What does the new generation of 'virtual gamblers' mean for the industry?
It seems safe to assume that the future of gambling will look very different, as a new generation of players enters the fray with an online-first outlook. Arguably we're seeing the first generation of gamblers who will entirely miss the ‘brick and mortar’ experience.
Generation Z – those born between 1997 and 2012 – come with different expectations, preferences and approaches. With it, casinos, and the broader industry, have a whole new set of considerations to factor in, as they shift and adapt to changing player behaviour and thinking.
More mature betting enthusiasts, who are familiar with high-street bookies and casinos, might see the online experience as an enhancement to a world they already understand. But for many Gen Zedders, going online is their default setting and this is starting to hit in-person revenues in some areas.
How can slot sites and other gambling operators meet the expectations of this emerging cohort and how might it affect the industry as a whole?
Online-first approach
Younger people tend to adopt an online-first approach to most things. From basic concepts, such as communication, to purchasing holidays and booking taxis, they share a significantly more digitally-oriented outlook than older people.
In the gambling sphere, these are customers who never have, and likely never will, engage in gambling in the same way as their parents and grandparents. The idea of seeking out a physical location to play classic casino games or slots seems archaic to them. Fixed Odds Betting Terminals have bridged the gap to some extent, but the number of people seeking a more flexible gambling experience online has never been greater.
Revenues are rising across the online gambling sector, mainly due to online slots, and for the most part, this shows no sign of abating. New regulations may prove to be considerably more restrictive, but for now, there’s no shortage of participation among younger demographics.
Continual growth or has the industry peaked?
Does this mean, with the ease and convenience of online betting, that revenues are set to perpetually rise? Will we see year-on-year increases in revenue, as a greater proportion of gamblers reach legal age with this online-first mindset? It’s certainly possible for the foreseeable future, pending the impact of regulation, that this could play out as envisaged.
Beyond the convenience of online tech, some argue that the industry will continue to see increased profits because the wins and losses feel less ‘real’ when they happen virtually. There is certainly evidence to suggest that young people gamble at proportionately higher levels than previous generations. 18 to 24-year-olds make up just a tenth of the gambling population in the UK but they form nearly a third of those who stake £500 or more each month.
However, I would argue that this generation has grown up largely cashless and digital spending is the norm. Why would they suddenly compartmentalise online gambling credit and subconsciously perceive it as unreal?
Whatever the rationale, gambling operators now more than ever need to invest in customer acquisition, retention and the quality of their offering. Online slot sites and sportsbooks are the casinos and betting shops of tomorrow. Few would disagree that this is where the growth will be for the industry in the years ahead – both at home and in overseas markets.
Will Gen Z ultimately seal the high street’s fate?
While revenues could well continue to rise in the online sphere, it remains unclear whether there is a longer-term future for brick and mortar sites such as the high street betting shop or bingo hall.
Will people still walk into a shop to place a bet in 30 years, when they can achieve a similar (or arguably better) experience on their phone? Unfortunately, I think the high-street bookies’ days are numbered. Or perhaps, like vinyl records and moustaches, they'll land on the hipster radar and enjoy a revival.
It’s uncertain whether those not predisposed to gambling amongst younger generations will ever be tempted into the market, or whether these delineations remain fixed for years and decades to come.
But, in reality, these are today's challenges, not tomorrow's. Gambling operators are already battling with the tests thrown up by a generation of customers with entirely different expectations and preferences from their predecessors.
To survive and ultimately thrive in the new world, operators will have to be very much focused on satisfying this demanding group. They’ll need to recognise the preferences for convenience, flexibility and transparency among gamblers who have never had the pleasure of physical gambling experiences.