This is Part 1 in a series on the convergence of the games and casino industries and how non-casino game developers can get involved in emerging areas of the casino industry. This article focuses on mobile gaming. Part 2 focuses on skill-based games. Part 3 covers esports and virtual reality.
The casino industry is undergoing a bit of a renaissance. With demographics in casino patrons rapidly changing, casinos are looking at ways to engage with younger audiences through the things they love as well as keep older patrons engaged even away from their properties. As a result the industry is starting to see more innovation than it has in years.
This was clearly evident at the recent Global Gaming Expo (G2E) conference in Las Vegas. One of the hot topics many casino operators and manufacturers discussed there was mobile integration and services – whether it be social casino, real money gambling (RMG) gaming, mobile services, or even taking mobile games and adapting them for the casino floor.
In a panel titled Interactive in Indian Country: iGaming, eSports and DFS, Eilers & Krejcik Gaming Senior Consultant Chris Grove noted that social casino will be an estimated $3.5B industry in 2016. Additionally, social casino pioneer Playtika was recently sold for $4.4B and 70% of social casino revenue comes from mobile devices.
In the same panel, GAN Vice President of Sales & Marketing Dana Takrudtong said that commercial casino acquisition of social casino studios has been aggressive but Indian Country casinos have been hesitant to offer casino games outside of their brick-and-mortar locations because the “casino is all they have.”
In an interview with Gamesauce at G2E, Oklahoma Indian Gaming Association Executive Director Sheila Morago stated they wouldn’t call tribal casinos hesitant, but that it does take tribal governments awhile to develop strategies, noting that long-term issues, return on investment, bandwidth / hardware considerations and regulations need to be considered before pursuing a mobile strategy.
One major tribal casino, Foxwoods, has already implemented a mobile strategy that includes social casino with positive results. In G2E panel Evaluating, Building and Operating a Social Casino, representatives from Foxwoods and their partner Greentube said that they viewed social casino games as a marketing platform that allowed them to engage guests with their brand even when they were away from the casino via their rewards program, promotions and more.
They noted that fears of cannibalization were unfounded and that 80% of social casino players had been to one of their casinos in the last 12 months. They also discovered that players who were whales on the casino floor were not whales on their social casino app and whales on the social casino app were not whales on their casino floor.
MOBILE OVER INTERNET
BlueBat Games (part of Greentube) CEO Kenny Huang, Foxwoods Resort Casino Vice President of Gaming & Revenue Enhancement and Foxwoods Interactive Director of Administration Frank Pracukowski all noted the importance of mobile over internet.
Eric explained that once they implemented a true mobile solution instead of simply an online solution, they saw a giant spike in their mobile engagement. While they previously had 90% of their traffic coming from web, Kenny noted that with the mobile solution they started seeing a 50/50 web-mobile split on installs.
In a one-on-one interview with Gamesauce, Frank expanded on the importance of mobile noting that email has become a major source of junk mail. Being able to offer promotions to users while they are engaged with your app makes them far more likely to accept promotions – whereas it would be largely overlooked in their email.
Additionally, Frank noted that when they switched to a true mobile solution they began to see an uptick in revenue during summer because people always have their phones with them. Previously, with their web-based offering, they would see a decline in revenues during summer because people tend to leave their laptops at home when they go on summer vacation.
Real Money Gambling
On the other side of mobile is RMG gaming. While social casino games use virtual currency and have no real-money gambling, betting or wagering, RMG gaming is everything you can get in an actual casino or sports-betting arena on a digital platform. While largely restricted and non-existent in the United States, real money gaming is alive and well in Europe.
David Chang, the founder and CEO of Betcade, an RMG gaming app store noted that, in Europe, over half of new online gambling users come from mobile devices and that the majority of wagers are happening on mobile devices today. The same trends that have been playing out in mobile games are also playing out in mobile RMG gaming – namely greater engagement and longer lifecycles coupled with more frequent use and higher repetition but less time spent per transaction.
Similar to what Foxwoods discovered, David says the gambling industry is figuring out that you can’t simply port your online offering onto a mobile device – you need a true mobile solution that is customized for mobile users.
Additionally, David notes that demographics are forcing people in the industry to re-examine old assumptions. The traditional mindset has been that younger players don’t gamble; but, David says, it turns out when you cater to them they have one of the highest propensities to gamble.
In a panel on mobile sports betting at G2E, IGT Senior Vice-President of Global Product Marketing Betting Ludovico Calvi echoed these sentiments. Ludovico noted that people want more services and mobile is the perfect means of delivering them.
When it comes to sports betting, allowing people to watch the sporting event and bet at the same time (in-play betting) is incredibly important. William Hill US Director of Business Development Dan Shapiro agreed, saying that in-play betting is 20% of the company’s business and lends itself perfectly to the mobile experience.
OPPORTUNITIES FOR DEVS
David believes that there are ample opportunities for traditional game developers in the casino industry and says that Betcade has been approached repeatedly by those looking to get into mobile RMG gaming. On the social casino side, he cautions that the space has likely peaked and unless you are already hitting millions of downloads it may not be worth it to go into social casino gaming.
For independent social casino developers that are already established in the space though, Frank and Sheila believe there is room for partnerships – especially with smaller tribal casinos. “One tribe may not be able to do a billion-dollar acquisition, but could work with a small developer to get what they need,” Sheila says.
MAKING YOURSELF KNOWN
But how can developers make the leap? When it comes to RMG gaming, Betcade is actually setting up a program to refer those in the games industry to partners in the casino industry who can help them get their products to market quickly. David notes that the casino industry is starting to understand they need help with content and are looking for people who understand mobile and non-casino game development.
For developers interested in offering social casino products, Sheila recommends making sure a developer knows the laws for whatever state the casinos they are eyeing are in, saying that attempting to sell something that can’t get done is a waste of everyone’s time. They also recommend learning about the tribe and seeing whether they have the bandwidth and ability to get their games online without serious costs. Finally, Sheila suggests looking at what the casino has on their floor; noting that learning all the details and building relationships will carry things a long way.
Frank echoes the sentiment, saying that developers need to study a casino’s business and physical locations before claiming they can offer a solution for the casino. Mobile RMG, for instance, can be a great additional revenue generator for casinos with pools, sports bars, and at-capacity casino floors; but if a casino is smaller without much non-gaming space, it might not be worthwhile. For casinos that have concerns about offering a mobile social casino product – such as worries about cannibalization – Frank suggests pointing to the success Foxwoods has seen with their own app.
To get in touch with casino operators or manufacturers, Frank suggests attending events such as GiGse and networking with attendees. Additionally, developers can reach out to a casino’s business development division and tell them “this is what we do, why don’t you sit down and view our product and see if we can build a partnership.”