Apuesta Total CEO expecting top-heavy Peru betting market

Gonzalo Perez, CEO of Apuesta Total, anticipates that the newly regulated online gambling market in Peru will see three or four operators emerge as dominant players, while the remaining brands will struggle to secure single-digit market shares.

Effective February 9, 2023, Law No. 31557 has been implemented to regulate online gaming and sports betting across Peru. This legislative shift marks a significant move towards formalizing the gambling landscape in the country.

Operators that were active in Peru prior to the regulation had until March 10 to submit their license applications. The regulatory body, Mincetur, has issued strict warnings to non-compliant entities, stating that they could incur fines reaching up to Sol990,000 (approximately €245,394, £212,401, or $257,838) or face criminal charges.

Under the new law, Mincetur is obligated to process license applications within 30 business days post-submission. Perez indicates that operators must finalize and submit their platform and content certifications by a firm deadline of November 15. Failure to comply could lead to the revocation of their licenses.

During the initial application phase in March, a total of 145 license requests were submitted. New operators entering the Peruvian market will have an extended timeframe for their applications; however, Perez notes that the specifics of this deadline remain unclear.

Among the international entrants in this emerging market is Rush Street Interactive, while Betsson has successfully acquired a license for its Betsafe brand, which was already operating prior to the regulatory changes. Betsson also secured a secondary license through its acquisition of the local entity Inkabet in 2021. Notably, crypto gaming company Stake.com has submitted its application as well.

Perez predicts a fiercely competitive market landscape in Peru, with both international and local brands vying for limited market share, particularly in the single-digit range.

“I don’t foresee a scenario where every operator can thrive,” Perez stated in an interview. “Much like other countries, we will likely see three or four major operators while the rest struggle for relevancy.”

He anticipates an ensuing battle for market share, predicting that intensified competition will actually bolster the popularity of online gambling. Currently, Apuesta Total holds approximately 25-30% of the market share.

Competition Will Strengthen the Market

Tom Ustunel, CEO of Sportingtech, voiced similar sentiments, forecasting that Peru could become the third-largest gambling market in Latin America. The sector has already witnessed a robust double-digit growth rate over the past five years.

“Intensified competition will be advantageous for the market as companies will allocate substantial funds for marketing,” Perez elaborates. “History shows that when brands invest heavily, the market tends to flourish.”

“Consumers gravitate toward established brands that resonate with them, allowing us to leverage the investments made by our competitors,” he added.

Omnichannel Strategy: A Key to Building Trust with Players

Perez is confident that Apuesta’s omnichannel strategy is a cornerstone of its success. In July, Cirsa acquired a 70% stake in Apuesta, significantly bolstering the company’s growth aims in Peru.

In 2023, Apuesta Total achieved a gross gaming revenue (GGR) exceeding €100 million, supported primarily by its extensive network of retail betting locations.

Perez maintains that Apuesta Total’s presence in over 500 retail locations across Peru is instrumental in cultivating trust with local customers. “This retail footprint significantly enhances our credibility,” he explains. “Historically, many consumers in Peru have been hesitant to embrace online services.”

Apuesta Total has also strategically engaged in sponsorships to further amplify its brand visibility, collaborating with key football clubs to invigorate the country’s sports community.

In 2021, Apuesta Total secured five-year sponsorship deals with two of Peru’s premier football clubs—Universitario and Alianza Lima. Such long-term agreements provide insulation against the escalating sponsorship prices observed in Peru and Brazil.

Perez emphasizes the importance of these partnerships: “Supporting club initiatives is critical for us to forge genuine connections with teams and bettors.”

“We are aware of the potential for rising sponsorship costs, yet we have worked diligently to sustain our relationships. Our partners recognize that we offer more than just financial support; we are invested in their success,” he noted.

Challenges Ahead: Remaining at the Top

As Apuesta Total strives to maintain its competitive edge amidst escalating rivalry from well-capitalized international giants, the road to sustained leadership will be fraught with challenges.

“Our objective is to remain the top player in this market, and we are fully aware of the magnitude of this challenge,” Perez concluded.