Attracting millennials to casinos takes more than some updated games. Studies show millennials spend their money elsewhere in the gaming industry.
Does the gaming industry face challenges attracting millennials, the generation now coming to dominate the U.S. workplace and the nation’s entertainment industry? The answer largely depends on what you mean by the gaming industry. If you’re talking about just gambling — and money spent on it — millennials represent a diminishing stream of revenues. If you widen out to consider the entire gaming experience of food and beverage, travel spending, shopping spend, spending on accommodation, nightclubs and more, things look much brighter on the millennial front.
The Millennial Entertainment Preferences Study, finalized in July of 2016 and conducted by the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton University, notes that millennials gamble at significantly lower rates than members of other generations. Indeed, only 8.5 percent of a millennial’s budget is spent on gambling, compared to 23.5 percent spent by non-millennials. That may look like bad news, but it doesn’t have to be. Why? Because millennials put more value and money on other aspects of the gaming experience, giving much higher importance to food and drink than non-millennials.
Entertainment Preferences Among Millennials
As the study explains, millennials “clearly felt that drinking activities including bars, lounges, nightclubs and happy hours were more important than did their non-millennial counterparts. With the prevalence of drinking activities, it’s not surprising that more millennials rated public transportation as important versus non-millennials.” When offered to rank a list of 28 activities they might pursue as part of a gaming experience, millennials ranked gambling as twenty-first, way down the list. While the top three preferred activities for millennials all involved food and drink.
The news on gambling might look bad, but millennials actually spend more money than non-millennials on other “gaming experience” costs such as hotel accommodations, nightclubs and transportation. In a surprise, millennials extended their stays at gaming resorts for a week or more at a much higher rate than non-millennials did, according to the study. Millennials are also more social: The study found that less than half of millennials prefer to play slots by themselves, while 70 percent of non-millennials prefer to play alone.
What it Means for the Gaming Industry
Millennials are different in the ways they spend their gaming dollars. The data shows that millennials prefer a gaming experience that extends far beyond the casino, spending their money on quality food, drinks, accommodations and nightclubs. This is neither good nor bad news for the gaming industry, but poses a challenge for the industry in designing a more holistic, less casino-centric customer experience.
Technology will play a key role, as millennials continue to use mobile apps and wearable technology to live their lives. Scott Klososky, who spoke about the digital transformation of gaming at the Global Gaming Expo (G2E) this year, says that casinos need to think more expansively, offering experiences and technology-enabled solutions that millennials have come to expect.
“Imagine walking into a casino and getting a wearable,” Klososky says, “which will allow you to do transactions and track everything you do. It will help create a better customer experience while providing lots of actionable data for casinos.” This data collection could allow gaming resorts to offer more personalized experiences, like special promotions on food and drink or discounts on extended hotel stays. Such personalization may be the future.
Millennials as Both Disrupters and Enablers
Millennials are presenting challenges to the gaming industry, forcing it to improve on non-gambling parts of the entire experience, from better nightclubs to more diverse food options. Whether millennials will disrupt or enable a casino’s growth is largely up to how it adapts to the evolving customer expectations. What’s clear is that the growing influence of millennials as a customer segment will not be going away. Attracting millennials with a customer experience beyond gambling might not be easy, but it’s crucial.