Why High-Payout Online Casinos Matter in Canada's $4B iGaming Market

Benefits for all

Yes, online casinos are essentially entertainment and should be approached as a fun way to spend leisure time, and yes, everyone knows they are businesses that need to turn a profit, but how much they pay out matters and is a real indicator of how they view their customers. Playing at an online casino should be a win/win opportunity. The player gets to have a great time and might walk away better off than they arrived. A great online casino recognises that players need a genuine benefit to keep playing or return, so making payouts achievable is good business strategy. 

You might think that high payout only refers to the amount paid out and why big rollers might be attracted to a particular online casino. However, the payout rate is the average percentage of all money wagered that is returned to players as winnings. While it could be tempting for online casinos to try to increase their share of profits, as you might see in commodity industries like oil and gas, that is not how to drive sustainable business growth in the iGaming sector. 

Booming, competitive market

And there is no doubt that the iGaming sector is booming. Ontario's commercial online casino market has been the poster child since its successful launch and it is setting records. Alberta's market is now operational too. To build successful online casinos, businesses need to follow strict licensing rules and be seen as fair and fun. For some people, casino gambling is still a taboo subject (much less so in Canada than in many of the more conservative US states). By offering decent winning chances and high payout rates, online casinos show they are responsible operators.

This is particularly important in Alberta where the government's stated aim is player protection rather than profit. The regulatory framework requires iGaming providers to put player protection front and centre in their operations. While the money the state and operators rake in as players shift from the grey to the regulated market will be a boon, it should not come at the cost of safety or an enjoyable experience.

How payout rates are calculated

Payout rates are not as simple as for every $1 stake, the player is guaranteed a particular return. The payout rate is a long-term indicator; sometimes a player gets more out than they paid in, and other times it's the other way around. Regardless of how the players fare, ultimately the house always wins, which is why the Canadian market, where citizens have a higher propensity to gamble than in some seemingly similar countries, is so attractive to the online gambling operators.

The casino payout rate is the percentage of real money that the casino returns to players as winnings. RPT is the theoretical percentage a game will return to players over time. House edge is the percentage the casino retains, and this covers their fixed costs like overheads, variable costs and profits. Table games tend to offer higher RTP than online slots, and casinos' payout rates are calculated by considering all gaming sectors.

Review sites can make or break a site

From a player's point of view, it is good to understand what advantageous payout rates are and what might affect their chances of cashing out the jackpot. Online review site Casino.ca guides players through payout-rate options and recommends iGamers visit its selection of highest-paying online casinos. While payout rates (RTP) are only one of the data points they review when rating casinos, it is an important one.

Review and comparison sites are an essential tool in a player's armoury, and millions of people consult them before setting up accounts and making deposits. Online casino sites that retain too much profit and are stingy with RTP will not find themselves being highly ranked. Financial growth in the online casino sector comes from making relatively small amounts from hundreds of thousands of potential customers.

The market is relatively young (or very young in the case of Alberta) and has a long way to go before platforms consolidate. There is lots of healthy competition and (literally) everything to play for. The best operators want to be highly rated, earn excellent expert and consumer review scores, and secure top-ranked positions. Online casinos and their games are, to a large extent, popularity competitions. Players feel attached to sites they believe have their best interests at heart and play games that reflect their personality. 

Ultimately, for the player, what matters is a great game selection at a safe online casino that makes them feel as though they have a chance of a win. The best online casinos also offer fast withdrawal methods via a variety of payment methods. Payout rates and withdrawals can sometimes get confused in a player's mind. However, when they win, they want to receive their funds quickly. Generally speaking, sites that offer the highest payout rates often offer the fastest withdrawals, as both are a commitment to excellent customer care and support. 

Online casinos that thrive in the competitive market are a blend of many things. Players are looking for sites that have great game libraries, impressive payout rates, games with decent RTPs and near-instant withdrawals. They also want to see that sites are properly licensed, have decent customer services and offer great bonuses and incentives. Sites that can deliver across the spectrum are the ones that will blossom.

First mover advantage

At the moment, Alberta's site is only partially launched, for example. That means it could be tempting for the online casinos to play a bit 'hard and fast' as there is less competition for them. They could try to push up their house edge and lower what is returned to the player. The problem with that as a strategy is that it does not build long-term loyalty. When the new casinos come online, people will be tempted to stray and see what else is on offer.

If operators already there use their first-to-market advantage, they can use payout rates to build customer loyalty. That means that the later entrants will have to fight even harder for attention and market share and will probably offer tempting bonuses and promotions. However, if players try new sites and find them lacking when it comes to payouts, they are unlikely to hang around for a long time.

While payout rates are a product feature, they are also a marketing and sales tool. The best sites build successful customer relations and brand loyalty.