With a last-minute deal that avoids the fiscal cliff, the economy seems spared from a plunge back into recession as many feared. That’s good news for industries that depend on consumer spending, such as gaming and entertainment. Year-end results for casino jurisdictions aren’t in just yet, but today’s news that box office receipts hit a record $10.8 billion in 2012 is a clear sign that people are opening their wallets for non-essential goods and services. It’s up to gaming operators to offer products and convenience worth their consideration.
For the movie industry, while the number of actual tickets sold was less than the record set a decade ago, there was a year-to-year increase that was quite impressive in the age of video on demand at home and on the go. Social media was credited with creating the need to see the biggest blockbusters in theaters rather than on small screens.
Gaming interests have similarly adopted social media in the hopes that it will help drive business. If the products and experiences are good, social media is invaluable to developing customers and brand loyalty. If there are any deficiencies in products or services, social media spreads the word. That can be a good thing if it gets operators to recognize the problems and make changes. Just look at mainstream corporate America – an unhappy consumer can get almost immediate attention by complaining on a social media site, whereas that same customer’s pleas to a company hotline or email address may go unnoticed for days or weeks.
My point is that consumers are spending again, but they are doing it with increased expectations of value and little tolerance for missteps. So now it’s up to gaming operators to capture that spending, and to meet those expectations, in a world permanently scarred by tough times. They can do it by making the product more convenient, and that’s the goal of efforts to legalize online gaming. They can do it by keeping the products fresh and interesting, and that’s always the major challenge. And they can do it by expanding into new jurisdictions.
This year, several things will happen. In the absence of federal legislation, lotteries will continue down the Internet path as states decide their own direction – Georgia and Delaware are on deck. States may decide to go beyond online lotteries – New Jersey passed an online gambling bill, but Gov. Christie has yet to sign the measure. And you can bet casino interests will try for federal legislation again.
In the bricks and mortar world, casinos will open this year in new markets in Maryland, Ohio and Pennsylvania. Bidders for Massachusetts’ casinos need to express their interest this month with Phase I applications, but it is still a long road before licenses are granted. All casinos in Maryland and one in Rhode Island will add table games. The anticipated Margaritaville Resort Casino in Louisiana will open its doors this summer. And there are other projects out there, those that address the need to keep things fresh and interesting in existing markets.
Their fate will be decided by consumers, in whose hands the power now lies. Happy New Year everyone!