Never has it been more important for operators to know their customer, cater to their needs and get them back through the door - and there's still a lot to be learned
The pay-to-play industry has in the past been at the forefront of technology, embraced it and moved forward with it, but it would now appear some operators are stuck in a bit of a rut when it comes to managing their locations and keeping up with the times. This has resulted in a lack of repeat customers and locations continuing to close all over the world.
With the industry still suffering at the hands of the recession and stiff competition from the home console sector, as well as other leisure spends, a lack of foresight and enthusiasm cannot be solely to blame for the demise of the amusement arcade, but it hasn’t done it any good either. Amusement and gaming arcades have, in the past, had negative connotations associated with them, generally thought of as dark and dingy and not somewhere you would really want to spend your time unless you’re a hard-core gamer.
However, in more recent years big chain style locations have begun to pop up, offering the consumer a much more inviting and enjoyable experience. The casino industry has been doing it for years, working hard to improve its food offering, level of customer service and atmosphere, in order to retain its customers and now, amusement operations such as Timezone in Australasia and Dave & Busters in the US have followed suit to make sure the customer’s experience is enjoyable and one they want to experience again and again.
In order to do this you need to know your customer…but really know them. Rather than second guessing what sort of games they want to play and what secondary spend items might prove popular, operators should be learning about their customers, recording the information and then responding to it.
But where to start…Well, operators can learn pretty much everything they need to know about customer retention and customer service from the retail sector. You only have to look at the quality of stores in shopping malls, the attitude of the staff and the number of loyalty and discount cards that are around to see what it takes to satisfy customers’ high expectations and keep them coming back.
“Walk into any modern high street chain or new shopping mall and have a good look around,” Embed Playsafe’s David Stenning says. “Presentation, appearance, helpful staff, branding and regular change…All these things and more. Although as an industry we don’t sell a product directly to the customer, as you would find in a shop, we are selling a service. You can go back to the Green Shield stamp days (a loyalty scheme using trading stamps in the UK and Ireland to reward shopping by being able to buy gifts) and from there on the trend was set. Forms of loyalty have emerged and now it’s everywhere and expected by the customer. One of the biggest things of course is marketing and I don’t mean a couple of glossy posters in a shop window.”
QubicaAMF’s Jelena Kuznecova also tells InterGame: “The retail industry has figured out how to grow customer profitability with loyalty and reward programmes. They use these programmes to acquire and recognise customers, they then take what they know and create customised offers to drive customers to spend. Finally they reward customers through points and discounts, which ultimately drives increased spending.
“We are seeing more and more of these types of programmes all with good intentions, but very unclear objectives,” says Kuznecova. “Many operators often mistake having a large database for a loyalty programme. The goal of a loyalty programme should be to acquire, increase spending and retain customers and for it to work, you can’t just send a generic email once a month to the entire database and expect to have customer loyalty and retention.”
For Stenning, it is time for a change in the industry and it’s time operators really stopped and looked at all aspects of their business and where they want to be in the future. “I believe that many operations have been run in the same way for so many years that change is a foreign word to them,” he says. “The fact is that there are operations doing very well and this is because they have moved on with the times and are presenting a very good overall package to the customer. A large number of our customers are now seeing the benefits of embracing a new and modern way of presenting their business to their customers.”
As far as Adrenaline Amusements’ Marc-Antoine Pinard sees it, one of the main problems in the industry is that there seems to be a trend that sees operators replicating what is already available in the market rather than standing out from the crowd. He told InterGame: “Rather than standing out from the competition they seem to enjoy doing exactly the same. Carrying exactly the same games, offering similar food and ensuring they don’t bring their own take on things. They shouldn’t be afraid to fail when trying something new…Just don’t put all you have into something. Operators are beginning to make more use of loyalty cards but they still focus heavily on payout while forgetting about the other benefit of a player’s card.”
There are operators out there, however, that have been particularly innovative when it comes to player loyalty including chains such as Dave & Buster’s, with its evolving use of Facebook and Nickel & Dimes, using tournament features. “Chain stores are starting to offer a seamless experience no matter which location you visit and this will naturally draw players back in,” says Pinard. “Operators should also look to Vegas for inspiration. They mean business when it comes to customer service and it is world famous for it; Vegas should be your benchmark.”
And in the UK, it is no secret that Embed Playsafe is currently trialling the first cashless system with Crown and Bourne Leisure. “Working with Kevin Scott, it’s clear that the genuine enthusiasm for this type of offering is there from both parties,” said Embed Playsafe’s Stenning. “It was also quickly realised by both parties that this is all about marketing and the need to embrace the entire solution. And then there is Mecca, which has shown over the last few years a genuine wish to move its offering forward with loyalty and player tracking.”
And in India, one of Semnox’s customers launched a programme, which categorises in platinum, gold and silver slabs based on spend. With each higher band there are discounts on game play, redemption ticket price and other benefits.
“Another one of our customers has been registering basic customer information right from day one,” said Kiran Karanki of Semnox. “Now they are sitting on a huge database of their customers which they intend to use for targeted customer communication. With the help of a CRM module that gives detailed analysis of customer spend and behaviour, they will be able to easily create a targeted customer subset which will drive their loyalty programme.”
For Lukas Poehacker of Cashpoint, operators need to get creative. The regular way of doing things is just not good enough any more, the offering needs to be varied and customers must get the feeling that they are in the best location possible.
Cashpoint recently introduced its member.card, a customer loyalty tool where registered customers receive a variety of benefits, ongoing bonus bets placed on actions and the opportunity to participate in attractive competitions. The member.card gives the customer the option of their bets on one card regardless of whether the customer has made the bet in the shop, betting terminal or on the internet, the benefits of the member.card can be accessed anywhere.
Operators could also learn from the retail sector’s use of social media and new ways of communicating, which allows the operator to inform and follow their players like never before. For VDW International’s Laurent Van De Wege, player loyalty starts when the player enters the arcade but continues when they have left. “The player needs to leave an FEC with a positive impression that will make them come back,” he says. “This is obtained through a lot of parameters that the operator can influence such as value for money. The internet also allows a lot of new approaches towards player loyalty to be introduced. The investment may be heavy to begin with but once the system works it can be very efficient and rewarding for both operators and players.”
Van De Wege also believes that the games themselves have a role to play in keeping the players loyal, telling InterGame: “They must be fun to play in the first instance and give the right value for money. They also need to be kept in perfect working order. The more challenges the player faces in a game, the more they are motivated. Any approach where the overall experience goes beyond the principle of a single play on a single machine is always an improvement.”
Karanki of Semnox adds to this, telling InterGame: “We think continuous communication whether through emails, SMS, or social media is something our industry needs to learn how to do and how to do well. Retail brands continuously showcase to customers what promotions and reward programmes are running that are going to benefit the customer. This not only improves the brand recall, it also give a sense that the operator is serious about the reward programme and wants their customers to take advantage of it.”
For Karanki, currently, the pay-to-play industry does not make enough use of the possibilities available with loyalty programmes and this could be because of the amount of effort that is required to keep it running for long periods of time.”
For Embed Playsafe’s Stenning, it is not a ‘switch it on’ answer to the industry’s problems. It is about a new learning curve that must be worked with and understood. It is a way of understanding a business and the customers better, it is a solution to be used. “I think it is fair to say we have had great success with some of our customers and then some that have not made the effort to maximise what it can be used for,” he says.
“There is one important area that any potential user of these types of systems should understand and that is the commitment that is needed. By this I mean someone taking proper ownership of the system, understanding its potential and using it as it was designed to be used.”
It is clearly very important that the pay-to-play industry gets into the habit of rewarding its customers if it wants to compete for that all-important leisure spend. But how does an operator ensure the right customers are being rewarded?
There are player loyalty schemes in the industry that do miss the mark because they are either open to abuse or they are working off inaccurate information and according to John Comfort, managing director of JCA Systems, if a loyalty system is not working fairly it will do more harm than good in retaining genuine customers as they will become frustrated.
JCA Systems, based in the UK, provides player tracking and loyalty systems. Its most recent product is the PlayDesk, a full player tracking and loyalty system. Attractive card modules attached to machines send information about play back to a central server, allocating MaxyPoints on a fully programmable basis dependent on the machine type. PlayDesk reports allow players’ habits and preferences to be discovered, uniquely enabling targeted promotions.
“Operators often go wrong because they are working from inaccurate information,” said Comfort. “The only failsafe way to find out how much money people are spending and where they are spending it, is to link the system to every machine in the arcade, whether it is a fruit machine, video game or pusher. That way, a true picture of player preferences starts to emerge. By understanding this, the operator can then choose suitable rewards which are set at the right level to encourage repeat play.
“We have seen kiosk systems designed to reward daily attendance and some customers have simply gone into the arcade to log on every day without actually playing any machines. With other types of loyalty systems, it can be quite hard to avoid a situation where the staff bend the rules to favour their friends.
“Operators need to see that they can get a return on their investment first and foremost. There are some loyalty systems on the market that are still very expensive and, understandably, many arcades will baulk at these kind of costs at the moment,” added Comfort. “However, a card-based loyalty system that provides a customer database, which can be used for promotions, need not be expensive. I would say that operators already know that this sort of system could be good for business but they need to know that it doesn’t have to cost the earth or take too much of their time to operate.
“Customers are getting more discerning and they know what brands they like from an early age. Online, we are increasingly targeted by promotions and greeted by name when we log onto a familiar site. While some people may find this kind of data sharing unnerving or intrusive, it has become part of daily life and the younger generation are far more comfortable with it - just think about the social networking sites.”
Another obstacle stopping the pay-to-play industry moving forward as quickly as suppliers would like is the belief by operators that all the customers will disappear if cash is removed. But as far as Stenning sees it, why would they if they are getting a better deal all round? “It is all about education,” he says, “for us as well, there is a lot to learn and this is a new journey. But the experience we have in Embed Playsafe goes beyond just selling a system; we can help with that education process, we can help with marketing and branding and we can go on the journey with our customers.”
Looking forward, for the pay-to-play operator, they are going to have to continue fighting for that consumer spend, competition is getting much stronger in all walks of life and the amusement industry is no different. Technologically, there will be the tools these operators need to ensure they are rewarding the right players for the right things, but they are going to have to change the way they see their players first and foremost.
“Operators should assume they understand their customers’ needs,” says Stenning. “They need to improve the offering and service they provide and benefit from the solutions that are available to increase revenue in their business.”
And for Karanki, operators of tomorrow should be customer-centric, use tools available to them, processes, IT systems and so on while managing their business professionally. “Operators need to understand their customers through information analysis and change their business to suit their customers’ needs. Loyalty should be seen as the end gain to retain customers rather than a stop-gap arrangement to enhance sales. Loyalty will drive revenues higher inherently.”
CASE STUDY
With over 2,500 machines connected across Romania, gaming operator MaxBet Romania is putting good use to the features of the DRGT-SiP machine network, which includes a progressive jackpot system that is simple to set up and operate; a tournament offering and loyalty bonus feature, a key function within the DRGT-SiP machine network. Also new is an automated raffle ticket solution, which allows players to print their own raffle tickets at a self-service machine, ensuring they can simply and quickly obtain their raffle tickets while providing the operator with a cost-effective solution for operators. Jurgen De Munck, CEO and co-founder of DRGT, explains: “Player loyalty is a fundamental part of the DRGT systems solution and flexibility is key. Player loyalty means different things in different countries, depending on the local jurisdiction. Our player loyalty system can be tuned directly to each individual jurisdiction. We empower our customers. This in particular benefits operators who are active in several countries. Our software has been written to be extremely customer friendly.” Sorin Georgescu, general manager at MaxBet Romania, adds: “We are looking for a very diverse and flexible player loyalty scheme. SiP now with DRGT, is in a position to provide MaxBet Romania with this. They listen to and understand our needs.”
