hich is your balance of GameCo participation in G2E 2017 edition?
This was the first year that GameCo exhibited at the Global Gaming Expo (G2E) and the show was a massive success for the company. While video game gambling represents a small portion of the industry and the show as a whole, it seems to represent the bulk of the excitement. The three main themes at G2E 2017 were sports betting, esports, and skill-based games. Interestingly, all of these themes overlap in that each speaks to the concept of “player agency” - that the casino gamer has some agency and impact on their play and results. Our booth was titled “The Casino of the Future, Now!” and was designed to immerse visitors in an environment that showed the optimal placement for our Video Game Gambling Machines (VGMs).At the booth, we displayed two VGM Carousels, each with four VGMs, as well as two of our new Bartop VGMs. Our highlighted games included “Steve Aoki’s Neon Dream” and “Terminator 2” along with other new game titles. The Bartop VGM is a multigame format that featured five casual and sports games.Booth visitors loved the Bartop VGM. While the form factor is a staple in the casino environment, the newness of our content juxtaposed onto the familiar hardware was a real high point for a number of patrons. We also exhibited a prototype of our Multiplayer Challenge Mode, which provides a multiplayer feature for our single player games. Challenge Mode was shown with “Nothin’ but Net” - a basketball game in which two players go head-to-head, each with 12 shots on basket. The player with the most points wins and a tie leads to a showdown. This multiplayer feature was very popular and we’re now prioritizing getting the feature to market with a target of early 2018 for release on multiple games.Personally, I contributed to four panels at the conference, which provided additional marketing reach and raised the profile of GameCo - the key takeaway is that skill-based games in general and GameCo in particular are now part of the industry and will continue to scale and succeed.
How can you summarize this year for GameCo?
This year has been watershed for GameCo in establishing our relevancy and position as a stakeholder in the casino industry, primarily in bringing innovation to the gaming floor that attracts “net new” casino gamers and generates critical incremental revenue. As we come to the end of 2017, GameCo has launched seven VGM game titles with another one or two likely before the end of year. This includes meaningful brand partnerships such as with Steve Aoki and Terminator
Beginning as the first skill-based gaming company with deployments in one jurisdiction, we will end the year with VGMs live in almost ten jurisdictions. We’ve launched our second hardware product with our Bartop VGM - and we’re seeing extremely strong demand for this form factor. Most importantly, is how much we’ve learned from being the market leader in video game gambling. The feedback from casinos operators and gamers has allowed GameCo to continue to iterate and improve our games.
Which are the main areas where the company can grow and evolve in the future?
In early 2018, GameCo will release our first “Gen 3” games that include a range of enhancements and new features. The most important innovation will be an increase in the velocity of betting that will equal and possibly even exceed most slot machines. This will address one of the few remaining criticisms of skill-based games - that we’re not delivering the same number of “handle pulls” as traditional slots. We believe this will be one of the key aspects in creating video game gambling titles that provide Win Per Unit Per Day (WPUPD) similar to slot machines. We can’t expect the first iterations of these games to deliver “day one” but we know we’re on the right track and will continue to leverage our agile approach to development and rapidly test and learn to drive R&D in this new area. We’re also working on continue to expand the GameCo VGM Platform with new features that can be utilized by our worldwide developer network. GameCo’s VGM is ultimately a platform, similar to Xbox or the App Store, on which our developer partners create games. We’re extremely excited about our Multiplayer Challenge Mode, which will launch in 2018. This platform features enables our single player Class III games to be played in a head-to-head multiplayer format, similar to table games. This brings a competitive experience to the casino floor while also ensuring that every game can still be experienced by one player as well. Finally, one of the areas with the greatest impact and potential is marketing and acquisition of “net new” casino gamers - patrons that would not typically gamble but are now attracted by video games on the casino floor. We recently completed a research project with a well-respected analyst to understand the potential lifetime value (LTV) of a typical video game enthusiast for the casino. The average gamer is 35 years and based on current economics, the lifetime value of such a new customer is $35,000 or more in gaming revenue over 40 years. This provides a massive incentive for manufacturers and operators to collaborate on marketing and acquisition programs. Beyond gaming spend, these same customers will likely generate another $36,000 or more in non-gaming revenue - at nightclubs, bars, and restaurants. GameCo is actively collaborating with marketing and acquisition companies to develop, deploy, and track programs that bring new customers into casino loyalty programs.
Do you think that casinos are prepared to accept this paradigm change lead by the new skill-based games?
Yes - we believe strongly that casinos are prepared to accept this paradigm change lead by the new skill-based games, such as GameCo. When we began working on the concept for video game gambling, operators would often say it would take a decade for these games to even reach the gaming floor. GameCo achieved this milestone in only one year from initiating development of our VGM - so innovation is happening at a pace beyond initial expectations. One of the most important next steps will be casinos designing and opening dedicated areas of the floor for gamers and a more tech-savvy and younger audience. This won’t only be skill-based games but rather a themed area that combines the best of traditional casino products, such as electronic table games, card games, and branded slot machines, with other new products in a seamless experience that also includes non-gaming amenities. There’s no reason to wait to design the “casino of the future” as the opportunity exists today. This will be one of the key factors, along with continued improvement in skill-based games, to cement this market segment in our industry. Every new incremental dollar provides immediate benefits to casinos and allows operators to make a smooth transition from existing customers to a wider range of gaming patrons.
What kind of customers should the casino focus on from now on? Millennials in general or Gamers?
Casinos absolutely must continue to focus on their current customers - generally 55 years old or above and with a history of spending on the casino floor. However, there is an absolute need to spend resources on the next generation of casino patrons. While this includes Millennials, it is certainly a wider audience. More than 65% of U.S. households own a gaming device (PC or console) and spend 3 or more hours per week. That’s a huge audience that also includes GenX and Baby Boomers, many of whom may visit casinos for non-gaming amenities but are not traditional gamblers. Bringing this audience to the gaming floor presents a very valuable opportunity for the industry to keep their current customer base while expanding their audience now and for the future. One thing you can say about all gamers is that they love video games. So by bringing video game gambling to the casino, you provide a product that appeals to this diverse and powerful consumer market.