BUSINESS

Why iGaming sector must change its mentality and adapt to millennials

TAGs: daily fantasy sports, iGaming, Oulala, Valery Bollier

This is a guest contribution by Valéry Bollier is the co-founder and CEO of Oulala. If you would like to submit a contribution please contact Bill Beatty for submission details. Thank you.

Will the sector follow the Kodak or the Fuji example?

Do you remember the years 97-98, when digital technology arrived in the camera industry?

Kodak was an impressive market leader. The first digital camera produced from their lab emerged in 1975 but they claimed that the digital aspect would only remain a niche market. In reality, they were simply not ready for the radical change that was necessary: structure, team, technology; everything needed in order to be reinvented!

In 2004 they realized their critical mistake and tried to position themselves on the digicam market, but by then it was far too late and in 2012 Kodak went bankrupt.

On the other hand, Fuji, their main competitor, found the courage that Kodak lacked and fully reinvented themselves when it was required of them, and they were able to survive.

To see such a dominant multinational enterprise employing up to 145,000 people go from paradise to hell in less than 15 years seems unprecedented!

Thus beware, because the iGaming sector is currently in the exact same situation. The only difference is that it is not a technological revolution but a customer based one. Customers that were born around the same period as digital cameras.

Why iGaming sector must change its mentality and adapt to millennialsBut you already know this because the demographics of your customer database clearly indicate that these young generations are not willing to play the way their parents and grandparents did.

Why? Simply because they were raised playing amazing skill games on their consoles and having constant social interaction on their cell phones.

So, if you think they are looking to play games of luck against the house, you have it all wrong!

They expect skill games, games that are structurally social games, graphic designs that can match the ones of the video gaming industry and not the back-to-the-future experience that we are currently delivering to them.

The iGaming sector has two choices: the Kodak one or the Fuji one.

When you speak with most iGaming leaders, they use Kodak’s exact analysis and excuse. They claim that all the new trends will remain niche markets – do you remember that argument?

They know that they have been facing problems attracting young customers, but they have a magical solution. It is called gamification.

They intend to keep their old traditional individual games that are played against the house and transform them into social games that will attract young customers tremendously. That is a typical Kodak solution!

It is time to face reality.

Remember this simple number: in 2020, youngsters, millennials, the Y generation, call them whatever you wish; they will represent 50% of the work force, that is, more or less 50% of our market. Therefore it is crucial to start listening to them.

But how can a sector listen to its own customers when it has been playing against these very customers for years? Most customers have an aversion towards operators because they know that whenever they lose, their money goes directly into your pocket. Thus, becoming customer centred with this kind of business model is like being in a Kafka novel.

Luckily, many young B2B companies are already offering products that are customized for them: Daily Fantasy Sport is, of course, one of them, and this is why we launched Oulala.com four years ago. Other options include eSports, Virtual Reality, monetized video games and so on. You already have many choices, but until you realize that the market reality has changed, you will only see them as exotic offers.

iGaming operators need to find the courage to fully reorganize their offer, their business model and their structure in order to grow within the next decade.

Let us embrace the Fuji way and start from a blank page. Let us offer customers games that will be created by taking their real expectations into account.

We should become the natural extension of the video game industry and offer the same type of quality games, but monetized!

Otherwise, other companies will definitely colonize this growing vacant space!
In DFS, DraftKings has already transformed a significant number of sports betting customers into DFS players in 2016, and this is just the beginning for them, because no one in iGaming is taking this threat seriously enough at all.

Because the iGaming sector has not embraced the future the Fuji way yet, the repercussions on our market will be massive. These are my predictions:

– Within the next 10 years, pure players, especially in sports betting and in casinos, will suffer severely and most minor ones will have disappeared.
– Games that are played against the house will become niche markets.
– Skill games will become a bigger market than luck games.
– The dominant networks will survive but they will suffer severely from a loss of income. They will need to use their financial reserve to buy young companies that have gained traction. This will be done at a high cost for them because they did not invest at the ideal time.
– Some new operators, arriving either from the video gaming industry, or from start-ups will penetrate our sector violently. They will invent the new kind of games that we have not been willing to invent and they will assume dominant positions.

History has shown that if you want to be heard, you need to make positive predictions. Therefore, I will end on a more positive note: DFS is about to become a growth driver for the iGaming sector. Why? Simply because it:

– is a real skill game,
– is a structurally social game,
– is a game that is not played against the house (DFS is a market place),
– therefore, it will allow you to be customer centred and create loyalty.

And as you all know, loyalty means more profitability; that is the kind of prediction we all want to hear.

Radical changes are always brutal and, yes, the new paradigm should be seen as a threat, but only for those who are staying where they are because for the others, the next 10 years will be a stimulating period where multiple opportunities will arise.

Valéry Bollier has over thirteen years of experience in the iGaming industry. He is a regular speaker at industry conferences and seminars, as well as a contributor to various B2B publications. Equipped with a passion for Daily Fantasy Sports (DFS) and ”Big Data”, Bollier is the co-founder and CEO of Oulala, a revolutionary fantasy football game which was launched three years ago. For any media enquiries please contact Jure Rejec +356 79 499 497.

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