GGRAsia – Engaging millennials new trend for 2015: Spectrum Gaming

Engaging millennials new trend for 2015: Spectrum Gaming

Dec 09, 2014 Newsdesk Latest News, Trends & Tech

Spectrum Gaming Group LLC, a research and consulting firm offering a variety of services to the casino gaming industry, says the convergence of gaming will continue in 2015, with casinos, lotteries, igaming, social games, pari-mutuel and bingo “offering products that cross into the others’ traditional space”.

On Monday, Spectrum published a list of what it considers to be the 21 most important trends “that the global casino industry needs to monitor in 2015”. The firm has been compiling the annual list since 2005.

The consulting firm said more gaming operators and suppliers will acquire social gaming companies and capabilities “as they seek to engage millennials as the future generation of gamblers”.

Millennials is a term used to describe people who came to young adulthood around the year 2000. Now in their 20s and early 30s, they typically have more disposable income than did their predecessors.

Millennials are said to have a greater desire for interacting via social media, which creates a challenge for casino gaming machine content providers and casino operators keen to capture this market segment of consumers.

In its list, Spectrum said that game developers and gaming operators are now expected to “accelerate efforts to turn social games into gambling games”.

Gaming manufacturers have been showing growing interest in the thriving online social casino games market. Earlier this year, casino equipment maker Bally Technologies Inc paid US$100 million for Israel-based online social games software developer Dragonplay Ltd.

A report from Union Gaming Research LLC in October said there was an increase in interest on social gaming by land-based casinos during Global Gaming Expo (G2E) 2014 in Las Vegas.

“As anticipated, social gaming has drawn some attention and created some buzz at G2E this week,” analyst Robert Shore wrote.

According to Mr Shore’s note, the social gaming industry has evolved into a US$2 billion-plus sector with casino-style gaming as one of the fastest growing subsectors.

But Fitch Ratings Inc said in a report in July casino-themed social games posed a threat to U.S. regional casino operators.

“We believe there is meaningful overlap between casino and social game players, and spending on social games, along with lotteries and other low-cost, convenient alternatives, eats into the customers’ casino and other recreational budgets,” the rating agency said at the time.

In Monday’s report, Spectrum warned that states weighing legalisation, expansion or current performance of casinos in the U.S. “will have to deal with the impacts of market saturation within and beyond their borders”.

“The national pie will grow slowly, but many markets will continue to be flat or declining,” it said, adding that casino operators will be encouraged “to broaden their appeal and change their business models to become less gaming-centric”.

New Jersey-based Spectrum operates in Asia through Bangkok-based Spectrum Oso Asia Ltd. Spectrum Asia also has offices in Japan, Hong Kong and Guangzhou.

In the top 21 trends for 2015, the consulting firm said Asia would continue to be the focal point in global gaming. “Governments and developers armed with nine- and ten-figure cheques seek to tap the lucrative Asian market, from Vladivostok to Saipan to Cambodia,” it said.

Spectrum also said Macau would continue to be challenged in the near term due to the Chinese crackdown on corruption, and in the longer term due to increased competition in Southeast Asia.

With the expansion of the casino industry in Asia, Spectrum expects Asian junket operators – also known as VIP room promoters – “to continue diversifying to new jurisdictions and into different areas of business operation”.