A Mobile Market Opportunity
Today’s blog was inspired by some interesting facts that I have researched and interpreted for readers working in the casino industry. This information is relevant to any business that may want to use technology to more effectively engage with its clients and/or employees. There are many potential applications. If you want explore this information, please follow the links to the source material. I am also producing an article on this topic for the next issue of Canadian Gaming Business Magazine.
Writing a 1,500-word blog is risky in today’s world where people like their content to be short, visual and snappy. This information is, in my opinion, so important that it merits the detailed treatment we are offering today. One final bit of housekeeping: in this blog, we often use the term “game” or “gaming” to refer to casino games, which – typically – include a wager of some type and an element of chance. However, today, the term “gamer” is referring to people who play electronic games on a designated console (Nintendo, xBox, Playstation etc.), on their smart phone or tablet, or using their personal computer.
If I asked five people to describe a gamer – meaning someone who plays electronic games, often called video games on a phone or tablet, on a computer, or on a console system of some type – I would be willing to bet that I would receive fairly similar responses:
Young – under 25, maybe under 18
Interpreting these assumptions with more colour, I suspect I would learn that a gamer is a socially awkward young man who lives in his parents’ basement. This stereotype is not supported by the facts.
Who is a gamer?
The average age of a “gamer” is 31. There are more gamers over the age of 36 than there are gamers between 18 and 35, or under 18.
52% of gamers are men and 48% are women. (This is not a typo!)
The average man who plays electronic games is 35 and the average woman is 44.
Gaming is Social
According to the 2016 Entertainment Software Association’s annual report: “54 percent of respondents play games with other people, including friends (40 percent) and family members (21 percent).”
Gaming is a Spectator Sport
Young gamers now spend more than twice as much time watching others play games as playing games themselves.
According to Business Insider, PewDiePie, a Swedish “vLogger” (video blogger) is the most successful Youtuber in the world. He has over 39 million subscribers and over 10 billion (with a “B”) views! PewDiePie comments on the video games he is playing.
More people watched the League of Legends championship (a PC video game) than the 2015 World Series. 334 million viewers tuned into the four-week League of Legends finals period in 2015, up from 288 million viewed the previous year. On average the audience was 4.2 million strong at any given time.
Gaming is BIG, BIG Business and Mobile Gaming is growing
In 2016 mobile gaming (played on phones or tablets) has financially outperformed console and PC gaming for the first time ever:
Revenues from mobile games are anticipated to reach $37 billion – which is coincidentally 37% of the total combined revenues expected from mobile gaming, PC gaming and consoles (like Nintendo, or xBox). Yes, that’s $100 billion that will be spent on electronic gaming. For context, global casino revenues were estimated at $183 billion in 2015.
Interpreting the facts
Armed with these facts, we have to create a different picture of our gamers.
They are highly social people. Playing and watching games is a social, not isolating activity.
Gamers are men and women.
Gamers are not just youth and young adults. Women who game are older. (Outside of the Millennial demographic.)
Gamers have money to spend on entertainment and are willing to spend money on smart phone and tablet games.
In summary: everyone is a potential gamer. Gaming has been mainstreamed.
While gamers used to be a defined subgroup of society, gaming is now accessed and enjoyed by a majority in our population, it is a mainstream, not marginal behaviour.
How did this happen? My guess is that the smart phone and social media culture have a big part to play in this transformation. Furthermore, I suspect that most people, who game today, don’t think of themselves as “gamers.” This group includes the legions of addicted Candy Crush Saga fans, or people who play Scrabble on Facebook.
So why does this matter?
The gaming industry is making billions. While the casino industry has been thinking about how to win over the Millennials there is an established market that is defined by behaviour, not the year of their birth, spending billions on entertainment. Everyone can exhale now, because I know you are tired of talking about Millennials.
This group of social, connected, entertainment seekers is the future of games of chance, in whatever form they evolve for both land-based and virtual operators.
Some product manufacturers and casino entertainment companies are operating in the mobile gaming space. MGM and Caesars Entertainment come to mind, but they are still using the traditional slot experience as the launching point for their games. This is fine for established casino customers but does not have the necessary appeal to attract new casino customers.
The challenge for bricks-and-mortar casino operators continues to be experience, product and preconceptions, in my opinion. These issues are all connected.
Some people have an outdated idea of what they believe casinos are like, so they don’t want to go and play their grandmother’s slot machines. Even when casino operators are able to attract new customers to their properties, perhaps to sample entertainment or dining, actually engaging them with the casino gaming product is challenging – particularly slot machines.
Product manufacturers have been trying to evolve their games but it has been slow. A lot of the product we saw at the Global Gaming Expo (G2E) in September still looked a lot like the same old slot machines, even if they endeavoured to incorporate skill-based elements or multiplayer aspects. New manufacturers, like Gamblit, have games with a different look and approach more like arcade games, but according to a review we read after G2E written by “real millennials,” the controls were difficult to manipulate. This will be a barrier to converting experienced gamers to these casino products. The casino industry has been slow to introduce these new games, partly due to the need for regulatory approvals and partly because the industry moves slowly.
Our interpretation of the research we are sharing with you today is that there is a huge, largely untapped market consisting of highly social, connected, engaged gamers with disposable income. The challenge to bricks-and-mortar casino operators is how to enhance the casino experience to attract and engage this massive market segment, which represents a significant business opportunity and is already predisposed to enjoying games.
The advice for today:
Gamify the entire casino/resort experience. Operators that figure out how to make the visit itself an immersive game experience will have a real advantage with this vast army of consumers. To succeed with this market, you can create new opportunities for revenues within the mobile space that can be activated at your destination. Of course the entire experience – from dining, to shows, to live and electronic games of chance – needs to meet or exceed regular and infrequent/casual customers’ high standards. (Shameless plug - if you need help with this, Play the Field™can help.)
This approach requires operators to think of the business and the experience it offers holistically. We have observed that gaming operations and non-gaming amenities are often siloed. You cannot create a compelling, satisfying, immersive experience without thinking about how the elements combine.
Operators and business owners must ensure they are implementing their ideas consistently and effectively. Lots of good ideas fail in the execution.
Finally, just by using the data most casino operations collect in the course of doing their business, operators can curate the experience offered to your customers based on their individual preferences. This was discussed in “The Age of Personalization” in October. The vast majority of your customers – regardless of their age – are living with their technology. Use that technology both to attract and keep pace with your customers more effectively.