Former Adjarabet CMO on potential of Georgian market

As chief business development officer and CMO, Lasha Machavariani played a key role in helping Georgia-facing Adjarabet become the leading operator in the regulated market.

Since leaving the firm last year, Machavariani has gone on to found Setanta Sports Georgia, a broadcaster of live sports events in the Georgian language.

However, the marketing specialist has also kept his eye on the Georgian gaming market and, speaking to EGR Intel ahead of his appearance at the Betting on Football conference next week, he said the market could be the next European jurisdiction to see an influx of foreign operators.

Machavariani believed interested parties were looking on to see how Betsson, which in 2015 bought Georgian operator Europe-Bet, tackled the market and how they can take learnings from the operator’s experience.

EGR Intel: What makes Georgia such an attractive market, in your view?

Lasha Machavariani (LM): Well, if we were taking into consideration purely population of the country, or the GDP as a metric, Georgia won’t be an attractive market. But as we know from public sources, that only in 2014, Europe-Bet’s revenues amounted to $52.4 million, with online operations accounting for $40.8 million. So if we just calculate total GGR by assuming that Europe-Bet was holding 30% on the market at that time, and that the market volume stayed the same, Georgia is a really special market in the region.

EGR Intel: What is typical demographic of a Georgian gambler?

LM: Recent penetration of the internet activated a new segment for the gamblers in the country. In general there was a mix between the transitions from off-line to online, direct online users and the minority segment of the customers who stayed gambling offline.

Because the off-line betting is heavily controlled by the government, age problem doesn’t exist here. And I would say that an off-line gambler is more 35-65 in age, but we need to separate casino user and betting user when analysing off-line customers, they do differ in terms of the purchasing power and behaviour. The online player is spread across all age segments and gender.

EGR Intel: Has the regulator got the framework right in Georgia? If not, where is their room for improvement?

LM: They have created a clean ecosystem of the operators – that does create quality improvements and better service for the customers. Operators have become less in quantity for last 10 years, but with much better quality and better understanding of the industry needs. So the customers are in win situation here.

Responsible gambling is not pushed as it really could be pushed from the operators, I think that the regulators can do better in this direction. This wouldn’t cause any dramatic industry revenue drop, but at the same time will push the cleaner environment for gamblers.

EGR Intel: Betsson was the first major foreign operator to get involved in the market – why haven’t other companies followed suit as of yet?

LM: There definitely will be an interest from several international companies. But I think that first, they need to analyse the Betsson case, with its mistakes and improvements. The proper result analysis of this acquisition is really very important for strategic decision. As a market expert I do have my objective opinion and analysis of Betsson’s performance based on the market data, which I will present during the conference.

EGR Intel: What are the five main factors that operators looking at the market should take into account?

LM: As main factors, I would list the following:

– Internet/mobile betting penetration

– Easy to set up the business

– Fully regulated gambling market

– Regional hub

– Local mentality

Machavariani will be presenting his findings on the Georgian market at next week’s Betting on Football conference at Stamford Bridge, London.

Meanwhile, EGR will be hosting its annual Eastern European Online Gambling Briefing on 24 May in Prague. Click here for more information.