“ You ’ re going to see alignments and mergers as inevitable because customer experience and speed to market will become key success factors . You can see it in the larger ecosystems today , and with new regulations , technologies , and better understanding , ( consolidation ) will continue .”
— Victor Newsom , Senior Vice President for Product Management and Payment Solutions , Everi
“ For now , several payments providers have emerged to serve the gaming industry and have been fairly successful in doing so . However , it seems likely that a few current leaders in the space will continue to grow and out-compete the rest , cementing themselves as the leaders in gaming payments .”
Victor Newsom , senior vice president for product management and payment solutions for Everi , agrees that consolidation is inevitable . But Newsom adds , “ I ’ m not so sure about the coming year . There will absolutely be pressure to merge , if for no other reason than speed . We have a lot of companies that have been very successful in a specific channel with the segments defined the way they were . I think they will be less successful trying to do more against competition in a different channel that is highly optimized there .
“ You ’ re going to see alignments and mergers as inevitable because customer experience and speed to market will become key success factors . You can see it in the larger ecosystems today , and with new regulations , technologies , and better understanding , ( consolidation ) will continue .”
Noah Acres , a principal of Acres Manufacturing , points out that for casinos to go cashless , they must partner with both a “ cashless provider ” and a “ cashless enabler ” to facilitate transactions between a digital wallet and , for example , a slot machine .
“ Cashless providers are represented by wallet providers like Everi , Sightline , Koin or FABICash , while cashless enablers include Acres ’ Foundation platform as well as legacy CMS providers ,” Acres says . “ My prediction is that on each front , the industry will consolidate on two to three primary suppliers — whether through ( mergers and acquisitions ) or attrition .”
Newsom says there is a “ fundamental shift ” coming in defining the cashless gaming sector from what he calls a “ fintech perspective .”
“ You must look at the macro pressures that are forcing a convergence of land-based , online and sports wagering along with — in terms of guest experience — retail , hospitality , and venues . So when you add all the players across those current channels , and you look at a sector defined tomorrow in a way that is converged with and without omnichannel experiences , then I think you ’ re going to see tremendous pressure in knowing who is the player or who is the payment service provider , along with how multiple providers work together ( or not ). All those different mouths to feed across those different channels of interaction will likely force some consolidation .”
For PayNearMe ’ s Leighton Webb , vice president and general manager of online sports betting and iGaming , part of the future of the sector will lie in the point that “ regional operators will continue to carve out meaningful market share in the markets where they have strategic advantage — meaning , a core database of customers .
“ Instead of trying to predict consolidation , operators should be focusing on choosing the tools and partners that will help them win now . We ’ ve seen repeatedly that those who move quickly and decisively can gain a lasting market share advantage . Evaluating new vendors that support these goals should be a priority .”
And like Newsom , Webb says that with no clear market leader at the moment , it may be too early to project rapid change in the number of brand
leaders .
“ There are plenty of other scalability , regulatory and operational issues for them to focus on , like finding an experienced payments partner that can help them scale and acquire market growth in a growing , crowded industry ,” Webb says .
Young , Old or Both ?
Younger gamblers , or “ digital natives ,” as Justice has called them , are the long-term key to any gaming company ’ s viability . But older gamblers tend to have more discretionary income , as well as longstanding loyalty to particular casino operators . So , is one consumer sector more important than the other , and are there enough resources available to focus heavily on both simultaneously ?
“ Casinos can only focus on the players they ’ re serving today ,” Acres says . “ But over 30 percent of today ’ s slot revenue is derived from players age 70 or older , and with average life expectancy being just 77 , casinos cannot count on those patrons forever . So casinos have to attract new players immediately .”
Justice notes that the main demographics for casino visitors skew older , “ that is to say , 50 years old and over .
“ Our intent is to develop solutions that appeal to that market , precisely because they tend to be less intuitively familiar with digital technology ,” says Justice . “ For patrons who prefer playing with cash , we offer solutions like our VIP Financial Center , which allows patrons to take out cash on the game room floor .
“ However , we believe that by emphasizing usability and convenience , we can cater to both old and young patrons . Regardless of age , all patrons want a fast and easy payments experience .” Webb echoes many of those sentiments . “ While the online betting masses are going to be demographically skewing toward the younger , newer bettor who is very familiar with digital payments , operators will need to continue to focus on their loyal VIPs — which may mean continuing to focus on cash . Regardless , we ’ ll continue to see progress as far as new digital payment types and emerging technologies for the younger and newer gaming audience .”
Newsom agrees that “ we ’ ve had no real choice but to provide most of our focus on the current gamblers — the generations that have discretionary income . Current systems for land-based solutions have been largely monolithic and / or purpose-built , making digital transformation hard . I think what ’ s going to happen , in the next one to three years or so , is that this pressure for cross-channel collaboration in the guest experience will force a merged ecosystem that services both simultaneously ...
“ Digital-first patrons will still expect cross-channel interactions , and will expect them to be robust . When your favorite streaming show can follow you from room to room of your house , your dog ’ s food bowl orders more from Amazon , and a whole host of smart city experiences set the bar , the industry will be expected to keep up .”
SEPTEMBER 2023 www . ggbmagazine . com 15