early technical issues that plagued NJ online operators.

Don’t expect a Pennsylvania version of Golden Nugget

Unfortunately, it will be difficult for a Pennsylvania online casino to duplicate what Golden Nugget has done in New Jersey.

Here’s why:

• There will be nearly double the number of operators, and most of them will have experience in the online gaming industry already;
• The state’s onerous tax rate and restrictive policies will make it much harder for an operator to go all-in on online gaming;
• Pennsylvania online casinos are not only competing against one another, they’re competing against the state’s lottery. There is now a PA online lottery, and it’s also offering virtual sports products at retail locations;
• Multiple New Jersey operators are offering live dealer games. And if as expected PA online operators are allowed to broadcast live dealer games from a New Jersey studio, the prohibitive start-up costs that made Golden Nugget’s decision so bold quickly vanish;
• Restrictive regulations will diminish the importance of and impact of skins. That will prevent a Golden Nugget-like boost simply from partnering with a gaming company such as Betfair or SugarHouse;
• The early technical issues that plagued New Jersey have been ironed out and are unlikely to be a factor in Pennsylvania.