arcade style real money gaming: gold rush or money pit? | darion lowenstein

ARCADE STYLE REAL MONEY GAMING: GOLD RUSH OR MONEY PIT?

My adventure into real money gamingBy Darion Lowenstein

Chief Marketing Officer - Gamblit Gaming

Why this dude?• Currently Chief Marketing Officer at

Gamblit Gaming, Publisher of casual and arcade style real money games for mobile & land based casinos

• Supernerd, graduated high school at 14 (#foreveralone)

• 20 years in the game industry (scars to prove it)

• Internal & External Producer/Director at Rockstar Games, Scopely, Electronic Arts, and Activision

• 10 #1 mobile games, 14 top 5 console games including Tribes, Army Men, Red Dead Revolver, Midnight Club, Table Tennis, Transformers: War for Cybertron, and on mobile Simpsons Tapped Out, NBA Jam, & Mini Golf Match Up

• Zero degrees from Kevin Bacon

“SHAME!”

I expected the world of casual meets Real Money Gaming to be…

Instead…..

First, the mobile real money market today….

In the USA, mobile Real Money Gaming, or RMG, is legal in Nevada, New Jersey, Delaware….

In the United Kingdom….

The UK Real Money Mobile market as of 2015

UK Gambling market total (land based included) (for 2015)• 16,396,644 gamblers• £11 Billion of revenue

Mobile Online: • Casino is £1BN, Sports betting is £1.182 Billion, ‘Other’ is £259M• 7,651,767 active RMG online in 2015• 60% Male, 40% Female• 18-34: 40%, 35-54: 32%, 55+: 29%

• Apple: 45% of mobile• Android: 44%• 11% Other (Blackberry&Windows&LOL)

VS Mobile freemium market • £548 million• 20 million mobile freemium players

=Mobile Online gambling revenue 4X of mobile gaming

SOURCE: UK Gambling Commission

UK Real Money Games Launched in on iOS 2015:

Seven unique games over 8 months in 2015…All casual gamblified games

Expectation: We can use our freemium experience & analytics knowledge in Real Money Gaming (RMG)

Reality:

Mobile Casual VS Real Money

Biggest differences:- Conversion from ‘free’ trial user to RMG money deposit harder to find- Frequency & retention metrics - RMG users do not play 5X a day- Average LTV casual VS RMG - as high as 100X difference

Difficulties:• User Acquisition in a crowded market

• Average CPI around $5 targeting RMG• Legal restrictions with advertising• Limited ad networks

• Installs in casual ad channels sometimes = players who do not want RMG• Difficulties and legal requirements of signup process• No app store featuring :(

Trailblazing with casual games in RMG

Difficulties:• Google Play doesn’t <3 you….

• This equals losing nearly half the market• Competitors are multi-million dollar projects• Many casual users downloaded, didn’t want an RMG experience, left• So being a casual style game in RMG means we felt like….

Trailblazing with casual games in RMG

• Higher percentage of whales• Higher £ amount of deposits and ‘coin in’

• = More money from less customers • Little - no competition in casual RMG• Entry bar is VERY high - companies must be regulated/licensed and investigated• Social targeting at RMG users provided best results despite higher CPI• Incentivized installs do NOT work• Bonus matching deposits resulted in 3X more signups• RMG users were 3.5X more engaged then VC users

What worked wellWith each launch we got stronger…

Summary of lessons learned• Trailblazing takes time

• And $$$$$• Your (freemium) rules do not apply here• Established RMG players may not be looking for a new experience, the trick is…• In a world of Apple & Google Pay, no one wants extra legwork• Tutorials are harddddddd• Market is HUGE if you can tap into it = 4X mobile freemium!• Being early to market • Massive market growth - from £1,134Bn to £2,498bn from Apr 2014 - March 2015• Users participating in online RMG growing at 10% year over year VS Land Based

And one game launched in Q1/Q2 2016:• Quick to learn, long to master• Best engagement of any title• Best conversion to Real Money Depositor• Best retention of any titleLessons Learned:• Server side iteration without resubmission key for things like Min/Max bet amounts,

RTP, Bonus Match amounts• FTUX worked best of all games, 80% of users made through at least one full game• Average of 25 wagers per user• First time RMG deposit rate just under 10%• 25% Male 25-34, 25% Female 25-34, highest depositor with 15 unique deposits was

female 35-44• Average user gambled 12 unique days• Unique mix of casual game & gambling resonated well

Next steps• Doubling down - Fewer, but bigger, bolder launches• New methods of UA• Huge market potential & untapped customers• Licenses & known partner games

Globally, land based casinos are a $159 Billion business (VS Mobile Games: $22 billion)• The US casino market alone is $65 Billion.• Nevada alone sees 42 million visitors to casinos per year.• Slots players are aging out, and they aren’t getting replaced• Slot machine revenue is down 12.5% from 2007-2015• The first slot machine was invented in 1887 - What’s changed

since?

What’s the next big thing?

The Vegas age crisis

• Of 21-35 year olds in the USA, 35% visit casinos. However, the wagering rate of that group is only 2%.

• Barcades with classic arcade games are popular with 21-45 year olds• Arcade chains like Dave & Busters that combine games & booze are growing• UA? What now? The audience is already there• Operators are eager for new, social, interactive games – and slots makers are O_o

In a perfect world….

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Q&A

FIN

Questions? darion.lowenstein@gamblitgaming.com

Not kidding about 0 degrees!(With apologies to Kevin Bacon)