LARRY FRETZ
Vice President,
Gaming & Hospitality Research
Info-Tech Research Group

MONICA PAGTALUNAN
Research Specialist,
Gaming & Hospitality Research
Info-Tech Research Group

The effects of the pandemic are still apparent with operators most notably dealing with a shortage of labor and skilled labor, as well as health and safety customer concerns. When questioned, MGM’s CFO Jonathan Halkyard said pre-pandemic, the company had 4,750 full-time employees, but “We’re under 3,000 today. We will never go back to 4,750 full-time employees.” Casinos like MGM are forced to consider how they think about labor, services, and products because of the pandemic with a massive amount of learning (and investment) to contemplate. (Escobar, 2021)

FACTORS LIMITING OPERATIONS

Online gaming’s presence has dramatically outpaced the brick-and-mortar space during the pandemic making casinos wonder about their potential to cannibalize landbased operations. If anything, online gaming has made brick-and-mortar operators more vigilant and those that had already deployed online gaming more resilient. Everyone and everything is going online and so the answer seemingly lies in capitalizing “digital” in your own sector. There is a lot of pent-up demand to go out, socialize, and have fun, and therefore the objective is that when players come back to land-based casinos, they should not be disappointed in what they see.

IGAMING , REGIONAL GAMING , LARGE - CAP GAMING INDICES VS. SAP 500

(Global Gaming Business Magazine, 2021)

• A retail-only, cash-oriented gaming environment around largely similar games, mechanics and their mechanisms of delivery rather than the player experience.
• Inflexible and generalized loyalty tier player needs and preferences because of cumbersome and manual processes: Expensive and complex flow of data/interface to competitive and ancillary systems, fiat cash-in and chip/ticket-out, manual dealer responsibilities, tier-centric direct-mail, etc.

• Active awareness of VIP and loyalty tier player preferences, expectations and confidence levels that help to identify, analyze, and implement impactful initiatives such as contactless, cashless, and personalized offers.
• Develops a proactive approach for high-value implementations (i.e., big data, AI, and IoT) and revenue diversification (i.e., sports betting and online gaming)

• An omnichannel, hyper-personalized, consumer-focused, and adaptive gaming environment and experience focused around the player rather than the game.
• Configurable and adaptable based on player confidence, convenience, and experience preferences.

LOW LABOR, HIGH PLAY, EXPANDABLE PRODUCT

The casino is operating with less staff, but those staff members are trained and skilled at focusing on the player experience, creating value, and building loyalty. Removing the transaction of mundane tasks and taking advantage of automation opportunities allows the freedom to create a hospitable environment and differentiate the casino experience.

The casino encourages higher time on the device by providing a variety of games that attract different types of players and personalities. With digital marketing and hyper personalization in mind, the casino can also offer automatic promotions, further encouraging higher time on devices and coin-in by considering the player’s budget, personality, wins and losses, and betting patterns.

The casino can expand their product offerings to meet consumer expectations and preferences by accomplishing the connectivity that society demands. Players have the freedom to decide what and where to gamble and what currency to transact with and how. There is additional focus on non-gaming amenities to transition and convert consumers to the casino floor where games are fully downloadable and customizable to the personality and preferences of the player.

• Refer to the environment that the business must compete within.
• A key component of this trend involves laying the foundation for upcoming high-value implementations.
• To accomplish this, your environment must allow for the connectivity of systems and processes so that your organization is in a better position to take advantage of projects in the coming years.

• Refers to a system that sits on data to manage both operational and customer experiences with the ultimate objective of driving engagement for customers and the ability to make right decisions for operators.
• By enticing your guests with specific technology or trends, you’re enhancing the guest experience while driving present and future sales.

The enablement of data, open APIs and integration is the first step necessary to make the casino floor a “platform” as they allow for accessible data points, greater functionality, a better understanding of guest preferences, and the ability to act upon them.

The big data business pattern can be used to determine what data sources should be implemented in your casino architecture and which ones will dictate the data integration capabilities required to drive business decisions and make the player experience memorable.

Dependent on both algorithms and data, it can interpret information to identify patterns. The goal is to behave in a similar way to a human and enhance the speed of processes and date in real-time.

Dependent on the breaking down of data silos and integration, IoT is there to connect players and the casino through smart devices. For example, casino beacons are used to track player betting and spending habits then use the information to offer bonuses, promotions, etc.

Connectivity methods gaining visibility are 5G, Wi-Fi 6, and CBRS. Casino-as-a-Platform technology requires a strong technology infrastructure for both casino operations and customer-facing technology.

A broad multi-service infrastructure umbrella that involves Edge Computing, Software Defined Networks (LAN), and optimized cybersecurity that is required for omnichannel online and offline enablement.

Omnichannel converge through mobile engagement

The integration of mobile into the casino to steer toward an omnichannel approach that opens the door for an integrated and holistic iGaming and Sports Betting experience.

Rolling the dice on digital assets

Cryptocurrency and NFTs enable the play-to-earn model, a modern approach that can be leveraged to incentivize play on the casino floor.

Right player, right message, right time

The transition from traditional direct mail promotional methods to a digital marketing approach where operators can meet the players’ needs in real-time pre-visit, on the floor, and post-visit.

Revolutionizing traditional table games

Refers to the progressive, slot-like improvements of table games, including the ability to go “digital” and the emerging presence and usage of accurate data & analytics.

Where the casino floor adapts to the player

Unconventionally, the casino floor is beginning to adapt to the player and the desire for convenience through technology that meets consumer tech expectations, which expands options while lessening physical touchpoints, hardware, and interfaces.

Appealing to younger demographics

The pandemic heightened the millennial-to-Gen-Z cultural transition, and the industry is exploring what investments will successfully draw in this sociable and experience-loving demographic of the future.

Focused on understanding business imperatives of technology, seeking opportunities that are deemed necessary or provide crucial impacts to the business holistically.

Desire to understand the importance of the technology specifically for their own gaming function and how it could potentially eliminate pain points and boost productivity and player satisfaction.

Focused on identifying technical requirements and considerations when adopting technology solutions with the business’s context at the top of mind.

1. TRENDS RADAR CRITERIA
   • Business Growth — Drives sustainable growth, diversifies methods of generating revenue, and increases the business market reach.
   • Risk & Resilience — Mitigates and withstands rapid changes across the IT landscape, secures guest information while protecting brand assets, and easily integrates with current technologies, projects, and strategies.
   • Operational Excellence — Provides transparency and value to the guest, empowers associates, promotes teamwork, and improves responsiveness in problem solving.
   • Guest Value — Surprises and delights associates and guests, connects associates with guests on a personal level, and focuses on enhancing efficiency and convenience.
   • Brand Impact — Enables first-to-market or unique market positioning and assists in accomplishing strategic priorities.
2. BUSINESS CAPABILITY MAP CRITERIA
   • Competitive Advantage — Focusing on these capabilities will deliver differentiated end-customer experiences.
   • Cost Advantage — Focusing on these capabilities will help the organization derive operational efficiencies.

Business Capability

Defines what a business does to enable value creation.

Business Capability Map

Demonstrates a primary view of all these capabilities and provides details to a specific area of the business for further assessment.

Trend Impact

The casino integrated industry reference architecture on the right demonstrates the business capabilities that are impacted by all six trends on a competitive and cost advantage scale which has a role in how each trend is scored.

INFO-TECH-RESOURCES
Demonstrate the value of IT’s role in support your casino’s capabilities and assess your initiatives and priorities.

Integrated Casino Reference Architecture

• Customers within driving distance
• Earn a higher percentage of their revenue from gaming operations, especially slot machines
• Older demographics
• Frequented by gamblers several times a month or several times a week
• Less expensive to build and operate

• Tourists take a plane to get to property
• Earn a higher percentage of revenue from non-gaming operations such hotel bookings and food and beverage
• Younger demographics
• Frequented by gamblers once or twice a year
• More expensive to build and operate

Trends in the industry are changing how casinos must develop or renovate their current IT infrastructure to make way for technological improvement. Ensure due diligence during the integration process.

Rule of thumb: measure and assess your IT risks before implementing a new system

IT SECURITY & NETWORK

IT Security – Satisfaction that organizational devices and data are properly secured.

Network & Infrastructure – Satisfaction with reliability of comm. systems and networks.

Info-Tech Benchmarking Insight – The implementation of Casino-as-a-Platform technologies will require superior IT security and Network services and will therefore, increase the importance of IT Security and Network to the business and depending on IT’s maturity, could positively or negatively affect business stakeholder and player satisfaction.

DATA & ANALYTICS

Analytical Capability – Satisfaction with effective standard reports, custom reports capability, and the ability to generate business insights.

Data Quality – Put policies, processes, and capabilities in place to ensure that appropriate targets for data quality are set and achieved to match the needs of the business.

Info-Tech Benchmarking Insight – Business stakeholders must understand the value of data and analytics in making the right decisions. Satisfaction must be improved as personalization and understanding player identities will require the need of automation and real-time data and analytics to maximize the player experience.

INFO-TECH RESOURCES
Determine your IT and business stakeholder satisfaction

CIO Business Vision Diagnostic
IT Management & Governance Diagnostic
IT Staffing Diagnostic

THE OMNICHANNEL CONVERGENCE

Land-based casinos exist. Online wagering (iGaming and Sports Betting) exists. To fully capitalize on both, casino operators need to bridge the two and create an all-encompassing experience for their players. The COVID-19 pandemic has taught the industry that land-based casinos cannot solely depend on the brick-and-mortar product because consumers’ time over the last two years has primarily been spent online, gambling included.

There will be players who will strictly play online, and others who will come to the casino floor, but many players will take advantage of both options at their convenience.

As casinos participate in the online landscape, they are faced with two decision points based on the IT & OT maturity of the operations:

• Support the omnichannel model internally by building up an infrastructure and digital team, which can be considered a riskier and expensive approach.
• Partner with companies that specialize in the online market such as a sports vendor or online casino for less risk and capital spent.

Regardless, now is the time to look more seriously at diversifying into the digital world for the sake of relevancy, comparative strength, and revenue growth and resiliency.

12%

Grosvenor Casino’s digital revenue increase driven by the growth from omnichannel players (Rank Group PLC, 2021)

SPORTS BETTING & GAMING – RISING TIDE

The pandemic has revived Sports Betting and iGaming as additional revenue streams with state-to-state legality moving at a dramatically quick pace. Since 2018, for example, 80% of US states have live and legal sports betting activity in active legislation. States that have legalized these online mechanisms have seen an uptick in growth, which has led some governments, like Connecticut, to enact emergency sports betting and iGaming regulations as a “first step” toward a statewide launch. Certainly, these revenue streams bring new opportunities for operators, especially in states that require a licensed casino operation for sports betting and iGaming authorization. (Legal Sports Report, 2022)

SHIFT TO ONLINE

COVID-19 has dramatically increased the tendency for consumers to transact online, and therefore omnichannel commerce and convergence has blossomed. An example of omnichannel retail is Walmart, a company that connects their customers’ online purchases to their in-store visits to create a seamless experience. Cross-channel tactics include grocery pickup services, customer loyalty, account linkage to mobile devices for online and in-store alerts and notifications, and a wish list where customers can add desired products at home or by scanning in store. This reality highlights the pervasiveness of omnichannel for a wide variety of consumers and for high frequency/recurring transactions. These consumers will carry this expectation with them to the casino experience which raises the need for operators to shift partial focus to the iGaming and online sports betting world. (Waldron, n.d.)

OMNICHANNEL GROWTH IN THE GAMING INDUSTRY

Various gaming segments and their vendors have discovered the need for omnichannel to increase player engagement and innovative products and solutions have become more apparent to this day. The following news releases highlight its growth:

• In May 2021, Konami Gaming partners with Bet.Works, a US sports betting platform, launches an omnichannel platform aimed at bringing advanced casino loyalty promotions and offers to the players’ sports betting experiences. (Gambling News, 2021.)
• In October 2021, Aristocrat buys Playtech, a gambling software developer company, with the objective of being more flexible and scalable in the online gaming and sports betting space. (Bloomberg, 2021.)
• In November 2021, IGT links land-based casinos’ “Wheel of Fortune” with digital “Wheel of Fortune” progressives for a connected experience online and in-store. (IGT, 2021.)

US $766 M — Sports mobile bet flow in New Jersey in June 2021 (USA Today, 2021.)

US $122 M — Gross iGaming revenue in New Jersey in September 2021 (Casino Beats, 2021.)

Technology Signals

BUSINESS GROWTH

An omnichannel approach increases methods of generating revenue by increasing the operator’s offerings: players can bet or wager on the casino floor as well as a desktop, mobile site, or a downloadable app. For major casino brands, omnichannel opens revenue horizons for digital gaming spin-offs (i.e. “Wheel of Fortune”). This trend also increases the casino’s market reach by adapting to the preferences that digital consumers are adopting and allows for additional partnership opportunities.

RISK & RESILIENCE

With iGaming and sports betting gaining prominence, omnichannel methods (games, promotions, and digital wallets) will allow brick-and-mortar casinos to rapidly deploy online gaming platforms to jurisdictions where they have an existing casino footprint and to be more future-resilient from business disruptions such as pandemics and land-based operating challenges.

OPERATIONAL EXCELLENCE

In comparison to a multi-channel approach, omnichannel can reduce administrative overhead and improve data analytics and insights through a single back end for a better guest experience. On the floor, the difficulty will be loyalty staff answering player questions since online benefits and promotions change often.

GUEST VALUE

The adoption of this trend will offer convenience for the players with easy access to gambling and sports betting across desktop, mobile, and casino floor platforms. Further, the feature of a single player loyalty account and wallet across these platforms will add a connected and seamless experience for customers.

BRAND IMPACT

Omnichannel is a differentiator as it incentivizes players to engage with the brand across channels and keeps pace with the latest trends in how digital consumers behave. Additionally, the operator’s panoramic view of player activity enhances operator reputation by improving responsible gambling and facilitating AML checks.

DIGITAL TRUST ENABLEMENT

An omnichannel approach demands digital trust by credibly verifying identity and automating through a collection of customer identity attributes (payment, location, digital identifier, and unique customer data) across the digital wallet, player enrollment, and registration process, which increases player confidence while also enhancing the casino’s AML/KYC capabilities and reducing promotional fraud, chargebacks and player account takeovers.

OPTIMAL DATA COLLECTION

Brick and mortar data can only tell so much of a player’s story. Omnichannel will not only allow for better quantifiable information through player registration and activity tracking, but it also unifies both land-based and online player data. The casino can use this data to provide superior content and promotions to mass players but also enables hyper-personalization, tailoring the brand’s product, services, and marketing for individual players.

CLICK, THEN BRICK

A key advantage of omnichannel convergence for land-based casinos is the influx of online players walking through your casino floor. Offering casino games and sports betting online encourages those that registered and started out their player journey online to try out land-based play for the first time. This complementary benefit refutes the idea that online play will cannibalize brick and mortar casinos.

DIGITAL TRUST ENABLEMENT

An omnichannel approach demands digital trust, but how confident are your operations that you have sufficient digital trust controls in place without excessive transactional friction? It is necessary to evolve your processes into trust mechanisms or else player confidence will not be realized. Consider your threat landscape and risk appetite to develop actionable tools and programs that ensure digital trust.

ADDITIONAL COMPETITION

Adding sports betting and online gaming to the portfolio will introduce your casino to more competition that must now be considered. To increase the number of players knocking at your door, your operations must incentivize players to choose your product through optimal loyalty schemes, a well-designed app, and a frictionless user experience. This can further lead to the risk of overinvestment in the player to attract them.

COMPLEMENTS, NOT SUBSTITUTES

Mistaking a multi-channel approach over an omnichannel approach can be detrimental to the guest experience and the success of the brick and mortar product. It is important to consider the land-based and online channels as complements rather than substitutes. An omnichannel strategy should be complementary across products, customers, and lifecycles.

Elite Casino Resorts’ sportsbook first went live at its Riverside Casino and Golf Resort in August of 2019. Rather than outsourcing their sportsbook, they developed their own in partnership with Bet.Works to provide them with sports betting technology. But Elite Casino Resorts is a multisite and multi-channel operator, and therefore the difficulty lied in a disconnected player experience for gambling and sports betting, online and landbased.

At the end of May 2021, Bet.Works and Konami joined forces to create a tightly integrated omnichannel platform and interface. The objective was the ability to easily validate age eligibility, automatically enroll online and mobile sign-ups into a loyalty program, and seamlessly award casino loyalty points for all wagers, whether placed online, via mobile device, at point-of-sale (POS), or at a kiosk. Elite Casino Resort was the first casino to take advantage of Konami’s omnichannel solution across three of their properties: Riverside Casino and Golf Resort, Grand Falls Casino & Golf Resort, and Rhythm City Casino Resort.

Karlyn Ollendick, Elite Casino Resorts’ COO, states, “As a multi-site, multi-channel operator, we believe a consistent and convenient loyalty experience is especially important. The interface between Konami and Bet.Works allows us to achieve this aspect while expanding our entertainment offering.” In May 2021, prior to the implementation of the omnichannel solution, Riverside Casino saw online sports wagering of $1,268,995. and a retail sports wagering of $441,770. After the implementation of the solution, an increase in player engagement through online/offline and betting/gambling convergence of casino loyalty points was clear with an online wagering of $2,330,780 and a retail wagering of $593,782 in November 2021.

CURRENT STATE

CRYPTO AS A CURRENCY

As the name implies, crypto can be used as a currency. Types of cryptocurrency include Bitcoin, Litecoin, and Ethereum. The most land-based casinos have done to date is implement bitcoin ATMs on the floor. In this scenario, cryptocurrency enthusiasts convert their holdings into cash before wagering.

TOKENIZING THE BLOCKCHAIN

In similar fashion to cryptocurrency, non-fungible tokens (or NFTs) have more recently become yet another buzzword making headway worldwide. NFTs are distinct cryptographic tokens created from blockchain technology and can be anything digital of real or perceived value – drawings, videos, music, etc. NFTs work like any other speculative asset where buyers purchase in the hopes that the value goes up and eventually can be sold for a profit. With casinos hosting gift days and creating unique/collectable chips and cards, NFTs could be the next iteration of this concept.

FUTURE STATE

THE PLAY-TO-EARN MODEL (P2E)

For cryptocurrency, there’s more to value than a bitcoin ATM on the casino floor. For NFTs, regulators and operators need to have a solid understanding of the value it can bring which can be difficult for such a relatively young concept.
The traction that both crypto and NFTs are experiencing can be leveraged to incentivize play on the casino floor. The casino industry should fully embrace both by introducing the play-to-earn model, a blockchain term that focuses on patrons playing blockchain games and are rewarded through cryptocurrency (transactional) or NFTs (collectibles). For this to work, casinos (and game makers) must consider designing and implementing a blockchain-powered gaming machine that enables the play-to-earn model, which can improve loyalty and retention, increase time-on-device, and grow revenue. (Chan, 2021.)

US $2.32 B

2021 Q3 revenue generated by NFT games (Blockchain Gaming Alliance (Venture Beat, 2021))

CENTRAL CURRENCY

Central Bank Digital Currencies (CBDC) combine the same architecture of cryptocurrencies built on blockchain with the financial authority of a central bank. As cryptocurrency becomes more popular with increased competition from private companies, central banks are realizing that they need to support digital assets or risk getting left behind. As crypto experiences inevitable acceptance across the finance and government industries, game makers and operators will need to prepare for the inclusion of this trend on the casino floor.

CRYPTO GAMIFICATION

It all began with CryptoKitties in November 2017, where players began purchasing and breeding limited-edition virtual cats. By the end of December 2017, OpenSea, the largest NFT marketplace, was created, giving players more options of virtual collectibles such as trading cards, drawings, images, videos, music , etc. More importantly, it led to the increase in crypto gamification. Crypto and NFT gamification takes typical gaming elements like point scoring and applies blockchain technology supported by the play-to-earn model. As the gaming industry continues to grow with the addition of gamified blockchain (i.e., online casinos, videogames, and sports betting), land-based casino operators must find ways to leverage these elements on their own floor. (Portion, 2021)

The following news releases highlight this trend’s disruption:

• In January 2020, BOLT, a blockchain-based media company, launched the Stake feature where customers can predict the outcome of football games in exchange for BOLT crypto. (Mobile Marketing, 2020)
• In October 2021, Rollbit, an online crypto casino, introduced the Rollbox slot machine where players can wager to win other users’ NFTs. (Data Driven Investor, 2021)

A CASINO PAYMENT MECHANISM

There is worldwide acceptance of crypto as a currency in various industries including financial and retail. For example, Visa began their involvement with the launching of a prepaid cryptocard that customers can use at retailers that accept Crypto.com Pay including Time magazine and Travala. As the number of crypto-accepting retailers increase, we could see the potential of this payment mechanism rolling out for non-gaming-related areas such as food and beverage, hotels, and sundry stores. Many casinos have implemented crypto ATMs on the floor for players to convert their digital currency into cash. Over time, we are seeing growth in this area with the potential for slot machine crypto acceptance. In early 2021, IGT filed a patent for crypto transfers directly to and from player wallets. Soon enough, blockchain gaming machines that utilize the play-to-earn model will be developed for casino floors. Therefore, ensure your operation invests in intangible payment options for players as the first step in intangible value creation. (Investopedia, 2021)

50% — Percentage of video game developers that are weaving blockchain tech, cryptos, and NFT rewards into future games. (The Ascent, 2021)

1 million — Number of digital wallets connected to decentralized gaming apps. (The Ascent, 2021)

Technology Signals

BUSINESS GROWTH

A play-to-earn model can increase revenue and market reach by offering new reward options in the form of cryptocurrency or NFT collectibles. Players that want to earn these intangible products are incentivized to play at the casino and for a maximized amount of time, which drives revenue. The adoption of this trend at a casino will bring in players from various segments/demographics including young consumers, digital consumers, and fintech enthusiasts.

RISK & RESILIENCE

Because cryptocurrency and NFTs are still an emerging market, there hasn’t been significant initiatives to investigate AML or KYC requirements, which may discourage operators from implementing as it can impair the regulatory compliance obligations of the business. As the blockchain infrastructure becomes more widely used and mature, there is potential for improving security of the environment and promoting AML and KYC.

OPERATIONAL EXCELLENCE

This trend has minimal operational excellence beyond removing hard currency from the floor, but it does offer the ability for the business to feel empowered as it leverages blockchain technology to provide integrity of transactions and exceed guest expectations and increase loyalty and value to the business.

GUEST VALUE

This trend can incorporate a skill-based strategy, a concept that is popular among the younger demographics, which better engages players in the game and drives time-on-device. Players will appreciate the control as they play, a feature that is not included in games of chance. This trend also offers the ability to use preferred funding sources in a frictionless way as cryptocurrency gains more traction.

BRAND IMPACT

The play-to-earn model has yet to be incepted in the casino industry, but early adopters will offer a differentiating product compared to competitors. Further, an operation that offers NFT collectibles that are unique to their casino will increase brand awareness. Operators must also consider the general energy/environmental impacts of crypto (stemmed from mining) that can cause a negative perception on a brand (Example: Ubisoft’s blockchain initiative and the negative perception surrounding it).

SKILL-BASED ON THE FLOOR

So far, skill-based gaming has had a bad reputation in the casino industry because of its lack of return on investment. Operators often ask themselves, Is it an unsuccessful casino concept or just poor execution? Skill-based gaming is popular for young demographics. The play-to-earn transactional and collectible concept is also popular for young demographics. Coupled together, this trend makes for a successful casino concept and can influence proper execution for operators.

GAME ASSET INTEROPERABILITY

A casino participating in the cryptocurrency world opens their doors to the digital ecosystem, and moreover, the future digital world metaverse. For example, if a player is rewarded with an NFT collectible at the casino, the player can use this same collectible in another digital platform’s game or an NFT marketplace. This trend creates community by allowing interoperability between different applications, which is a truly innovative concept for both casino operators and players.

EMERGING CONCEPT

Early adopters will be seen as disruptors in the industry and will have a head start in revenue creation and loyalty retention. This trend is a proof of concept requiring testing, very high regulator involvement, and ongoing adjustments to develop a lucrative strategy.

LEARNING CURVE

Access to digital marketplaces requires a steep learning curve and a base level of technical knowledge. Operators, regulators, staff, and players will need to be trained on what digital assets are and how they add value to the casino and guests. Intangible value creation may provide new ways for casinos to engage with the younger demographic, but operators will have to consider those who have little knowledge and understanding of the topic.

EMERGING CONCEPT

According to ACAMS TODAY, casino operators would have medium potential for criminality (Gambling, cyberinfrastructure, crypto ATMs), meaning they can be linked to or used to aid in criminal activities. As an emerging concept, a casino that does not perform its due diligence in determining potential issues that could arise will result in benefits not being realized. (Bagnall, 2021.)

VOLATILITY

Digital assets are prone to volatile price fluctuations. For example, in June 2021, the NFT market suffered a 90% decrease in value and the companies that implemented NFTs within their games potentially suffered a great deal of financial loss. If accepted, casinos will need to consider its volatility for coin-in value and payout value. The effect can be detrimental to the casino industry if operators don’t develop extensive disclaimers, transparent policies, and terms of use regarding this volatility. (Winston & Strawn LLP, 2021.)

Play-to earn games like Axie Infinity have seen success in the gaming industry with the market’s revenue surpassing $2 billion. Virtue Gaming, a decentralized Ethereum platform, was intrigued as to what the blockchain model and technology could do for online poker in the US, an area experiencing legislative limitations in most states. In the US, only six states have legalized online poker, and the DoJ has banned the country from the global poker market.

To revive online poker’s presence in the US, Virtue Gaming proposed the P2E model, which would connect global players through a legal player pool. On December 10, 2021, the platform was unveiled with the following features:

• Peer-to-Peer Shuffling: To ensure security, the platform distributes the shuffling process among all players, applying a layer of encryption for each player (on each computer, separately).
• Controlled Wallet: Rather than depositing funds, the player transfers ETH from the wallet to the sidechain, a cashier made up of embedded smart-contracts.

The platform’s release has accomplished the company’s goal of bringing online poker back in the US.

Currently, Virtue Poker is only available to US players. If successful, the company plans to expand to Western Europe in 2022. Currently, the pool consists of 25,000 players, which is considered a successful result compared to Poker Stars’ revival that consisted of a 10,000-player pool. The company’s leveraging of the P2E model hopes to incentivize both amateur players and professional gamblers to join in on the experience.

CENTERING MARKETING ACTIVITIES AROUND LOYALTY

More recently, casino marketing promotions and offerings have been structured more around gaining loyalty and maximizing share of wallet on the floor rather than bringing in high volumes of guests. It’s important to note that it is after your guests have arrived that the main bulk of the marketing should begin because the ultimate goal is to get your players to stay and play on the casino floor for a long period of time. This trend focuses on real-time direct digital marketing to get your players to stay. Casino marketing is antiquated, focused on a direct-mail approach, commonly sending promotions and bonuses via email or print mail weeks after the player has already left the floor. The industry is still far from hyper-personalization but as the quality of data and power of analytics improves, brands can properly tailor their marketing to individual customers. Casinos should be leveraging behavioral attributes and real-time data to tailor offer messages for that exact moment.

Currently, there are two player stories that operators focus on when it comes to data:

1. Wins + Losses narrative,
2. Loyalty narrative.

Currently, neither knows about the other. The goal is to bridge the gap between these player stories because together they consider personality, budget, frustration, and bonus times, which can successfully encourage guests to stay on the casino floor in real-time.

21.8%

Percentage of respondents that increased the amount they gambled due to direct marketing [Direct marketing refers to: email, text message, or push-notification] (Blockchain Gaming Alliance (Venture Beat, 2021))

EMERGENCE OF HYPER-PERSONALIZATION IN DIFFERENT SECTORS

The casino industry is facing competition from non-traditional, digital-first brands in other sectors. In many cases, brands are already taking advantage of hyper-personalization, and casinos should not be left behind.

EXAMPLE | STARBUCK – RETAIL INDUSTRY

• Hyper-Personalized Customer Experience – Customers received a personalized in-app experience with real-time offers based on their preferences, activity, and past purchases
• Channel – Push and in-app notifications
• Approach – As part of its Digital Flywheel strategy, Starbucks uses a data-driven AI algorithm to send over 400,000 variants of hyper-personalized messages (food/beverage offers) to their customers, and promote unique and compelling offers for each specific member.
• Data Considered:
  • Contextual data (including location data, geospatial, demographic, and traffic)
  • Customer preferences
  • Customer activity
  • Past purchases
• Outcome – Marketing campaign effectiveness and incremental revenue via offer redemptions increased three-fold, with an estimated 25% of total transactions being conducted via mobile app.
(Example from Deloitte, 2020.)

HYPER-PERSONALIZATION IN THE GAMING INDUSTRY

Various gaming segments and their vendors have discovered the need for hyper-personalization to increase player engagement and innovative products, and solutions have become more and more apparent. Examples of vendor solutions include:

• Aristocrat’s ONE LINK: A wide area progressive solution that links slot machines and table games across an operator’s enterprise, using gaming and non-gaming data to offer promotional play, comps, or points.(Global Gaming Business Magazine, 2021.)
• Konami’s SYNKROS Advanced Incentive Engine: In real-time, the solution allows operators to build rules constantly and uses player transactions to reward patrons with free play, points, comps, or cash automatically. (Casino Review, n.d.)

90% — Percentage of customers who find personalized advertising appealing (Deloitte, 2020.)

Technology Signals

BUSINESS GROWTH

Retaining a loyal guest is often easier and less costly than attracting a new one, which is why this trend is attractive. Hyper-personalized marketing will likely lead to loyal and active advocates with a maximized share of wallet that can drive increased revenue through coin-in, time on device, and amenity spend. This trend also optimizes the marketing budget compared to traditional advertising methods by addressing a targeted audience rather then the masses.

RISK & RESILIENCE

This trend increases the amount of information collected about guests, making hyper personalization a future-resilient approach to retain players over time. When and how this data is used and secured should be transparent to the players.

OPERATIONAL EXCELLENCE

This trend offers the ability for the casino to feel empowered as it leverages digital marketing to automate the process in comparison to direct mail methods, boosting and maximizing productivity for the team.

GUEST VALUE

Hyper-personalization 2.0 improves guest value by making players feel special and known when interacting with the casino on the floor. Avoid non-relevant, mass marketing because players don’t want to be considered just another number. They react more positively in service environments where individuality and uniqueness is considered.

BRAND IMPACT

Adopting this trend will drive repeat patronage, attitudinal loyalty, and distinction by tailoring messages, promotions, and bonuses to individuals based on their player stories.

MOBILE ENGAGEMENT

Digital marketing makes use of mobile, opening the doors for more engagement online which provides the player with a more seamless customer journey. Because of its mobile involvement, this trend can go hand-in-hand with an omnichannel approach (Brick & Click Trend), offering bonuses and promotions for online/offline games for players that are either online or on the floor with the objective of getting them to play longer.

REAL-TIME DECISIONS

This trend empowers marketing messages to be sent to the players in real-time on the casino floor but a consideration that must be made is that the behaviors and attitudes of players can change rapidly on the floor based on game outcomes and other factors. With hyper personalization, operators can leverage a true 360o view of the customer to sense and detect these behavior and attitude changes in real-time and respond appropriately with the right offer message at just the right time to drive time on device and coin-in or amenity spend.

REMOVING ANALOG PROCESSES

A direct-mail approach is antiquated and requires operators to sift through loads of data and pay printing, mailing, and labor costs. Moreover, direct mail often ends with lack of visibility and minimal response. Updating to a digital marketing approach upgrades the casino’s overall loyalty strategy by improving visibility and relevance and increasing the likelihood of players taking advantage of promotions and bonuses.

SPAM INVASIVENESS

Hyper-personalization is important for a business but too many brands have been focused on mass marketing, which has led consumers feeling aggravated over irrelevant, ill-timed, even spam-like messages. Overcomplicating and adding unnatural friction to the encounter can lead to a messy negative guest experience so operators must ensure they balance branding and marketing with player perception and experience to ensure a low risk of invasiveness.

ALGORITHM CONTROL

Casinos need to be watchful of the algorithms that control hyper personalized marketing because poor quality or biased and misused data could lead to incorrect profiling or irrelevant messages. This inaccuracy will make players lose access to offers that they would have been eligible for, and cause disenfranchisement and loss of trust in the program and brand, hindering the overall guest experience.

PRIVACY

This trend will involve the personally identifiable data and information of players. The risk here is the concern guests have relating to how, when, and where data is used. In some cases, players may question the over-personalized messages they receive. Implementation of this initiative must consider GDPR & CCPA principles to ensure that data is being used in a way that benefits, protects, and is consented by the guests.

In 2019, Gala Bingo, an online bingo operator in the UK, began working with Graphyte, a hyper personalization software company, to improve player engagement. Like every online and offline casino, these sites and properties are visited by a diverse range of people, all with different preferences and preferred types of play. The issue revolved around the method of personalizing the experience to each player with Gala Bingo experiencing a 35% game turnover.

Graphyte’s Recommend and Intelligent Layouts platform was their solution to present the right content to the right user at the right time by including the following features:

• Based on each user’s preferences and history, add real-time product recommendations and create a Netflix-style experience on the website, arranged by custom categories such as themes and game types.
• Send personalized emails and notifications based on player preferences and behaviors to encourage more play.

Gala Bingo experienced the following results:

• Increase in site visits by 300% compared to site visits from static emails
• 7% conversion uplift for their new games
• 5.6% uplift in Revenue Per Visitor (RPV)
• 7.3% uplift in conversion rate
• 9.8% click-through rate

The success of this software has encouraged Gala Bingo to continue their brand makeover, with their brand owner, Entain, extending their gaming contract in October 2021. This collaboration includes Entain’s other brands – Foxy Bingo, Foxy Games, Gala Spins, Gala Casino, and Cheeky Bingo – demonstrating their satisfaction with the software company.

AT LAST, DESIGNING SLOT-LIKE IMPROVEMENTS

In terms of features and improvements, slot machines have gotten a lot more love, boasting rich data sets to analyze, 4K resolution, 4D immersion, large signage, etc. Table games have become the outlaw, excluded from the benefits of technological innovation because of many operators’ slow pace of change. Because of the pandemic, more and more casinos have started to embrace the elements of the Smart Pit but it still needs to gain more traction in the industry. For many, processes have stayed largely traditional.

The Smart Pit consists of four key features that make for optimal operations:

1. Player Attraction – Incorporates an additional four types of play to the casino pit:
   • Fast Game – Appeals to those who don’t want to wait and want consistency and the possibility to play by themselves
   • Privacy – Appeals to those who want the screen to themself with betting privacy
   • Learn to Play – Appeals to those who find other players intimidating or abusive when they’re making decisions
   • Affordability – Appeals to those who want to play a cost-effective game
2. Dealer Efficient – Mundane tasks are removed with the dealer’s function no longer involving handling chips and cards. Rather, the primary function is trained customer service, focusing on entertaining the customer.
3. Accurate Data & Analytics – Ability to execute slot-like analytics to reduce dealer errors and to adjust future game mechanics for optimal efficiency.
4. Maximized Security – Easy recognition of frauds sitting at the table enabling efficient removal from the game.

“It’s attracting a lot of players who were intimidated to walk up to a craps table or a blackjack table and get yelled at for splitting tens” (John Connelly, CEO of Interblock (Gaming America, 2021))

SLOT MACHINE UPGRADES

Slots have gone through evolutionary transformations throughout the years. Up until the 1990s, slot machines still operated with coins and required a lever to spin the reels. Every year, vendors release new features, which demonstrates the fact that slots are not even at their technological peak yet. Slot machines will continue to be innovative, and operators will continue implementing. In the end, table games will need to go through the same changes on the floor that slot machines are seeing. This means change is needed in the casino pit.

INDUSTRY'S STAFFING SHORTAGE

The hospitality industry continues to face a staffing shortage, especially casinos that are struggling to meet growing demands. Because of the pandemic, many former hospitality workers are considering leaving the industry. A larger workload put on less staff can lead to dissatisfaction, which guests will notice. The adoption of smart pit features, like electronic table games, presents an opportunity to solve the labor shortage challenge by:

• Eliminating valueless processes and tasks
• Driving operational efficiency
• Operating more games with fewer staff

Technology Signals

“Some people moved from hospitality to something else. Some like their new life and they’re not going back to hospitality as easily as employers would like them to.” (Jeff Waddoups, UNLV economist (Vegas Inc., 2021))

BUSINESS GROWTH

By adopting this trend, operators can minimize errors, improve security, and maximize floor space and table limits through flexible configurations which, in turn, increases revenue and reduces unnecessary operational costs.

RISK & RESILIENCE

The pandemic is still relevant as a society with respect to staffing shortages, digital player expectations, and consumer wariness of groups and crowds. The Smart Pit is a future-forward, resilient strategy that involves technologies that can help table game operations bridge labor gaps, digitalize the game experience, and allow socially distanced play or minimal players at a table.

OPERATIONAL EXCELLENCE

An originally labor-intensive activity with inefficient manual processes, the Smart Pit eliminates mundane tasks and reduces dealer payout, over comp’ing, player rating errors, and decreases staffing costs.

GUEST VALUE

The Smart Pit’s additional four types of play – Fast Game, Privacy, Learn to Play, Affordability – can attract and satisfy a broader spectrum of players. Additionally, accurate bet recognition reduces guest dissatisfaction due to dealer errors. Also, the technology can bring the “wow” factor through ETGs’ video-like capabilities and animations.

BRAND IMPACT

More and more operators are implementing these technologies and eventually they will become casino staples so it may not differentiate the brand. It can, however, strengthen the brand’s identity by adding “digital” to the floor, avoiding distasteful guest reactions from high digital expectations.

OPTIMAL FLOOR MANAGEMENT

Operators are looking to find ways to optimize casino floors by leveraging technology and innovation. The inclusion of electronic table games is one of them. The industry is migrating toward a strategy where ETGs are for lower table minimums while traditional live table games are for players with higher bets, which is attractive to many players, especially those that are looking for a fast, cost-effective, and less intimating way to play.

SLOT-LIKE DATA & ANALYTICS

A major pain point of the traditional table game for players and operators is the lack or inaccuracy of real-time trend data, wagers, and payouts. Influenced by its slot machine counterparts, Smart Pit’s recognition technology takes away this disadvantage by removing manual dealer processes and improving data accuracy and analytics.

TABLE GAME LAW ALTERNATIVE

Smart Pit’s electronic table games are omitted from local gaming laws that do not permit table games. It serves as an alternative to the traditional table game if laws permit electronic gaming. For example, New York, a state that is not permitted to have table games (excluding tribal casinos), implemented ETGs so that New Yorkers wouldn’t have to drive down to Atlantic City or Pennsylvania for this product. The result was phenomenal – it was clear there was a large volume of unmet demand.

BALANCING ACT

With ETGs, there is a digital dealer or one live dealer that serves dozens of tables. This can save on labor, but it may detract from the player focus and experience as it could lead to reduced interaction going from say, three dealers to one dealer in a traditional craps game. Further, no dealer eliminates staff-to-player interactions completely. Similarly for bet recognition modules, large cameras that tower over the table can be distracting and can make players feel uncomfortable.

INCORRECT MEASUREMENT OF SUCCESS

Although many casinos are understanding the advantages of ETGs, there are others that consider it a lackluster technology that doesn’t have a significant enough ROI, especially when revenue per square footage is involved. It becomes important for operations to consider floor space optimization. Operators should also examine why their floor wants ETGs in the first place. For example, if the rationale behind its implementation has to do with the ability to close the pit overnight and save labor, then ensure that your operators are looking at its performance overnight (in comparison to historical performance) rather than during the day.

COST-BENEFIT

Smart Pit’s recognition systems (bet, body movement) are emerging POC technologies. Further, the challenge is the technology’s integration into existing systems. For example, how does it integrate with the casino’s current rating system? There is a cost-benefit risk of having to change out all necessary software and hardware especially for an emerging piece of technology.

On September 14, 2021, Eldorado Resorts completed its US $17B acquisition of Caesars Entertainment Corporation and made it clear their forward-looking strategy primarily involved cost-efficiency. The accelerated move from table games to machines and reducing table game dealers ranks as one of these initiatives. Post-acquisition, Caesars was in the process of reducing the number of table games on their casino floors with the biggest reductions at Cromwell (41%) and Harrah’s (32%) in Las Vegas. The traditional games were replaced with electronic table games.

A great example was their implementation of the digital craps table, which uses the same footprint as a standard craps table but includes LED panels for graphics and animations. With this new technology, no physical chips are used. Instead, players can make bets with virtual chips through the screen. Shortly after implementation, Dan Walsh, SVP and General Manager of Harrah’s las Vegas stated, “We anticipate our guests will gravitate toward the game’s approvability and exciting features. We strive to provide the best products and technology to our customers, whether experienced or novice.”

The implementation of ETGs like the digital craps table have proved to be a success on both an operational and guest standpoint. Their digital craps tables are packed because of their visuals, lower table minimums, and reduced touchpoints. Operationally, they are less labor-intensive and rely more on player stations for a breakdown of odds and rules rather than the need for dealers, which increases cost-efficiency and productivity. Its success has encouraged the future roll out and expansion to other properties with Kerry Whitney, VP of Table Games at Caesars, stating that digital craps will soon be implemented at the Linq. Since the strategy has been in place, Caesars Entertainment’s direction has shot up with the stock up 167% over the past year!

THE CASINO FLOOR MUST ADAPT TO THE PLAYER

Significant investments should be made for technologies that:

• Expand player options and lessen physical touchpoints, hardware, and interfaces to enhance the service convenience aspect of the casino’s offerings.
• Meet consumer technology expectations since there is a high level of technological familiarity within their day-to-day lives.

The Consumer Adaptive trend consists of three components that holistically fulfill consumer preferences and expectations on the casino floor:

Access Adaptive: The operator gives access to both gambling and non-gambling activities through technological interaction with one piece of hardware. For gambling, an example would be the server-based downloadable machine that offers games from several providers, giving the players the option of what they want to play, where they want to play it. For non-gambling activities, this interaction would be with a mobile app that gives players access to amenity viewing and bookings across the casino and/or resort (i.e. food and beverage, spa, etc.). Another example is a personalized gifting program integrated with the casino’s gaming machines that lessens the expenditure of time and effort for the player compared to the usual process where the player is waiting in line.

Transaction Adaptive: The operator provides a transactional solution that lessens the expenditure of time and effort (friction) for the player. A digital wallet that allows players to pay on the app for slots, table games, restaurants, hotel, etc. enables the consumer to efficiently and conveniently assume possession of the products and services they require.

Technology Adaptive: The operator consistently upgrades their offerings to specifically accomplish consumer tech familiarity. One emerging innovation that operators should take advantage of is the advancing technology in slot machines. It has paved the way for a better, more immersive experience for players. Many of the recent innovations have been focused on the cabinet but incorporating 4k resolution, LED lights, unique screen contours and format, and improved sound to keep guests in their seat longer. Another example is the use of digital signage to create a converged and immersive experience on the casino floor such as a triggered jackpot celebration.

“Service convenience can be thought of as a means of adding value to consumers, by decreasing the amount of time and effort a consumer must expend on the service.” (Scott Colwell, University of Guelph (Journal of Services Marketing, 2008))

CONSUMER ADAPTIVE ON THE CASINO FLOOR

ACCESS ADAPTIVE

• Mobile app
• Gifting technology
• Server-based downloadable games
• Multigame table
• Multi-denom game

TRANSACTION ADAPTIVE

• Digital wallet

TECHNOLOGY ADAPTIVE

• Innovative slot cabinets
• Digital signage

FUTURE EXPECTATIONS STEMMED FORM THE PANDEMIC

1. It is the recurring objective of all industries to invest in consumer trust initiatives so that confidence levels increase. Because of this, many companies have digitalized customer-facing technologies to increase service convenience and lessen physical touchpoints, hardware, and interfaces.
2. Overtime, the typical consumer lifestyle has become digital. Consumer increase in digital dependence has been a phenomenon for quite some time with the pandemic shifting behaviors and preferences even further. During this time, consumers looked to devices to get them through lockdowns and restrictions, easing their boredom and giving access to control and convenience at home. In fact, online banking and bill payment due to lockdowns and restrictions increased trust and confidence in personal and financially sensitive transactions. Leverage emerging technologies to give the casino industry the ability to adjust services to digital preferences and eliminate a potential decision barrier for consumers.

CABINET INNOVATIONS

Games are competing for attention more than ever. With interest in mobile gaming and nongaming attractions growing, slot machine manufactures are doing all they can to attract players, with several manufacturers bringing in 360-degree displays that immerse a player in the world of the slot. Disruptive features that operators must consider include 4D, 4K, facial recognition, comfort/convenience chairs, UVC lighting, edge displays, and individual signage.

Consumer Adaptive Signals

BUSINESS GROWTH

The primary role of being consumer adaptive is to serve a wider market by adapting to guest confidence, convenience, and experience levels that consumers are adopting. Additionally, casinos that take on the consumer adaptive initiative could realize increased revenue since the consumer would be able to view a variety of products and offerings by interacting with just a single technological interface.

RISK & RESILIENCE

By adopting this trend, operators can steer away from outdated processes and toward a future-forward, modernized structure that uses technology to create convenience and efficiency for both staff and guests. As a trend that relies on integration between systems (Amazon, slot machines, etc.), it becomes a data-pump for improved analytics. Moreover, these advantages help improve resiliency as they provide new ways to adapt to the next normal, where customer experience is imperative to remain relevant.

OPERATIONAL EXCELLENCE

The casino shifts the work to the players by giving them more control of their environment through personalized but automated touchpoints. This brings operational efficiency and a higher level of productivity by removing unnecessary tasks and interactions, freeing up time for staff to focus on other aspects of the job.

GUEST VALUE

Embracing the Consumer Adaptive concept lessens the expenditure of time and effort (friction) for players while expanding their product and service options, adding value to the consumer experience by improving service convenience.

BRAND IMPACT

Marketing a variety of products and services using a single touchpoint or hardware gives the operator the opportunity to focus in on branding that interface, which will strengthen the brand’s identity.

LABOR ADAPTIVE

Consumer adaptive is self-explanatory; it’s to adapt to consumer preferences. But there’s more than meets the eye for these technologies. The casino industry has seen a labor shortage for quite some time now. What makes this trend’s technologies so labor adaptive is that they can remove mundane tasks and inefficient processes, thereby providing flexibility to the labor market’s ebbs and flows and the needed headcount for operations.

PLAYER CONTROL & CHOICE

On a single interface, this trend gives players control of the environment, allowing them to choose their preferred products and services. Doing so gives them full personalization and customization of their experience, which brings guest satisfaction and positive emotional reactions.

THE (CONSUMER) NEED FOR SPEED

The extent to which the modern consumer is expectant of digital experiences is increasing in a commensurate fashion with the pace of business. The organization must cater to these expectations in order to remain competitive. The casino industry can keep up with this pace and meet guest expectations by implementing consumer adaptive technologies.

VENDOR RELATIONS & INCOMPATIBILITY

A consumer-adaptive trend will require the communication and integration of multiple suppliers, protocols and games included. For example, a server-based downloadable game involves one single machine, but it is preferrable to include games from various vendors. Protocols and patent license agreements are huge barriers to cross-vendor games. If technologies are incompatible and there are no cross-vendor capabilities, this will pose an issue to the success of the initiative.

BALANCING UX

It is vital that the user’s screen adapts and responds appropriately to changing conditions but there are challenges in accomplishing targeted relevance and successfully automating content changes through analytic, content management and IoT systems. A proper consumer-adaptive strategy will require a balance between privacy and AI or else be faced with a messy negative experience.

TECHNOLOGICAL ALIENATION

These technologies might not resonate well with some players because it may be confusing to them. Another issue is if they don’t want to use it. Consider the requirement for mobile devices. If a digital wallet is implemented at the casino, it requires the guest to download the casino’s app to activate the wallet. What if they don’t want to download the app?

After analyzing American Gaming Association’s statistics stating that more than 60% of casino gamblers want a “contactless” payment option and that casinos are one of the only cash-based industries left in the US, Sightline Payments Co-CEO Joe Pappano stated, “Our industry must modernize its payments infrastructure to keep up with consumer preferences.” With this mind, Sightline partnered with Resorts World to launch a digital wallet where you can pay for anything onsite.

Gambling and non-gambling products and services could be purchased with a digital wallet using the property’s mobile app. The solution would give flexibility to the guests to transfer funds seamlessly between the wallet and the linked external funding source without the patron having to leave their seat. On the gaming side, Resorts World could accomplish this by implementing slot machines and table games that include the cashless feature. Rick Hutchins, SVP of Casino Operations for Resorts World, states, “Through our partnerships with best-in-class gaming technology partners, we will offer our guests a fully integrated experience, not just on the gaming floor, but across the entire resort.”

This cashless initiative has made the company the first casino in Las Vegas to allow a digital wallet to fund table game play and slot play from one solution. This offering brings service convenience to the players by being both access and transaction adaptive. The American Gaming Association CEO, Bill Miller, states, “Resorts World operators said they would have been doing an unbelievable disservice if they didn’t incorporate payment modernization. They didn’t just build a casino. It is a modern version of a casino.”

BORN BETWEEN 1997 TO 2012 – GEN Z IS THE DEMOGRAPHIC ON THE FUTURE

The segment is expected to make up 27% of the workforce by 2025, which means that they will also be the future of spending power. An important reality that casinos must face is that this demographic has less appetite than their parents and grandparents to spend on casino games. It’s not to say that Gen Z won’t play slots or table games – it will just take some convincing. Operators should make changes to the environment and offerings to successfully convert the player to the casino game experience.

The two main needs of Gen Z:

• Digital Capabilities: As digital natives that are always looking for the next “big thing” in technology and desire seamless technology integration in their daily lives, companies are forced to continuously upgrade products and services to appease this large generation segment.
• Socially Shared Experience: Like their millennial cousins, social media is this demographic’s major influence for decision making, so companies must develop memorable experiences to accomplish the FOMO (fear of missing out) factor. They enjoy seeing other people’s experiences on social media platforms and this influences them to encounter the same experiences.

Ready Player Z wants to uphold these two needs by implementing two components into the casino environment:

• Multimedia: Develop an immersive, thematically linked and interactive environment through technologies like augmented reality that can add value to the customer journey and provide digital engagement for the casino’s players.
• Multi-Entertainment: Develop an entertaining experience – not an average experience – by embracing and adding social non-gambling activities to the floor such as an eSports lounge, nightclub, and an arcade.

Use a multimedia environment and a multi-entertainment experience to funnel these consumers through the door. Once inside, operators can work to get them on the casino floor.

“Winners and losers across the casino industry will be determined by who recognizes this population and pivots to engage them.” (BMM Testlabs, 2018)

ENTERTAINMENT INDUSTRY INTERFERENCE

The entertainment industry has really locked in the Gen Z demographic as they crave a social, interactive, and out-of-the box experience. The casino industry is less prepared to go after this demographic from a gaming perspective and has seen an intense disruption from this competitive sector. Operators should not try to compete with the entertainment sector but instead embrace the activities that this generation seeks including eSports, Sports betting, night clubs, and arcades.

For example, TikTok has particularly taken off during the pandemic and has captured the attention of young generations by exposing songs, dances, and trends as a way to stay connected. The 1720 venue in L.A. hosted an Olivia Rodrigo Night on July 15, 2021, honoring the famous artist whose songs have been the basis for many TikTok dance routines. And so, it made sense that young Gen Zs would flock to the event so they could routinely dance to her TikTok-famous songs. (Flood, 2021.)

IMMERSIVE EXPERIENCES IN DIFFERENT SECTORS

To engage with the Gen Z generation, brands are starting to amplify their products and services with technology that pushes boundaries. To win over this young demographic, companies are starting to look at providing immersive experiences.

Immersive Art. Consumers have become accustomed to technology and museums are understanding this. Museums have historically had a hard time marketing to young generations, so museums have harnessed digital technology to provide immersive experiences. For example, the Van Gogh Exhibit boasts 600,000 cubic feet of projections, 60,600 frames of video, and 90,000,000 pixels to fully immerse guests in the experience, a successfully proven method to attract the younger demographics into the facility.

Augmented Reality. Many business are making use of augmented reality including hotels. In fact, Apple has become more serious about AR glasses with a potential release in 2022. This launch signifies the need for all industries, including the casino sector, to continue pushing out new technologies and immersive experiences into the marketplace to keep up with demographic expectations. The next phase of augmented reality is the metaverse. The potential for casino involvement in this new reality is staggering with 60% of Gen Z stating that brands should sell products and services on a metaverse platform. (Wright, 2022.)

94% — Percentage of Gen Z and millennials saying they plan to go to festivals, plays, museums, and concerts due to pent-up demand to return to events. (Vice Media Group, 2021)

54% — Percentage of 18–24-year-olds that appreciate brands that “connect with them in new and innovative ways” (Verizon Media (Voxburner, 2021))

60% — Percentage of Gen Z-ers that believe brands should sell products and services on a metaverse platform (Obsess Study (The Drum, 2022))

58% — Percentage of Gen Z-ers that play games (99 Firms, n.d.)

EVENTS GEN Z LOOK FORWARD TO AFTER THE PANDEMIC

BUSINESS GROWTH

With the casino industry’s primary demographic being the older generations, this trend can increase market reach by being able to attract young gamblers. Also, since the goal is to incorporate a social atmosphere, this can potentially increase revenue for non-gaming revenue streams such as F&B.

RISK & RESILIENCE

Adopting this trend will require a multimedia and multi-entertainment environment for the purpose of reinventing the gaming and non-gaming floors. This initiative will improve resiliency since it is a way to adapt to the younger demographic’s needs, preferences, and desired experiences, which is imperative to remain relevant in the industry.

OPERATIONAL EXCELLENCE

This trend is not a driver for operational excellence, but it does offer the ability for the business to feel empowered as it leverages multimedia and multi-entertainment technologies to attract younger demographics into the casino.

GUEST VALUE

The role of this trend is to provide various forms of engagement to keep guests interested and exceed their expectations. From the guest perspective, seeing these technologies and taking part in these activities is supposed to provide the “wow factor” they desire.

BRAND IMPACT

Not many casinos have tugged on the heartstrings of the Gen Z demographics yet so those that do will create brand distinction. As a differentiator, it invites guest attraction, satisfaction, and retention.

THE (CONSUMER) NEED FOR SPEED

The extent to which the Gen Z consumer expects digital experiences is increasing in a commensurate fashion with the pace of business. The organization must cater to these expectations in order to remain competitive. The casino industry can keep up with this pace and meet guest expectations by considering the Ready Player Z trend.

DRIVING A HOLISTIC CASINO EXPERIENCE

A casino’s objective is to create an optimal and seamless guest experience throughout the guest’s stay. This strategy will force operators to look at the guest experience holistically and understand the demographic’s casino needs on both a gambling and non-gambling level. In the end, Gen Z guests will need more than just casino games, and this trend demonstrates that other forms of social and entertainment activities are just as important.

CASINO PLAYER CONVERT

The Ready Player Z trend is meant to get guests through your door through social experience incentives. It becomes a starting point and as guests try out the casino floor, they can be converted through casino offerings that appeal to this young demographic. As digital natives, Gen Z consumers would be interested in the mobile engagement aspect if the casino offers online channels for iGaming and sports betting. As a demographic that enjoys video games, they would be interested in skill-based games.

DESIRED CONTEXTUAL EXPERIENCE

As a trend that focuses on a multimedia environment and a multientertainment experience, ensure that it is planned well with the right themes, activities, floor layout, and design. For example, to attract young guests, Casino Du Lac-Leamy focused on their floor layout. Upon arrival, guests immediately have a panoramic view of the entire floor – seeing both the gambling and non-gambling activities. This strategy mesmerizes guests and encourages time at each amenity. (Interview with Anonymous Contributor)

AMENITY BALANCING

A multimedia environment and a multi-entertainment experience may not bode well with some players because it may be deemed too noisy or may not resonate with their casino expectations and needs. Balancing gaming and non-gaming amenities will be a risk that operators will have to consider when it comes to strategy execution.

INITIATIVE COST

The cost to retrofit a casino floor layout is high. For this trend, you’re looking to build an entirely immersive and social program if your casino wants to realize the most optimal return. The risk is failed approval because of the initial cost of the opportunity. Follow best practices to ensure that your business case includes an optimized cost-benefit analysis to demonstrate the strengths of the approach and what can be achieved if implemented.

Groupe Partouche, a French leisure group that owns and manages European casinos, was determined to reinvent its established facilities, believing that the quality of machine hardware was simply not enough to satisfy the high expectations of consumers. Customers want digital and therefore, the goal was to redesign its casinos to bring something “extra” to the gaming experience.

Groupe Partouche began its investment campaign with its Parisian casino, Pasino Grand, using the facility as a proof of concept, rolling out various immersive and projection mapping experiences interiorly. In collaboration with Canadian multimedia studio Moment Factory, they designed a multimedia-based infrastructure to include content programming, interactive gaming and four thematically linked scenography panels.

The group’s project proved to be a success with countless visitors experiencing a world of magic and immersion across their casino visit. Its success allowed the company to continue with its redesign campaign in their first few months of the 2020-2021 fiscal year, developing an outdoor casino at PleinAir in La Ciotat, and renovating the Royal Casino for an immersive and themed experience.

TRANSFORM STRATEGIC FORESIGHT TREND INSIGHTS INTO ACTIONABLE INITIATIVES BY DETERMINING WHAT TECHNOLOGY YOUR CASINO SHOULD PRIORITIZE AND HOW TO PERSUADE STAKEHOLDERS FOR APPROVAL

Dealing with trends is one of the most important tasks for innovation and digital transformation. It provides the basis for developing the future orientation of the casino. However, being aware of a trend is one thing. Developing a strategy for response is another. Info-Tech has evaluated and chosen trends that are important in different capacities. At this point, your casino should determine what technologies are applicable to it.

Your strategy should involve the following steps:

1. Prioritization: Info-Tech began this step for you by determining the general impacts of the trend for the industry and the technologies available in the space. Now, it’s your turn. Which technologies should you prioritize?
2. Alignment: After determining what to prioritize, establish the benefits of the trend that closely aligns with and promotes the success of your business goals.

IMPACT

The degree of impact the trend will have on your industry. A trend with high impact will drive new business models, products, or services.

• GAMING DRIVERS
• BUSINESS CAPABILITIES

Horizon scanning done by Info-Tech to determine the impact of these trends on the casino industry

Further customize this score depending on:

• The mutual exclusiveness of each technology. Does it fall in multiple trend buckets that further benefits the industry, making it more available, applicable, and impactful for the casino than originally intended?
• The specific technology that’s being analyzed. Analysis was done for the trends as wholes, but these scores could vary depending on the specific technology that’s being analyzed.

RELEVANCE

The relevance of the trend to your organization. Does the trend fulfill the vision or the goals of the organization?

Decide your score based on:

• Technology’s impact on casino classification: Market type, target segments, and location. In other words, what are your guests’ needs and expectations?
• Comparatively, does this technology conflict with other implemented technologies? In other words, does it provide redundant applications and features, and could you do without it?
• Projects and Requirements Gathering: Will this technology satisfy the needs of your business stakeholders?

TIMING

The estimated time to disruption this trend will have to your industry.

Decide your score based on:

• Assess whether the trend will require significant developments to support its entry into the ecosystem
• Assess your casino’s budget to implement the solution.
• Are there regulatory challenges?

• People. Implement programs to enhance the recruitment, talent management and development, as well as diversity and inclusion, to support the achievement of key business drivers including guest experience, community engagement, and financial goals.
• Operational Excellence. Exceed customer expectations through tailored experiences, innovative solutions and quality service to maximize financial results.
• Growth. Execute a targeted approach to growth to become a premier global omnichannel gaming, hospitality, and entertainment company, increasing global brand presence in international markets and through establishing ourselves as a data-driven company focused on identifying high-value customers, enhancing guest experiences through technology and service, growing brand loyalty, and capturing greater market share.
• Capital Allocation. Disciplined investment of cashflows in growth opportunities

TRENDS REPORT

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BOB B Y SOP E R
President & CEO
Sun G&H

DAVID CROFT
General Manager – Product & Strategy
Star Sydney

JOHN ACRES
Founder
Acres Manufacturing

LANCE ALLEN
VP of Table Games
Firekeepers Casino

LANCE YOUNG
EVP & General Manager
del Lago Resort & Casino

LARRY FRETZ
VP of Gaming & Hospitality Research
Info-Tech Research Group

TOM SOUKUP
SVP & Chief Systems Product Officer
Konami Gaming, Inc.

THOMAS CASTLEBERRY
VP of CXS Strategic Initiatives
Aristocrat Technologies

ANONYMOUS CONTRIBUTOR
IT
Casinos du Quebec

ANONYMOUS CONTRIBUTOR
Table Games
Niagara Fallsview Casino Resort