Sweepstakes Casinos vs. Traditional Casinos

Traditional online casinos and sweepstakes casinos function pretty much the same way. They both have similar sets of casino games and offer players a chance to earn rewards from playing these games. However, the comparison ends there because sweepstakes gaming software is governed by an entirely different legal framework. This is why sweepstakes casino sites are allowed to operate in most US states including jurisdictions where land-based casinos and online gambling are prohibited. This article explores the main differences between sweepstakes casinos and traditional casinos to help you choose between them. 

• A sweepstakes casino is a type of gaming platform where players get to play luck-based games for free instead of wagering with real cash. 
• A sweepstakes casino is not subject to the stringent regulatory requirements that govern regular casinos. As a result, they’re legal in most places where traditional gambling is prohibited. 
• The popularity of sweepstakes gaming is due to their favorable regulatory requirements, potential to generate revenue for operators, and promotional opportunities they offer. 

Choosing Between Sweepstakes Casinos and Real-Money Casinos

Before we take a deep dive into the core differences between sweepstakes casinos and real-money casinos, let’s start by defining terms. What is a sweepstakes casino and how does this form of gaming work? 

A sweepstakes is a type of competition where players get to win a reward for participating in a luck-based contest. The key defining characteristic of sweepstakes gaming is that it is free to enter. With sweepstakes gaming, players must be able to participate for free, even if there’s an option to enter the contest by making a purchase. The second aspect of this definition is that sweepstakes are luck-based. This means the winning chances of participating players are entirely up to luck and do not depend on their skill.

A casino that operates based on these conditions is known as a sweepstakes casino. On these sites, visitors can engage in a variety of luck-based casino-style games, which include slots and table games. However, they get to play and potentially win prizes for free instead of betting with real money. 

This is what sets them apart from traditional real-money gambling sites. On regular casino sites, players have to deposit real money, wager with it, and withdraw their winnings directly as real money. Gambling platforms that operate on sweepstakes models don’t use regular fiat currency. Instead, they use virtual currencies to wager on casino games and win more virtual coins. Some virtual coins are also redeemable for real cash, providing a way for players to receive real rewards for playing. 

Sweepstakes Casinos and Traditional Casinos: Main Differences

So what’s the difference between sweepstakes and traditional casinos? 

The main difference between sweepstakes and traditional casinos is in their method of entry. On traditional gambling sites, players use real money to wager on casino games and win real money in return. Sweepstakes operate on a free-entry principle, which means players don’t need real money to play. Instead, they use virtual tokens, which they can get for free. 

This core difference leads to different legal considerations for both platforms despite offering the same kinds of casino-style games. They also differ in terms of their social and psychological effects on players because of the difference in risks and rewards. Here’s an overview of some of the core differences between a sweepstakes casino and a traditional online casino. 

Legal and Regulatory Aspects

One of the primary benefits of sweepstakes gaming is that these sites are allowed to operate legally in most regions (including areas where traditional online gambling is restricted). The legality of sweepstakes casinos is mainly because they operate on a sweepstakes model which allows players to access casino games without using real money. 

Instead of real cash, players play with virtual tokens, which they can acquire through other methods aside from making a purchase such as sending a mail-in request or claiming bonuses. Without wagering real money, sweepstakes sites are technically not gambling sites. Instead, they are classified as promotional platforms. Consequently, they’re not subjected to restrictive gambling laws that prohibit or limit the activities of traditional gambling platforms. 

The legal accessibility of sweepstakes casinos makes them relatively easy to operate. It also makes them an appealing source of casino-style entertainment for players, especially in regions where traditional gambling is prohibited by law. However, operators must still adhere to specific sweepstakes laws and ensure compliance with all promotional regulations.

Market Trends and Growth

Sweepstakes casinos have been enjoying widespread popularity in recent years. According to the latest statistics, up to 55 million Americans engage in sweepstakes casino gaming yearly. The global sweepstakes industry is currently valued at about $73 million but may be worth up to $157.8 million by 2032 if the current projected annual growth rate of 11.5% is accurate. 

While it is still worth significantly less than the traditional online casino market (valued at $17.13 billion in 2023), Sweepstakes gaming enjoys a more conducive business environment. The popularity of sweepstakes is mainly because it doesn’t have the same villainous reputation that traditional online gambling sites have. People lose less money on sweepstakes sites and there’s a lower risk of gambling addiction, which makes it less risky to play. 

Consequently, many iGaming operators are venturing into the sweepstakes to take advantage of the conducive business environment and the abundant profits it offers. It’s considerably easier to start and operate a sweepstakes gaming platform since you have fewer regulatory hurdles to navigate. In fact, many governments have implemented initiatives that promote the establishment of sweepstakes gaming platforms due to their revenue-generating potential. 

The growing popularity of sweepstakes gaming with consumers is another reason why operators are trooping toward this form of casino gaming. Sweepstakes are an efficient tool for marketing and promotions. Businesses can use sweepstakes gaming to generate buzz, build awareness, and engage with their existing customers. 

Game Selection and Variety

Sweepstakes and regular gambling sites both offer casino-style gaming. This means you can find the same kinds of casino games and even specific titles from the same provider in the game library of both platforms. However, traditional casinos tend to have more casino games than sweepstakes sites do. 

According to a 2023 study carried out by the University of Nevada, the average online casino has over 500 casino games. The majority of these sites offer slot games, but they also have table games and live dealer titles. The same study shows that sweepstakes sites typically have an average of 200 games. These are primarily slots and table games like sweepstakes poker. Only a few sweepstakes gaming platforms offer live dealer games. 

It is worth noting that some of the most popular sweepstakes sites have just as many casino games (or even more) as traditional casinos. WoW Vegas for instance has over 1200 free-to-play casino games while McLuck Sweepstakes casino has over 700 slot games. 

Also, having fewer casino games takes nothing away from the experience in sweepstakes casinos. In fact, these sites typically incorporate innovative game mechanics and advanced features that are not typically found in traditional online casinos.

More specifically, social casinos focus on social or interactive elements, daily challenges, and leaderboards with interesting rewards to keep players engaged in addition to playing games. This combination of regular online gambling games with interesting social twists is one of the most significant advantages that sweepstakes casinos offer as it makes for a dynamic and engaging player experience. 

Demographics

There’s a notable difference in the demographics of players who play games on these platforms. According to data from the American Gaming Association, about 65% of players in traditional online casinos are under 40 years old. On the flip side, up to 42% of people who play social casino games are over 50 years old. This means sweepstakes gaming appeals more to an older audience, while conventional casino gaming is still more popular with younger players.  

Sweepstakes gaming caters to a broader demographic of players. Generally, experienced and active gamblers with bigger bankrolls tend to favor traditional casinos. The non-gambling nature of sweepstakes casinos makes it less appealing for such players. Sweepstakes sites attract a mix of casual players, social gamers, and curious beginners trying to learn the ropes of casino-style gaming. 

Many of the players in sweepstakes casinos are hesitant to wager real money. The broad appeal of sweepstakes gaming is great from a marketing point of view because it significantly increases your reach and user base. Sweepstakes casinos also tend to enjoy better player retention since they don’t need real money to keep playing. 

Social and Psychological Factors

Sweepstakes casinos offer the benefit of risk-free entertainment to players. Unlike traditional casinos, you won’t be wagering real money. This means there’s a lower barrier to entry and a much lower risk of losing actual money. On top of that, sweepstakes gaming does offer some potential rewards. You can redeem your coins (premium Sweeps Coins) for real money, gift cards, and other prizes. 

In traditional casinos, you gamble with real money, knowing that you may lose it. This high-risk-reward dynamic is part of the main appeal of this form of gaming, making it more thrilling for players. 

Sweepstakes gaming involves a lot less risk since there are no direct wagers. You do have the option to purchase more virtual coins with some money with the hopes of winning a prize. However, the experience is simply not as exciting as wagering directly with real money.  

Also, while it rarely happens, players sometimes get to win life-changing jackpots worth several thousands or even millions of dollars in conventional casinos. The odds of ending up with such a huge win on a sweepstakes site are significantly lower or close to impossible. 

Sweepstakes casinos make up for the lack of thrilling excitement by adding a social dimension to the gaming experience. These sites incorporate various forms of social interactions including chat rooms, leaderboard contests, and so on. These features add a layer of excitement to the regular casino gaming experience. 

Payments and Virtual Currencies

In a way, this is the biggest difference between sweepstakes casinos and conventional gambling platforms. In traditional casinos, players deposit real money into their casino account which they then use to place wagers directly. They also get to win and withdraw actual cash directly. 

Sweepstakes casinos differ from regular casino gambling sites in the sense that they don’t support direct money deposits. Instead, players use virtual currencies instead of real currency. Most sites offer two coin options (Gold Coins and Sweeps Coins). Gold Coins are free non-redeemable tokens, while Sweeps Coins are premium tokens. This means you can redeem them for real prizes. 

Social casino sites give players an abundant amount of Gold Coins as a welcome bonus. They may also get free Gold Coins through daily login bonuses, social media promotions, and other offers. Gold Coins are mainly used for entertainment purposes, so they have no real monetary value. You can purchase this virtual currency to extend your playtime, but it cannot be exchanged for real-world gifts or real money rewards. 

To get real gifts, you’ll need Sweeps Coins. The casino gives a smaller amount of sweepstakes coins as a welcome bonus and through some promotions. You may also get free Sweeps Coins as gifts when you purchase gold coin packages or win more in the casino by wagering with them. After meeting the rollover requirement, you can withdraw your Sweeps Coins from the casino as a real cash prize, voucher, gift card, or any other physical prize depending on the casino. This technicality allows sweep casinos to offer real money prizes without breaking gambling laws.

Why Are iGaming Sites Offering Sweepstakes Casino?

The legal accessibility of sweepstakes gaming is the main reason behind their rising popularity. Many iGaming sites are investing in creating sweepstakes casino sites because it is legally less difficult to establish. 

Social and sweepstakes casinos are allowed to operate legally in most of the United States, including in regions where traditional casinos are restricted and may even offer real money wins. As long as they adhere to straightforward sweepstakes laws, these casinos can continue to offer exciting games and an experience that’s similar to real money gambling without dealing with stringent regulations. 

But sweepstakes gaming isn’t exactly free gaming. Operators still get to make money from their social casino by selling virtual tokens to players or offering in-app purchases. Other methods of generating revenue through sweepstake casinos include advertising and partnership deals, further diversifying revenue streams. 

Sweepstakes gaming also presents an effective opportunity for marketing and promotions. Operators with some other existing products can reach a broader audience by offering real-world prizes to players through the sweepstakes model. Players get to enjoy casino-style entertainment while also exploring other products being promoted by the platform. 

Conclusion

Figuring out how to start a sweepstakes casino can be quite complex. However, partnering with a software development company with iGaming industry experience can make the process considerably easier. We offer sweepstakes software development solutions that help you get the best results for your business. Contact us to learn more about how we can help bring your sweepstakes casino ideas to life.