The Current Big Thing
Sweepstakes casinos are exploding with new players, and traditional online casinos are getting rattled.
According to fresh data from Optimove, a leading marketing analytics firm, digital sweepstakes platforms are onboarding new users nearly three times faster than their brick-and-mortar counterparts.
Between July and December 2024, sweepstakes casinos saw a 16% month-over-month growth in new players, compared to just 5% for regulated online casinos. That’s not a minor difference, it’s a full-blown acquisition surge.
The study is based on behavior data from over 67,000 players across both sweepstakes and real-money platforms, making it one of the most robust comparisons to be published.
But while the top of the funnel is filling up fast, not all that glitters is gold beneath the surface.
Why So Many Players Are Jumping In
The sweepstakes model has cracked open a market that real-money online casinos can’t touch. Due to a legal structure that treats gameplay as part of a promotional sweepstakes, these platforms operate in over three dozen states, which is far more than the seven U.S. states where online casinos are fully regulated.
That broader reach, combined with the easy signup and free-to-play features, is fueling the growth. New users don’t need to pull out a credit card to get started, which makes casual exploration a no-risk proposition.
Add in social media virality, influencer marketing, and a UX that feels more like mobile gaming than hardcore gambling, and you’ve got the perfect cocktail for fast growth.
Optimove also highlighted that sweepstakes appeal heavily to mobile-first users and younger demographics, and these are factors that traditional casinos can’t really capture at scale.
The Flip Side: Players Aren’t Sticking Like They Do in Casinos
The Optimove report however revealed a huge twist: conversion rates are significantly lower for sweepstakes sites.
Only 12% of sweepstakes users convert to first-time “depositors” (or virtual currency buyers), compared to 51% at real-money gaming platforms. And even among those who do spend, deposit frequency and average spend lag far behind.
- Sweepstakes users average $263 in monthly deposits, less than a third of the $878 seen at online casinos
- They play less too, with 2.6 betting days in their first month vs 4.3 for real-money players
- By month two, the gap narrows (7.4 vs 7.5 days), but early drop-off is a real concern
Most sweepstakes players deposit once and disappear, and that’s a huge red flag for retention. Optimove warns that while the novelty gets players in the door, it fades fast.
To keep users coming back, operators need to work harder by introducing incentives like badges, leaderboards, daily challenges, and fresh promos. It’s a nonstop game of keeping things exciting, or risk losing them after one spin – something Optimove calls “constant content refresh.”
However direct comparisons aren’t exactly fair, and this report admits it.
For one, sweepstakes casinos don’t require real-money deposits to begin play. Many operators reject the term “deposit” altogether, arguing that players are simply purchasing virtual goods (like Gold Coins), not gambling.
That’s a legal nuance with huge implications. And it’s one reason sweepstakes sites get to operate in places where online gambling is otherwise banned.
Additionally, RMG casinos often start players off with deposit-match offers, pushing users into spending quickly, whereas sweepstakes platforms try to emphasize low-risk entry and delayed monetization.
Regulation Is Coming
Montana has already outlawed online sweepstakes casinos, and more bans are on the horizon.
- Louisiana and Ohio are on the brink of similar legislation
- Nevada and Connecticut are advancing bills that, while vague, could have sweeping effects
- Multiple sweepstakes operators have been hit with cease-and-desist letters in states where their legality is disputed
The speed of growth for these sites is a double-edged sword, because the faster these sites grow, the more attention they draw from lawmakers who say they’re dodging regulations and targeting vulnerable players.
What’s Next?
Sweepstakes casinos are winning the player acquisition race, and Optimove’s data proves it. But lower conversion rates and growing legal pressure raise big questions about what happens next.
Will this be a short-lived growth spurt, or a long-term shift in how Americans experience digital gambling?
One thing’s clear: if you’re in the online casino business and not paying attention to sweeps, you’re already behind.
Blaise Luis
