Industry Veteran Rosenberg Offers Glimpse Into The Future Of Gaming During BITAC Q&A
The one constant within the casino segment in recent years has been change, particularly in the light of a global pandemic, in addition to rapidly evolving technology. Gaming and investment expert Adam Rosenberg offered a glimpse into the future of the segment during a Q&A session at BITAC Casino Resorts Live 2021.
Taking place at The Mirage in Las Vegas, Rosenberg—who is a senior advisor for Blackstone’s Tactical Opportunities business, as well as a special advisor to GameCo., LLC—was interviewed by Larry Birnbaum, principal of XENIOS, in a keynote session entitled “Game On: You Can’t Stop What’s Coming.” The following represents a portion of that conversation.
Birnbaum: What are some of the positive trends that have been accelerated as a result of the pandemic?
Rosenberg: One of the really robust things that we saw during COVID was explosive growth in online betting. Nothing was happening in the real world for a long time. People were locked down, but the human need to engage with chance and outcomes that are uncertain is something that always endures and so people found different ways to do it. They were betting on ping pong and they were betting on sports that never really had a following before. I also would encourage you [attendees] to think about how does that relate to your business as you think about what’s changing in the industry.
COVID will never be gone, we’re going to live with it, but things are going to change in ways that make us adapt to it. So does that mean that you have to rethink your offering to your customers to make it more relevant in a post-COVID world? Do you need to make it more remote, to make it more digital, to make it cashless, to make it touchless? Some of these things will be fleeting and will pass, but some of them will endure and those in the vendor community who can figure that out are going to really do well.
Birnbaum: How do you see loyalty programs evolving within the gaming sector?
Rosenberg: You need to create loyalty in a way that is responsible in spending to keep that customer, grow that customer and have that customer bring more business to your platform. I put it in the context of cost of acquiring a customer [CAC] and the lifetime value [LTV] of that customer. Where my mind goes is different ways to engage with the customers. So loyalty isn’t just about random bonusing, but knowing the customer and knowing what they like to do and what their behaviors are. The suppliers for the industry have become really, really excellent at identifying who’s playing; knowing what their preferences are; what restaurants they eat in; what their drink choices are; where they are staying; and how often do they visit? That data exists, but it’s really difficult to suss through and use in a way that is profitable and that I think is an area where this industry could do a lot better.
Birnbaum: Do you see betting on Esports and non-traditional sports taking hold in the near future?
Rosenberg: The answer is yes and it’s already happening. There are by some estimations 500 million people around the world who consider themselves dedicated Esports enthusiasts. These are people who play games, watch games and go to events and there are a handful of companies that are organizing themselves around creating the ability to bet on those interactions in some capacity.
The Esports betting market itself is estimated to outpace NFL and NBA betting in two years, which is hard to imagine, but there is a great deal of Esports betting happening right now. It’s just happening in the grey markets and bringing that into the legal and regulated space, as is happening with sports betting, I think is a tremendous opportunity.
Birnbaum: What do you see as some of the permanent trends that will emerge post-COVID?
Rosenberg: I think the secular trends that will endure will be more remote consumption of all things gaming. We’re moving more and more toward a world of experiences, not things. That’s true for gaming as it is with every other industry. Gaming is woefully behind and awful at innovating and some of that has to do with the regulatory challenges of innovating across each state’s own regime but some of it has to do with the technical integration of gambling experiences. The industry has gotten better at that, but it needs to get much better in my opinion.
In addition, the whole migration from physical paper money to cashless is something that is only just beginning in the gaming industry and that’s a tremendous opportunity in my view. I think we’re going to see that proliferate for sure across the industry.