Millennials remain a highly coveted target for casino operations both online and offline, yet the industry has struggled to win the dollars of a demographic that rejects ubiquitous slot machines and gravitates more towards games of skill and games with stronger social elements. That is not to say that there is no demand there; millennials continue to visit gaming destinations like Las Vegas in droves; primarily allocating their disposable income across other entertainment experiences from restaurants, to shows, and night clubs. There is, however, another universe of millennial consumers who exist outside the realm of Las Vegas style conspicuous consumption: their world of entertain revolves around console gaming. Casino Industry, meet the world of eSports.
ESports (Electronic Sports), can be defined as a form sports where the primary area of play is a digital platform as opposed to grass or turf... in short, single or multi-player video game competition. Three of the biggest titles in the genre of eSports are League of Legends, Defence of the Ancients 2 and Counter Strike Global Offensive. According to an ESPN look at a NewZoo study; 205 million people played or watched eSports in 2014. There are over 28 million eSports fans and the number is growing by 21% per annum. On top of this, viewership per annum is measured in the billions of hours- in 2014 the eSports audience watched 3.7bn hours of coverage- and has experienced both rapid and steady growth over the last four years, primarily on live streaming platforms such as Twitch.tv, purchased in 2014 for just under $1bn by Amazon. To measure it up against the rest of the internet, Twitch accounts for more internet traffic than every other source except for Good, Netflix and Apple. The recent League of Legends World Championship Final was watched by 36 million people, with a peak concurrent viewership of 14 million. To put this in perspective, these numbers beat out major American sporting events such as; the NBA finals, the World Series, the Masters and the Stanley Cup finals. Crowds also attend sold-out live events in major venues such as the Staples Centre, Madison Square Garden and Korea’s Sangam Stadium, better known as the Seoul World Cup Stadium.
Before going any further it is also important to debunk some preconceptions that might exist surrounding a demographic that is heavily interested and invested in what amount to professional computer games. According to the article referenced above, more than half of American eSports fans are employed full time, 44% are parents and around 40% are women. Also, just 28% are over 35. In short, this next generation is a desirable demographic; young, professional and full of passion with spending money to back it up.
The most popular game in the eSports world- League of Legends with around 30 million daily players- brings in over a billion dollars a year for its developer Riot Games, solely through the use of micro transactions via in-game purchasing. Many of the purchases are purely cosmetic with no in-game benefit, such as different colour schemes or patterns for characters in-game. Outside of the game, markets have been created for betting on Esports through sites like AlphaDraft. Furthermore, eSports betting now exists across major regulated tradition sports online betting platforms on sites like Ladbrokes, William Hill, Skybet and Paddy Power. So where does the world of gaming coincide with eSports? The global betting market for eSports and Fantasy sites is estimated to rise to around $80million this year, a small fraction of a market sized at $750 million dollars by Superdata. Furthermore, Eilers estimates that total wagering could exceed $20 billion over the next five years. This goes to show that just because this demographic is not currently spending their money on just traditional casino style gambling, there is a much larger slice of the market to be targeted by the gambling industry. And more importantly, as shown above, this is a demographic with a large amount of disposable income. They question for the industry is can the demographic be addressed by bringing new content to the casino floor, or does the casino need to be reimagined to accommodate this massive category of gamers?
A second emerging category which the traditional space is paying attention to is Daily Fantasy Sports. Our team is well aware of the current regulatory and legal hurdles of engaging in daily fantasy, and we aren’t aiming here to address the “how-to” question in relation to participation in DFS, more the “what” lens in the sense of alternative engagement options to pure casino content for gamblers in the space. This industry has experienced huge rise over a relatively small period of time, and is very popular among millennials. This again speaks to the kind of experiences that speak to this demographic; Daily Fantasy Sports are quick paced, interactive, social and comprise a degree of skill, all facets that the younger generation is drawn too. Just as important is the accessibility. The ability to play quickly and immediately with mobile is an attractive proposition to millennials. Social casinos need to do a better job ensuring that they’re providing a well built and interactive app for their online product, if they want any opportunity to woo a group of people that turns its back on traditional games and methods of gambling.
Not to be forgotten in the discussion of millennials and new formats for gaming engagement is Virtual Reality. As the industry looks forward to new game types, they can also look forward to world-changing technological advances in gaming device form-factors. VR looks set to take off in a big way in 2016. Pre-orders for Oculus Ready PCs and Rift bundles started on February 16th, with a limited time offer of $1499 for the market-leading headset and PC with processing capabilities to support. Major tech companies are seeing the potential benefit of Virtual Reality as an industry, and are busy developing products. The Wall Street Journal is reporting that Google is developing an all-in-one standalone virtual reality headset that doesn’t rely on a smartphone, computer or console. PlayStation’s virtual reality headset, the PlayStation VR, is set to launch later this year. Other companies investing in VR or developing their own VR products include; Apple, Samsung, Eon, Microsoft.
In addition, GAN has recently got involved in VR by developing our own VR product, placing us at the head of the industry. In March of 2016, GAN launched a Virtual Reality Simulated Gaming™ application for our first continuing US client, Empire City Casino in Yonkers, New York. The product is compatible with Oculus Rift virtual reality headsets. Patrons who play online with Empire City Casino can now experience the Empire City VR casino, bringing our Simulated Gaming™ product to life. Both slots and table games are available for play through our product. GAN will continue to roll out VR features throughout 2016, and we plan to supply the Simulated Gaming™ VR experience to players of real money Regulated Gaming in H2 2016, subject to third party commercial consents and regulatory consent.
Click here to read more about the launch of GAN’s B2B Virtual Reality Casino Application.
In summary, the millennial demographic is one with great potential upside for the casino industry, yet one that has not adequately been engaged and targeted. Technological advances combined with a shift towards a more interactive style of gaming are re-defining the casino landscape as we know it today, and those who innovate quickest will stand the best chance of winning over the loyalty, and dollars of the next gaming and gambling generation.
London | August 6, 2020: GAN Limited (the “Company” or “GAN”) (NASDAQ: GAN), a leading business-to-business supplier of internet gambling software-as-a-service solutions to the U.S. land-based casino industry, today announced that management is scheduled to participate in the following upcoming investor conferences.Read Full Article
London | August 5, 2020: GAN Limited (the “Company” or “GAN”) (NASDAQ: GAN), a leading business-to-business supplier of internet gambling software-as-a-service solutions to the U.S. land-based casino industry, today announced that it will release financial results for the second quarter and six months ended June 30, 2020, after market close on Thursday, August 20, 2020. The Company will host a conference call to discuss these financial results at 4:30 PM ET that same day.Read Full Article
London | August 3, 2020: GAN Limited (the “Company” or “GAN”) (NASDAQ: GAN), a leading business-to-business supplier of internet gambling software-as-a-service solutions primarily to the U.S. land-based casino industry, today announced the appointment of Marcus Yoder as Senior Vice President of Sales, reporting to Chief Commercial Officer Jeff Berman. His primary responsibilities include sales, services and B2B marketing.Read Full Article