Market Cannibalization Within and Between Gambling Industries: A Systematic Review

In economics, cannibalization refers to a process in which a new product or service partly or completely substitutes for those in existing markets. This systematic review analyses the existing evidence on cannibalization within gambling markets to determine whether such substitution takes place between different types of gambling. The analysis shows that new gambling products substitute to a certain extent for existing gambling products. The sector in which the evidence is most convincing is the casino industry, which cannibalizes lotteries and pari-mutuel racing. There is also evidence that casinos substitute for other casinos and for non-casino electronic gaming machines. Lotteries substitute for casinos, other lotteries, sports betting, and pari-mutuel or racing industries. In other cases, the evidence is less conclusive and sometimes non-existent, or industry relationships are more complicated. This review also found that even in cases where substitution does occur, it is incomplete, and thus the introduction of new products tends to expand the overall gambling market. We discuss these market dynamics and identify gaps in the available research.