Spectrum SIGHT White Paper Spectrum SIGHT White Paper June 2017 final | Page 12

Although this time period is too short to evaluate any meaningful financial impact on land-
based SugarHouse property, we have seen that on average SugarHouse online players are eight
years younger than those players visiting the SugarHouse land-based property. So as the brick-
and-mortar industry seeks to acquire younger players, online gaming represents a proven and
effective player acquisition tool for new players.
Next, I’d like to address the small percentage of the land-based players who do sign up for
online accounts, what impact it is on them. As we know, the only way to grow revenues for a
business is to either find new players or grow existing revenues from existing players. As I
previously mentioned, online gaming does attract the new players, but now I’d like to shift the
focus on how online gaming helps to grow revenues from existing players.
Again, looking at New Jersey as a model, Internet casinos have had a materially positive impact
on revenues generated from the existing brick-and-mortar casino players. Specifically, Golden
Nugget has found that online casino players increased their average monthly spend at the
Golden Nugget brick-and-mortar casino by 15 percent after they opened an online account. So
when an existing land- based player opens an account with the online account, they
subsequently spend 15 percent more at the same property than they did before.
This is a big deal because, again, it validates that when online gaming becomes available as an
option in the market, the existing land-based players are still increasing their entertainment
spend at the land- based properties. And the fourth point that I’d like to address is the multiple
channels of having an ability to engage players online and through land-based work well
together in parallel to complement each other. Players who are cross-sold from an online casino
to a brick-and-mortar casino or vice versa going from a brick-and-mortar casino to an online
casino, they spent 33 percent more with the Golden Nugget in aggregate after they started
playing at both online and brick-and-mortar properties.
This demonstrates that when players can access and play casino games through online and
brick-and-mortar, both of them through both channels, they will increase their entertainment
spend overall by 33 percent with that brand. So ultimately, having multiple channels, online and
offline working together, will increase revenues generated from that brand and increase tax
revenues for the Commonwealth.
In closing, there are few other marketing programs in the industry that share the same capacity
to generate both new players and grow the spend of existing players in such a fashion that will
materially improve the performance of the brick-and-mortar casinos in Pennsylvania. Brick-and-
mortar casinos and online gaming increasingly offer different and complementary services and
experiences. As the casino industry has matured in Pennsylvania, it has become more than just
the gaming experience. With expanded dining and entertainment options at many casinos,
including SugarHouse and Rivers, as a result of this and other compelling data points, we believe
that online gaming represents an exciting opportunity to again increase the health of the brick-
and-mortar casino industry in the State of Pennsylvania, while at the same time generating
licensing and tax revenue for the Commonwealth. 13
13
Pennsylvania House Gaming Oversight Committee Public Hearing joint with the Senate Community, Economic &
Recreational, Development Committee, March 7, 2017, p. 133.
http://www.legis.state.pa.us/WU01/LI/TR/Transcripts/2017_0032T.pdf
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