CGB Winter 2015/2016 by MediaEdge

Canada's Premier Gaming Industry Magazine

Vol. 10 No. 4

Winter 2015/2016

GAMING REINVENTED:

PM 40063056

For casinos, it's time to expand the customer experience

CanadianGamingSummit.com June 13-15, 13-16, 2016 Ottawa/Lac-Leamy

Winter 2015/2016 Publisher

Volume 10 Number 4 Chuck Nervick chuckn@mediaedge.ca 416.512.8186 ext. 227

Editor Sean Moon seanm@mediaedge.ca

contents 20

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EDITOR’S NOTE

MESSAGE FROM THE CGA

COVER STORY

Gaming Reinvented: For casinos it’s time to expand the customer experience and bet on a new image

Proudly owned and published by:

16 FEATURE Buying In: Social licence and the casino experience

President Kevin Brown

President & CEO Bill Rutsey

kevinb@mediaedge.ca wrutsey@canadiangaming.ca

Senior Vice President Chuck Nervick

Vice President, Public Affairs Paul Burns

chuckn@mediaedge.ca pburns@canadiangaming.ca

Canadian Gaming Business is published four times a year as a joint venture between MediaEdge Communications and The Canadian Gaming Association To advertise: For information on CGB’s print or digital advertising opportunities: Chuck Nervick 416-512-8186 ext. 227 chuckn@mediaedge.ca Copyright 2016 Canada Post Canadian Publications Mail Publications Mail Agreement No. 40063056 ISSN 1911-2378 Guest editorials or columns do not necessarily reflect the opinion of Canadian Gaming Business magazine's advisory board or staff. No part of this issue may be reproduced by any mechanical, photographic or electronic process without written permission by the publisher. Subscription rates: Canada $40* 1 yr, $70* 2 yrs. USA $65 yr, $120* 2 yrs. International $90* 1 yr, $160* 2 yrs. *Plus applicable taxes. Postmaster send address changes to: Canadian Gaming Business Magazine 5255 Yonge Street Suite 1000, Toronto, Ontario M2N 6P4

FOOD AND BEVERAGE Dining Demographics: Can your foodservice appeal to Millennials and Boomers?

24 LOTTERIES Raising the Stakes: Reputation management and Canadian lotteries 28 INDUSTRY PERSPECTIVE Modernization to Mobilization: For gaming in Ontario, slow and steady could win the race

Food for Thought: Weighing in on foodservice at Canadian casinos

INDUSTRY Q&A

FACILITY PROFILE Cascades Casino Kamloops

36 MARKETING New Dog, New Trick: Reimagining the casino experience for Millennials 38

EXECUTIVE Q&A John Drake, President and CEO, Casino Rama

CORPORATE PROFILE Novomatic Americas

VENUES AND AMENITIES What’s New at Canadian Gaming Venues

INDUSTRY SPOTLIGHT Canadian Leaders Survey

RESPONSIBLE GAMBLING New Horizons Conference 2016

54 LEGAL Risk-based Gaming Regulation: What to consider when making the shift Official Publication of the Canadian Gaming Summit

Canadian Gaming Business | 3

W W W. A R UZ EGAM IN G.COM

4 | Winter 2015/2016

editor'snote

Changing with the Times ALTHOUGH STILL IN ITS adolescence when compared to its elder siblings in Las Vegas and Atlantic City, the Canadian gaming industry is starting to look vastly different from its humble beginnings just a few decades ago. There is no question that the Canadian industry has been able to incorporate many of the aspects that have helped Vegas transform itself into a dining and entertainment capital that extends far beyond the confines of casino gambling and sports books, while avoiding some of the operational catastrophes that have befallen Atlantic City. And while some changes have been relatively easy to adapt to the Canadian market (think food and beverage), others are sure to present ongoing challenges for casino operators, racetracks and provincial corporations in the coming years. In this issue of Canadian Gaming Business, we look at many of the ways in which our industry is changing, from the rapid expansion of non-gaming amenities such as F&B, entertainment and hospitality to the challenges of reputation management and building social licence for gaming organizations within their respective communities. Starting with our cover story from Jason Allsopp, Rose Wong and Paul Lauzon, readers will discover the latest data and trends on how Canadian consumers are embracing some of the aforementioned changes in the availability of more non-gaming amenities. Amid an increasingly competitive environment and lingering economic woes, most casinos, like those in Las Vegas, have had to reinvent to stay in the game. It’s a shift that puts the spotlight of casinos not only on gambling, but also, interactions. Lotteries, meanwhile, are finding new ways to communicate their message and create awareness of the many good works and community development projects financed, in large part, from the proceeds of the various provincial lottery programs. In an insightful industry Q&A, senior lottery executives discuss some of the challenges and opportunities when it comes to reputation management and improving social licence within the communities they serve. Also in this issue of CGB, you will find in-depth discussion and analysis of the many changing facets of the Canadian gaming industry, including: • How food and beverage outlets or service on the gaming f loor can help a casino maximize revenue and profitability and enhance the customer experience; • Why slow and steady could win the race for the modernization of gaming in Ontario; • What to consider when making the shift to risk-based gaming regulation; and • The latest CGA survey results where Canadian Community Leaders give a resounding thumbs up on casino gaming. As always we hope this issue of CGB has something for everyone. If you have any story ideas, suggestions or comments, feel free to contact myself at seanm@mediaedge.ca or CGB’s Publisher Chuck Nervick at chuckn@mediaedge.ca for advertising information. Enjoy the issue and cheers for now,

Sean Moon Managing Editor, Canadian Gaming Business

Canadian Gaming Business | 5

messagefromtheCGA

We are always asking questions and seeking answers BY BILL RUTSEY, PRESIDENT AND CEO OF THE CANADIAN GAMING ASSOCIATION

OVER THE PAST DECADE the Canadian Gaming Association has established itself as a leading voice of the Canadian gaming industry, serving as an advocate and champion for the industr y, sponsoring important research, and delivering high value net work ing, information and educational events. Our most recent research product, the 2015 Opinions of Community Leaders Study, is the f irst examination u nder t a k en of t he percept ion s of Ca n a d ia n c iv ic and communit y leaders who agreed to have casinos developed in their municipalities. We thought that the time was right to go to them and ask a series of questions to gauge the impact, both positive and negative, of that decision. Most importantly, we wanted to determine if, knowing what they know now, they would still allow a casino to open in their city or town. I don’t want to give all the study’s results here but I will let you know that community leaders overwhelmingly answered “yes” to that fundamental question. Our premier annual event, the Canadian Gaming Summit, is a conference and exhibition developed by the industr y for the industr y. Summit development has always been driven by dialog ue w ith delegates, sponsors and exhibitors, about what we can do better to deliver the highest quality event for the best value. This dialogue has told us that technology and customer awareness is changing the nature of trade shows from the perspective of  how exhibitors engage and interact with their customers, and that attendees are increasingly seeking information and education. I n r e s p on s e, t he 2 016 Su m m it w i l l emph a si z e enhanced information and education content (including

6 | Winter 2015/2016

high-profile keynotes, continuing education sessions and modules and unique research), more time and f lexibility for delegates to attend educational sessions, various networking events and pavilions on the trade f loor, and increased opportunities for exhibitors to interact with their customers. As our industry continues to grow and evolve the Canadian Gaming Summit will set a new standard for large industry information, education and networking events.   With the spectacular rise in popularity of daily fantasy sports (DFS) we asked the logical question as to whether or not, under Canadian law, DFS would be considered gambling. The answer, that as a combination of skill (choosing the best roster) and chance (the outcome of a number of games) it is gambling has led to a crossCanada dialogue about how best the matter be dealt with, including a renewed effort to legalize single event sports betting. L ook ing for wa rd, we w ill soon be conducting a national assessment to determine the educational wants and needs of the industr y, with the goal of creating continuing education modules accessible and available across a number of platforms. It is our intention to report back on and launch this initiative at the Summit in June. These are four recent examples of the type of questions we seek answers to as we fulf ill our mandate of being a primar y source of information and assisting in the development of industry wide programs and approaches for critical issues.

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coverstory

GAMING RE BY JASON ALLSOPP, ROSE WONG AND PAUL LAUZON

For casinos it’s time to expand the customer experience and bet on a new image

Odds are most people’s perceptions of casinos are exponentially different than they were a decade ago. Amid an increasingly competitive environment and lingering economic woes, there has been a growing trend among boutique and big-box casinos: They’ve had to reinvent to stay in the game. That’s why so many now position their venues as “one-stop-shops” that deliver a full range of attractions including food, drinks and live entertainment. It’s a shift that puts the spotlight of casinos not only on gambling, but also, interactions. 8 | Winter 2015/2016 8 | Winter

coverstory

EINVENTED

Canadian Gaming Business | 9

coverstory

At Ipsos, our researchers have been studying this trend for many years. In fact, we have an entire specialization devoted to just that. Our Lottery and Gaming Practice takes the pulse of Canada’s gaming population, studying their habits, attitudes and desires. We ask them what they are looking for in casino entertainment, what their expectations are, what they do inside the casino, how much they spend and how they rate the entire experience. Such knowledge enables the gaming market to create products, services and communications that are more relevant and engaging to their audience. EARLIER IN 2015, we f ielded a study to assess whether the innovative efforts made by casinos to boost engagement are paying off. What we found was that diversif ied offerings are a successful way to encourage loyalty. This time we wanted to delve deeper into how casinos can keep people coming back with nongaming amenities. In particular, we wanted to explore the harder-to-attract group of non-players, defined as those that haven’t visited a casino complex recently, but would consider it if they were to offer alternative entertainment options. We’re pleased to present some of these findings here. BETTING ON VALUE

As part of the 2015 study, we were interested to understand which factors impact Canadians when it comes to entertainment activities. In other words, what stands out when helping them choose one activity over the other? A mong both players a nd nonplayers, the top factors in choosing an enter tainment activit y are good entertainment value for money (45%, players; 49%, non-players), inexpensive price (31%, players; 40%, non-players) a nd a g reat place to g o w ith their friends, family or colleag ues (28%, players; 30%, non-players). Proximity (15%, players; 20%, non-players) is a somewhat inf luential factor when choosing an entertainment activity— but this isn’t as important as other amenity features, which suggests that people w ill t ravel if the value a nd atmosphere are to their liking. As seen in the chart below, these top factors weig h sl ig ht ly less i n i mpor t a nce among players, indicating that nonplayers may perceive an outing at the casino as being highly expensive. 10 | Winter 2015/2016

So what does this mean for the gaming industry? Above all, it suggests that casinos need to rethink how they are perceived. This rings true especially for non-players, as it appears they do not think these destinations give them much return on their money. Casinos would benefit from repositioning their venues as being reasonably priced for what they offer. SIZING UP VISITORS

Ipsos also wanted to get a look at who people choose to accompany them during out of home entertainment activities. The results of our study show that when going out for entertainment activities, the majority of players (61%) and non-players (64%) do so with a friend or a spouse. People are also likely to go with a group of friends (31%, players; 33%, non-players). Non-players are more likely to participate in an entertainment activity on their own (37%), compared to players (31%). For casinos, this information reveals that people prefer to participate in out-ofhome activities with other people, and that marketing initiatives could be made more relatable by advertising couples or multiple people.

IMPORTANCE OF AMENITY FEATURE TOTAL REASONS 45% 49%

It gives me good entertainment value for my money

31%

It is inexpensive

28% 30% 27%

It is a great place to go with friends, family or colleagues It provides a nice distraction Provides an exciting atmosphere Offers great food and beverage services Provides a great guest experience It is unique and different to any other entertainment experiences around me It is close to my home or work Received a coupon or special offer for the activity All of my friends, family or colleagues participate Received an invitation from my friends, family or colleagues Provides the ultimate bar and restaurant experience It is a great way to meet new people Provides a great shopping experience It is current and trendy

15%

40%

21% 23%

21% 24% 20% 16% 18% 17% 15% 20% 15% 13% 14% 14% 13% 12% 8% 7% 8% 8% 7% 8% 7% 4%

Players (n=1003) Non Players (n=810)

Note: Green numerals indicate a statistically significant difference between the player groups at the 95% confidence interval. Thinking about when you participate in your preferred entertainment activities, which of the following are the most important in helping you choose one activity over another? Please select your most important, 2nd most important, and 3rd most important reasons.

coverstory

WORD OF MOUTH WINS BIG

I n a d i g it a l a g e w it h t r o ve s o f information, there is no shortage of resources to draw on when choosing an entertainment activity. But which sources do people put the most stock in? Not surprisingly given our natural tendency to trust reviews from those that we know, word of mouth from friends and family (63%, players; 67%, non-players) is number one. This is followed by online research (48%, players; 48%, non-players), which suggests that a validation process occurs when weighing options. People accept reviews from people they know, and they do research via other means, such as online. Also significant in generating awareness are TV (44%, players; 43%, non-players) and coupons. Players (35%) are more likely than non-players (30%) to use coupons as a source of information. The adage “you only get one chance to make a first impression” couldn’t be more apt. Casinos need to create great impressions right off the bat, because visitors will share their experiences with their circle of friends and family. No doubt, this proves why Voice of the Customer (VOC) programs are so important, which allow companies to nullify, mitigate or rectify any issues or complaints that may arise. WHAT TO GAMBLE ON?

Next, let’s take a look at considered and actual participation in entertainment activities, with a comparison between players and non-players. When asked which activities people have considered doing in the past month, dining out at restaurants, movies, shopping and going to cafes top the list. Not surprisingly, players are much more likely to consider going to a casino as an activity compared to nonplayers (42% vs. 5%). Clearly, casinos are not on the radar as an entertainment destination for non-players, so the focus needs to be on understanding why that is in order to get these venues considered. What’s more interesting is that the majority of people who considered the aforementioned activities are very likely to actually participate in them in the near future. When comparing these

considered activities between players and non-players, the former is more likely than the latter to participate. A key to overcoming this dissimilarity lies in understanding why non-players don’t consider these venues at the same magnitude as players. One possible explanation could be that non-players are not as outgoing as their counterparts, so casinos need to consider offerings that cater to these differences. What does this tell us? If people consider an activity, they are very likely going to do it in the future. This is why it is so crucial for casinos to become part of this consideration set in order to move the needle. People are willing and open to go to the casinos, but they aren’t top of mind right now. So the issue is—how can casinos become part of the conversation? NO DICE FOR SOME

To answer this, it is helpful to first recognize why people do not consider a casino for entertainment offerings. Among non-players, the top reason cited for not visiting a casino in the past month is due to the fact that they prefer to spend their money on other types of entertainment (51%). In other words, they don’t see the value proposition in visiting a casino when they are considering all the entertainment options that are available to them. Alternative options are simply more appealing and offer a better return for their money. Although not as important, proximity is another factor that influences their visitation decision (37%). The data in the chart also suggests that there will need to be a shift in perceptions among this group as they do not feel like they can relate to the casino on an individual basis. Statements that rank higher on the list of reasons for not visiting are that casinos “are not for people like me” (20%) and “none of my friends go to casinos or play these types of games” (20%). Few (4%) are worried about the social stigma of gambling, which is indeed a positive trend that suggests the opportunity is there. All of this continues to point to the fact that perceptions are a significant barrier that casinos will have to overcome in order to get more people through their doors.

REASONS FOR NOT VISITING A CASINO IN PAST MONTH I prefer to spend my money on other types of entertainment

51% 37%

I do not live near a casino None of my friends go to casinos/ play these types of games

20% 20%

Casinos are not for people like me The atmosphere of these establishments is not appealing

14% 14%

I don't have enough time to play

12%

I don't know how to play the games

11%

I am opposed to this type of activity Lottery games are more accessible

10%

I do not like the type of games offered at a casino I have a better chance to win some money playing lottery games Lottery games are easier to understand I can no longer smoke in establishments that offer these games I am worried about the social stigma of a casino I prefer to gamble on the Internet

8% 6% 6% 5% 4% 4%

No money/ funds (for playing)

Do not want to waste any money

Base: Non Players (n=810) Note: Only responses of 2% or more are shown. You previously indicated that you are open to visiting a casino should it offer alternative entertainment offerings, but have either not considered visiting a casino in the past month, or have considered visiting a casino but haven’t done so. Please indicate your reasons for this.

Canadian Gaming Business | 11

coverstory

GETTING AN EDGE

We asked Canadians to think about what they look for in an entertainment destination. The amenities that have the greatest appeal for respondents are casual restaurants (73%, players; 72%, non-players), coffee shops (69%, players; 72%, non-players) or quick ser vice restaurants (61%, players; 60%, non-players). For entertainment destinations that are looking to attract new players, these would all be good offerings to consider adding. W hen compared to non-players, amenities that have greater appeal to players include things like shows such as music tours or comedy shows, fine dining restaurants and a variety of bars, clubs or lounges. Including these amenities can expand the entertainment options available at casinos and also continue to engage and retain the existing player base. DOUBLE DOWN ON PERCEPTION

Current opinions towards casinos reveal that success lies in going beyond adding or improving amenities. It means changing perceptions of how people view casinos as an entertainment destination. This shift is especially impor t a nt a mong non-players if being positioned as an entertainment destination is going to win at attracting new customers. Yes, casinos can create new amenities like restaurants—and such innovations will help. But the issue is more than brick-and-mortar based. Spending budgets on more amenities will boost sales in the short term; however, the big hurdle for casinos will be to shift these unfavorable perceptions to a more positive light. There is no quick panacea for this, but once achieved, it will pay off in the long run. A GLIMPSE AT SPORTING EVENTS AND BETTING

R ight now, Canadian law allows citizens to bet on a minimum of two sport outcomes at a time. Bill C-290 would have changed this by legalizing single-game sports betting. However, despite unanimous approval in the 12 | Winter 2015/2016

OPINIONS TOWARDS CASINOS Provide a variety of slot games Has appropriately dressed staff

81%

68%

Have friendly staff

81%

63%

Is a safe place to go

80%

50%

Is a fun place to go

79%

52%

Provide a great guest experience Is a place where everyone feels comfortable

83%

66%

74%

51%

73%

37%

Offer great food and beverage services

55%

Provide an exciting atmosphere

54%

Offer entertainment experience different to any other available around me

73%

Players (n=1003)

72%

Non Players (n=810)

71%

51%

70% 61%

Provide a variety of table games

Note: Green numerals indicate a statistically significant difference between the player groups at the 95% confidence interval. We are interested in your opinion of your views towards casinos. For each statement below, please rate it on a scale from 1 to 7, where 1 means doesn’t fit with my view towards a casino, and 7 means it fits with my views towards casinos. Do not worry if you are not familiar, or haven’t visited a casino recently, as it is your impressions we are interested in.

OPINIONS TOWARDS CASINOS Offer entertainment for me

69%

44%

Offer multi-faceted entertainment Is a great place to go with my family and friends

66%

35%

66% 55% 62%

Provide live entertainment Is a place for people like me

27%

Is a place I can go to for a night of entertainment without gaming

Provide a sense of community

55%

36%

52%

21% 24%

Is a great place to meet new people Is the place to be seen

58%

42%

Is cool/current/hip/trendy Is the place to be

68%

55%

28% 20%

47% 44%

Players (n=1003) Non Players (n=810)

41%

coverstory House of Commons, this bill wasn’t passed, in part because of concerns it could lead to a spike in sports-betting addictions. Given this, we thought it would be useful to paint a picture of how players and non-players currently engage in sporting events and betting. Compared to non-players, players were more likely to frequent bars or restaurants to watch sporting events on a week ly or monthly basis. Not sur prisingly, this pattern was seen a mon g t ho se w ho pa r t ic ipat e d i n sports betting in the past year. The top rea sons for choosin g a ba r or restaurant to watch sporting events are socializing (46%, players; 46%, nonplayers), the atmosphere (36%, players; 30%, non-players) and great food and beverage services (32%, players; 29%, non-players). Compared to non-players, players are more likely to participate in sports betting activities such as sports wagers, fantasy sports contests and sports pools weekly, monthly and once every 2-5 months. The majority of respondents did not par ticipate in any of these sports betting activities in the past year, driven primarily by non-players. It’s interesting to note that overall the majority of respondents would be unlikely to place sports wagers using real money at a sports bar or restaurant (64%, players; 80%, non-players) if the ability to bet on sporting events became available. IN CONCLUSION

The days of opulent and glitzy casinos are diminishing. Venues now blanket t h e c o u nt r y, a n d w it h pl e nt y o f entertainment options to choose from, today’s players don’t necessarily need extravagance. If there’s one thing they want more of, it’s value. This is one of the central findings of our study, and it’s especially true among non-players. The fact is that many people do not think of casinos as an activity that gives them a return on their money. What’s more, non-players aren’t considering casinos for entertainment because they don’t find them relatable, and don’t see it as a place to spend time with friends and family. So the best way to attract new players is to emphasize the value proposition, and change the mindset and perception of the marketplace. As one could imagine, this isn’t a quick or simple exercise. It will require a 14 | Winter 2015/2016

long-term strateg y— one that can be started by rethinking advertising and communications, and gaining a better understanding of the preferences, habits and attitudes of potential casino visitors. Those that do could hit the jackpot. METHODOLOGY

These are findings from an Ipsos Lottery & Gaming study conducted from April 8 to May 11, 2015. For the survey, a sample of 1813 Canadians was interviewed online. The precision of online polls is measured using a credibility interval. In this case, the poll has a credibility interval of plus or minus 2.3 percentage points. For more information about credibility intervals, please visit the Ipsos Public Affairs section of our website [http://www.ipsos-na.com/dl/pdf/research/ public-affairs/IpsosPA_CredibilityIntervals. pdf] at www.ipsos-na.com. The data were weighted to the casino going population of Canada by region, gender, and age. Statistical margins of error are not applicable to online polls. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error and measurement error. Where figures do not sum to 100, this is due to the effects of rounding.

About the Authors Jason Allsopp is a Vice President with Ipsos’ Lottery & Gaming practice. Based in Vancouver, Jason is part of a team of research experts dedicated to serving the market research needs of lottery and gaming organizations across Canada and the United States. Jason can be contacted at jason. allsopp@ipsos.com or 778.373.5035. Rose Wong is a Research Manager with Ipsos’ Lottery & Gaming practice. Based in Calgary, Rose is part of a team of research experts dedicated to serving the market research needs of lottery and gaming organizations across Canada and the United States. She can be contacted at rose.s.wong@ ipsos.com or 587.952.4873. Paul Lauzon is Senior Vice President and Managing Director with Ipsos Reid and head of the firm’s Lottery & Gaming practice. Based in Calgary, Paul leads the team of research experts dedicated to serving the market research needs of lottery and gaming organizations across Canada and the United States. Paul can be contacted at paul. lauzon@ipsos.com or 403.294.7386.

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feature

BUYING IN Social licence and the casino experience BY KARA HOLM

My introduction to the gaming business was unorthodox. I was hired to build bridges between a casino operation, the business community and the public at large. We were consciously working to engage more effectively with the community and build social licence. My client understood how this work was connected with gaming revenue. I quickly learned a lot about the casino industry and how casino operations are misunderstood by the general population. 16â&#x20AC;&#x201A;|â&#x20AC;&#x201A; Winter 2015/2016

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(VLTs), horse racing to local bingo, “chase the ace” and 50-50 draws, gaming has many faces. The public feelings differ on various aspects of this complex and diverse industry. Many people don’t consider ticket lotteries as a form of gambling. VLTs tend to cause more public outcry than casinos. Casinos are viewed more favourably because they offer more than just a place to participate in games of chance. The majority of casinos, even small regional casinos or community gaming centres, offer gambling, restaurants, bars and some type of performance space. Casinos also feature a high degree of security, ensuring game integrity and the safety of patrons, features that are not as visible in other legal forms of gaming and are absent in the grey market. This safety includes age controls and careful enforcement of liquor regulations. The casino oversight of patrons is central to the social licence for this form of gaming. LEVERAGING AMENITIES

THE GAMBLING SECTOR, including casinos, is viewed by many citizens as one of the “Four Horseman of the Apocalypse” along with tobacco, big oil and pharmaceutical companies. Few businesses are so polarizing. These sectors have to work harder than others to build and maintain “social licence.” Social licence is the permission businesses receive from the public to operate in their jurisdiction. It is particularly important to the gaming industry in Canada because gaming is regulated by the provinces, making the social responsibility requirements highly visible. CHANGING PERCEPTIONS

Most of us who work in gaming have had the experience of telling a new acquaintance what we do for a living and receiving a cool, superior stare, full of reproach and judgment. This occurs because in many Canadian markets the majority of the population has a neutral to negative opinion of the gaming sector. When I meet “doubters” I talk about the positive economic impacts of gaming, the number of Canadians employed in the sector, and the actual incidence of problem gambling in Canada (3.2%1) and how all casinos have programs to deal with it. In my experience, many people don’t care about the facts. Facts get in the way of a good of story. Fortunately, public perception and social licence are fluid and can change over time. “Gaming” is a big tent. From ticket lottery to casinos, online gambling websites to bars with video lottery terminals

Smart operators and their government partners are working to influence social licence, many of them leveraging non-gaming amenities and building social licence considerations into their businesses in a strategic and purposeful manner. Michael Graydon, President of ParqVancouver, which is developing an exciting new destination resort casino in downtown Vancouver, recognizes the importance of social licence and makes it a key consideration in the project’s development plans. “Parq Vancouver is enriching and strengthening the fabric of our community and team through various social programs and commitments enshrined in an agreement with the city of Vancouver,” says Graydon. “This includes the active and ongoing hiring of a minimum of 10% of construction and operations staff from neighbouring at-risk and marginalized communities; a similar level of commitment to purchasing local supplies and services… selecting art and showcasing local artists from our Downtown Eastside and ultimately providing venue space and other in-kind benefits to worthy local not-for-profit organizations. This not only directly benefits engaged families and others in our local community, but it creates positive relationships, pride and even social license for our project.” On the east coast, Casino Nova Scotia (CNS) just launched “The Casino Nova Scotia Music Hall of Fame” in Halifax with a site planned for the Sydney property in 2016. This project was initiated following the success of the “Casino Nova Scotia Artist in Residence” program which provides funding to new artists to help them establish their career, provide a year-long performance platform and learn the music business. CNS has received more earned media as a result of these two initiatives than any past projects. Canadian Gaming Business | 17

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SUPPORTING THE ARTS

“Community engagement needs to be more than two words on a list of values,” says CNS Executive Director Chris Roberts. “Initiatives like the CNS Music Hall of Fame have a brand impact that money can’t buy…. Music is important to our business and our brand, but it’s also a cultural cornerstone in Nova Scotia. We can’t own music – the communit y, the people own music. But we can create a place where our neighbours and guests and staff can share music and make memories. That’s powerful.”

Rober t s raises something ver y important: the need to ensure that these positive activities are communicated outside of the casino operation and into the broader communit y. The engagement of government partners is key in this effort. If governments do not shine a light on the positive contributions made by gaming in their jurisdiction, then getting information out about the gaming sector, beyond the players who have a favourable view of the industry, and into the general population, is challenging. Governments find it difficult to talk about casino gaming because it is controversial, so non-gaming amenities like restaurants, entertainment venues and attractions provide an alternative. Back in Nova Scotia, the Nova Scotia Provincial Lotteries & Casino Corporation (NSPLCC) champions the good work being done by CNS. Bob MacK innon, President and CEO of NSPLCC, makes the connection beyond gaming revenues and employment and reaches into the broader community.

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BROAD COMMUNITY REACH

“Music is a large part of the fabric that makes up what it means to be Nova Scotian and a healthy arts community means economic prosperity,” says MacKinnon. “It’s no secret that a province strong in the arts can create jobs, attract increased tourism and stimulate business activity and we are proud of the role the gaming industry plays in helping achieve this.” It is important to remember that many casinos in Canada got their start as charity casinos. This connection with charity remains strong in many provinces and is in the industry’s DNA. Alberta stands out in this regard as charity representatives are required on site during all operations of the casino table games. Manitoba still uses community group volunteers. First Nations casinos also operate on a similar principle, investing the money made through the casino enterprise back, into the community. We have seen studies that suggest in markets where this charitable connection is direct, public support for gambling and, therefore, social licence is better established. Casinos all over Canada support events and activities that anchor them more closely to the communities in which they operate. By hosting fashion shows, art exhibitions, dances, dinners, concerts, charity auctions, and more, casinos plug into the activities that are valued by their customers, employees and the broader community. As a result, over time, more people are introduced to the property and develop a higher degree of comfort. This discussion of social licence and the casino experience would not be complete without considering the core casino customer. Casino customers come in many different forms: from older customers who like to visit casinos often because they can get good value food, meet up with friends and have a little thrill, to casual entertainment customers who come to eat, see a show and maybe do a bit of gaming with their friends, to the classic “high roller.” SIMILAR EXPECTATIONS

SAS and all other SAS Institute Inc. product or service names are registered trademarks or trademarks of SAS Institute Inc. in the USA and other countries. ® indicates USA registration. Other brand and product names are trademarks of their respective companies. © 2015 SAS Institute Inc. All rights reserved. S144062US.0815

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W hat do these customers have in common? Casino patrons expect dining, entertainment and gambling to come together into a single, safe and entertaining experience. They’ve seen Vegas in the movies and they expect the same kind of casino experience at home. They’re hungry; they’re thirsty; they want a pleasant night out to watch a show or do a little gaming. There is a lot of competition for the players’ discretionary entertainment spend

feature so casinos need to “win” their business. If you feed players, they may extend their visit. If you offer a great show at a good price or a compelling food special, customers might make that special (incremental) trip to your property. Another layer in the complex question of social licence is the relationship between casinos and their competition. These local and national businesses may be concerned that government-operated businesses have unfair advantages in the market such as extended operating hours, pricing/discounts, and marketing support. Non-gaming amenities are a vital and important part of the total casino experience for patrons. They have to be designed to meet player/patron needs as well as align with your property’s brand and value proposition. As operators ponder how to incorporate social licence considerations into their businesses, they must always keep their eye on their core customers. KNOW YOUR AUDIENCE

Will a new amenity like the CNS Music Hall of Fame, or an upmarket steakhouse, or a drag show resonate with the players at a specific property? The effort to show value to the broader community cannot overshadow the customer experience. There is a risk for casino operators that develop amenities without a clear sense of their audience. The most successful food and beverage outlets are targeted to a specific audience. We have observed that many casinos try to make everyone happy, which results in an indifferent experience that satisfies no one and does not support the development of social licence. It is like airplane food: everyone can eat it but no one enjoys it. Satisfied players have a role to play in developing social licence as they are unofficial advocates for the industry. If the experience they receive at your casino meets or exceeds their expectations, they become the very best ambassadors for your property and the industry in general. Social licence should be in the foreground when casino operators and their government initiate their annual business planning process, as well as longer-term strategic planning. While operators and governments cannot control public perception, they can influence it with careful, customer-driven decisionmaking. Non-gaming amenities and the success thereof are key to developing social licence for casino gaming. They positively differentiate your casino from other gaming venues and options while ensuring your government’s and your players’ needs

are being met and exceeded. They also keep your customers satisfied and entertained. Building social licence considerations into your business plan, and aligning non-gaming amenities with your customers’ preferences is an “all-in” and winning strategy. Kara Holm is the ExO for Strategic Insight & Application with All-In Gaming & Hospitality Advisory Group Inc. and Curator of the blog www.itisadirtyjob.com. All-In is an innovative new Canadian-based think-tank that offers a unique, all-inclusive perspective that considers the customer, operators, and government agencies and regulators in the delivery of gaming experiences and associated revenues. All-In is dedicated to issues of social responsibility. Web: www.all-inadvisorygroup.com; email: kara@all-inadvisorygroup.com; phone: (902) 830-4884. 1.Williams, R., Volberg, R., Stevens, R. (2012) The Population Prevalence of Problem Gambling: Methodological Influences, Standardized Rates, Jurisdictional Difference, and Worldwide Trends. https://www. uleth.ca/dspace/bitstream/handle/10133/3068/2012-PREVALENCE-OPGRC%20(2).pdf?sequence=3

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Canadian Gaming Business | 19

foodandbeverage

DINING DEMOGRAPHICS Does your casino foodservice appeal to Millennials and Boomers (or is that even possible)? BY JEFF DOVER

Food and beverage is important in casinos. An Ipsos Reid study completed in 2013 for the Canadian Gaming Association showed that one-third of casino patrons dine in the casino’s restaurant(s) on a regular basis—and it’s not just complimentary food and beverage. Those casino patrons visiting restaurants spend an average of $53. Having food and beverage options on site that appeal to patrons extends player length of stay, thereby potentially increasing those players’ drop.

20 | Winter 2015/2016

foodandbeverage

IF GAMERS LEAVE a casino to eat or drink offsite, the chances of them returning to game that day do not favour the house. Food and beverage outlets or service on the gaming f loor can help a casino maximize revenue and prof itabilit y and enhance the customer ex perience. Destination rest au ra nt s a nd ba r s prov ide a n option for casinos to convert diners to gamers. PURCHASING POWERHOUSE

Fo r t h e f irst time ever in 2 014, Millennials represented the largest group of restaurant diners in Canada. This gastronomical title had been ow ned by the Baby Boomers for decades as this generation spent their money instead of saving it to give to their children, driving the growth of full-service dining in Canada. Fiftythree per cent of Millennials dine out at least once per week, compared to the Canadian average of 43 per cent. In the gaming business, Millennials and Post Millennials (born between 1982 and 20 0 0) are an attractive market segment for casinos—and important for the future of casinos. At the risk of sounding morbid, the Boomers (generally considered to

be those born bet ween 1943 and 1962) will not be around forever. Nevertheless, Millennials are proving to be challenging to attract to casinos. According to the Minnesota Gambling Survey, the percentage of Millennials that gambled in the past year declined significantly between 1995 and 2012 while Boomers who gambled increased. The Ipsos Reid study concluded that tomorrow’s gambler will not look like today’s gambler and the bricks and mortar casinos will have to evolve signif icantly to attract this market segment. Casinos are grappling with how to attract this segment and convert them into loyal patrons. One potential way to do this is by providing food and beverage offerings that appeal to this segment. SEEK DIFFERENT EXPERIENCES

However, Millennials and Boomers want totally different ex periences when dining out. The top attributes Boomers are looking for in a dining ex perience according to the NPD Group are cleanliness, service and menu variety. Millennials seek dining experiences with great atmosphere, Atmosphere is impor t ant – a craveability and those that are likely to restaurant that attracts Millennials be recommended. must be a place where they want to spend time, and this is challenging. Often, the “place to be” doesn’t last and is quickly replaced by the latest place. Unfortunately for casinos, who want to ret ain the Boomers while developing Millennials into gamers, restaurants frequented by “old people” are not considered by Millennials to have a good atmosphere. Millennials want craveability in the food and beverages they purchase. They want to customize their orders— restaurants with “no substitutions” do not appeal to this generation. Gourmet burgers, burritos, pizza and the like that customers can “build themselves” by selecting ingredients are popular with this group. Canadian Gaming Business | 21

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Likelihood to recommend is also important. Millennials want to be seen at the trendy places and want others to know they are there. Sharing where they are and what they are doing on social media is a requirement when dining out, and they share both positive and negative aspects of the experience. It seems to older generations that Millennials find it more important to be seen than enjoying the experience. This isn’t the case, as atmosphere and craveable food is more important. However, the social status achieved by sharing an experience is part of the social fabric of this generation. These “reviews” are important—a majority of young diners will search for information from their friends before choosing a restaurant. Restaurants are using social media to target this market—but they must get the message right. Marketers able to successfully drive business using social media are typically Millennials themselves. Companies that don’t understand social media can do damage to their brand perception by young consumers. Socializing while dining is also important and Millennials prefer large community tables. ETHICALLY INSPIRED

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Younger customers want to dine at restaurants that they perceive as ethical—use locally-sourced, organic or fair-trade ingredients; are environmentally friendly and are good corporate citizens. Brands such as Starbucks, who are positioned as being socially progressive, are popular with younger diners. They will expose and shun restaurants that “green wash” and don’t really commit to the concept of being environmentally responsible. Like the aging Boomers, Millennials want healthy food. However, this younger generation defines healthy differently than Boomers, who count calories. Millenials want to know about their food, where it was grown, how it was prepared, and seek foods that

22 | Winter 2015/2016

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foodandbeverage are fresh, not processed, and made from scratch using authentic ingredients and recipes. Organic, hormone-free, free-range chicken and eggs all have cachet with this generation. To some extent, they are willing to pay a premium for such ingredients— but not a significant premium. Also, this generation wants the option of different portion sizes. The preferred service style for Millennials is fast-casual. The definition of fast casual is somewhat varied depending on who you ask but essentially offers quality similar to casual dining restaurants, but ordered at a counter and served at (or close to) fast-food speeds. Fast casual restaurants typically make it easy to customize your food and actively welcome you to do so as part of their product offering. Customizable products are essential for this group who also like “secret” menu items that aren’t displayed in the restaurant but available to those “in the know.” Fast casual is a great format for operators given the lower fixed costs. However, to attract young diners the staff must share their values. Boomers, on the other hand, strongly prefer table service when dining out. Millennials also want to use their smart phones to order, hear about specials and manage loyalty programs. The willingness to pay using cell phones, however, is not as widely accepted. DUELLING PRIORITIES

Clearly, Millennials dining-out habits and desires are different than that of the core gaming customer, Boomers. Boomers want to relax and enjoy their meal while, conversely, Millennials want to be served quickly “what I want, when I want and where I want.” Larger casinos that can provide more than one foodservice

offering may be able to position different outlets for different consumers. Can a smaller casino, with a single foodservice outlet, meet the needs of both generations? Too many restaurants try to appeal to everyone and end up appealing to no one. If it is possible, offer two outlets: one full service targeting Boomers and one fast casual targeting Millennials. As the time comes to renovate casino restaurants, consideration should be given to restaurant concepts that target Millennials as converting this group to gamers is important for the future success of your property. Hire Millennials to operate and market these outlets. Empower these managers with the authority to make decisions that will attract younger diners. At the same time, provide these managers with insights into the current core clientele and the importance of the older generation to the current business and let them determine how to make the foodservice outlets attractive to Boomers as well. Jeff Dover is a Principal with fsSTRATEGY, an alliance of senior consultants focusing on business strategy support - research, analysis, innovation and implementation - for the foodservice industry. Their team has extensive consulting experience in foodservice across Canada. They also offer international experience, having worked in the United States, Australia, South America, Africa and Europe. The fsSTRATEGY team is unique in that they provide service to all foodservice sectors (restaurants, attractions, hotels and resorts, gaming establishments and institutions) and all levels of the foodservice supply chain (growers, processors, distributors and operators). For more information, visit www.fsstrategy.com

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lotteries

Raising the Stakes

Reputation management and the public perception of Canadian lotteries

Like most sectors of the Canadian gaming industry, provincial lottery corporations have a lot at stake when it comes to creating positive awareness of their products and community programs. Canadian Gaming Business recently asked senior lottery officials from across Canada about the challenges and opportunities of reputation management and community engagement. Here is what they had to say. Participants: Susan Dolinski Vice President, Social Responsibility and Communications, British Columbia Lottery Corporation

24â&#x20AC;&#x201A;|â&#x20AC;&#x201A; Winter 2015/2016

Scott McWilliam Vice President, Sales and Marketing, Atlantic Lottery Corporation

Wendy Montgomery Vice President Marketing and Sales, Ontario Lottery and Gaming Corporation

Guylaine Rioux Vice President, Responsible Gambling and Social Commitment, Loto-Quebec

Bill Robinson Chief Executive Officer, Alberta Gaming and Liquor Commission

lotteries

WHAT KIND OF CHALLENGES ARE LOTTERY ORGANIZATIONS FACING WHEN IT COMES TO REPUTATION MANAGEMENT AND COMMUNITY ENGAGEMENT? Susan Dolinski: A long-term challenge for BCLC has been

to change the public conversation about gambling in B.C., where a quarter of the population is opposed to all forms of gambling and the majority of people are indifferent. Over the last couple of years, we’ve come to see this “indifference” as an opportunity and have developed strategies that aim to make the public want to better understand our business. This year, we positioned ourselves to address this challenge by creating a campaign for BCLC’s 30th anniversary called “Play it Forward” which was a vehicle for BCLC to share positive stories about how gambling dollars benefit communities across the province.

Scott McWilliam: We’ve got to embrace complete transparency, authenticity and accountability. If we do, we will successfully navigate the social stigmas that persist about lottery. These are key to building a positive reputation, gaining social licence and engaging the community. Another challenge is accepting competition is here and players have choice. By delivering competitive experiences, we can sustain and grow that player relationship. Wendy Montgomery: In the lottery business, reputation

management strikes at the heart of what we offer customers: A fair game. Customers need to have trust in integrity in our systems and processes of purchasing and redeeming a lottery ticket. This was driven home to us in 2007 when OLG confronted issues with retailer fraud. It took one high-profile case for the Ontario public’s opinion of OLG to fall from 70% of people with a favourable opinion of OLG to below 50%. We had to act quickly to implement a number of significant changes to the process of selling and redeeming lottery tickets to ensure that we paid the right person the right prize. Not only did we improve the process by making it substantially more secure, but we also had to communicate the change to customers and the public. OLG launched a public awareness campaign to educate customers to sign their tickets; to watch the customer display video; to listen to the winning sounds; and to use the ticket checkers installed in every store. We learned hard lessons through that reputation crisis and are better positioned as a result.

Guylaine Rioux: Lottery corporations face many challenges, especially in today’s context, where the gaming industry throughout the world is experiencing a downturn. Those challenges include popular myths and beliefs regarding gaming, ever-evolving technological innovation and the variety of increasingly demanding clienteles whose entertainment budget is not very f lexible. The new tack Loto-Québec has chosen is to move towards more global

entertainment with combinations of what we do best, including lottery products, casinos, interactive gaming areas, online gaming, restaurants, show venues, accommodations and nightclubs. We also maintain a web site entirely dedicated to responsible gaming (agameshouldremainagame.com) and, in order to adapt to a constantly-evolving market, we have updated sponsorship and volunteer social programs by better aligning them to our corporate mission. Bill Robinson: Social responsibility and social licence form the cornerstone of what we do. In Alberta, everything is backstopped against a gambling program that supports charities. Last year alone, our charitable model provided well over $300 million to charities and that money goes right back into the communities for everything from school playgrounds to community development. We want to develop very strong programs, such as recently rolling our Game Sense where we really put an emphasis on the value of explaining to the player what all of the gambling systems and processes are all about, assessing what kind of gambler you are and making sure that we are not riding on the backs of those who may be experiencing difficulty with gambling.

WHAT ARE SOME OF THE WAYS LOTTERIES CAN CREATE POSITIVE AWARENESS OF THEIR PRODUCT OFFERINGS IN TERMS OF THE BENEFITS OF THEIR PUBLIC AND COMMUNITY ENGAGEMENT PROGRAMS? SD: Research tells us British Columbians feel better about our industry when they understand how gambling proceeds benefit local communities. Therefore, the biggest opportunity to grow positive awareness lies in closing the information gap by educating the public. I see boundless opportunities to share stories and build brand awareness at the grassroots level in communities, on social media and also through proactive media outreach. This year, BCLC was able to educate the public through our “Play it Forward” campaign which included paid and earned media, sponsorships and outreach through social media. SM : There is always opportunity through community

involvement but community engagement is so much broader and we’ve got to get better at it. We’re comfortable “marketing” our corporate brand but we tend to be humble corporate citizens hesitating to “toot our own horns.” That has to change. We are a safe and regulated industry and we should be proud to share the benefits that go back to our communities. We’ve simply got to get better at telling your story in a way that resonates, repeatedly. But let’s not assume we know what resonates. Ask people. Be deliberate, consistent, and relentless. Canadian Gaming Business | 25

lotteries

WM: One of the greatest opportunities for positive lottery

awareness is winners. In a recent study, 59% of respondents told us that hearing about recent winners makes them want to buy a lottery ticket. This percentage increases to 70% among customers under 35 years old. Broadening awareness about the amount of prizes and stories about actual winners are very compelling to customers—and non-customers alike.

GR: We need to be proactive and maintain a dynamic and

relevant presence on social media by establishing associations with external content promoters who will mention our initiatives on their platform. That way, we can broaden our presence to reach new audiences and present our entertainment options and the many events in which LotoQuébec participates. By doing so, we can get closer to our customers and attract new clienteles while aligning such social programs as sponsorships to our commercial needs.

WHAT KIND OF AN IMPACT WILL THE INTERNET AND MOBILE TECHNOLOGY HAVE ON THE DEVELOPMENT OF REPUTATION MANAGEMENT PROGRAMS? SD: Technology has created a new opportunity to reach players and communicate with them on an entirely new level. The proof is in the statistics. I recently read a “Mobile Personas” study which found, not surprisingly, that 90 per cent of Canada’s Millennials are mobile. I think this hyper connectivity provides an opportunity to connect with our players and share messages surrounding social responsibility – this could be done through owned social media channels or through targeted mobile push notifications in the future. SM: New technologies give players choice and voice – and we must be part of both of these options. Currently we aren’t equipped but we’re on a crusade to rectify that. Our survival depends on it. Technology has gone from a competitive differentiator to table stakes. Regretfully the lottery industry is a decade behind commercially competitive industries. Once mastered, it can be leveraged to be quick, entertaining, and most importantly – a means to get closer to our customers than ever before. It’s not just about the products anymore; we need deliver what they want AND to be actively involved in the conversation. WM: Growth in social media and mobile communications with

lottery customers is critical to engaging players and ensuring lotteries remain relevant. Lotteries have the best content that is natural to the business. We create winners who have magical stories that everyone loves to share and talk about. This content is gold to any social media channel. At OLG, we are now much more active in social media promoting our prizes and wins—and on the other side, in monitoring and managing our reputation. That’s only going to continue to expand, particularly as we have launched iGaming.

26 | Winter 2015/2016

BR: Game Sense will be everywhere for us — lottery, instant ticket, etc. It will be all things to all aspects of lottery gaming in Alberta. But it is important to remember that while we can provide greater access to lottery gaming, we can’t provide greater access at all cost. We’re going to have to keep our eye on the ball as far as social responsibility messaging around ticketing increases.

WHAT OTHER CUSTOMER ENGAGEMENT TRENDS CAN LOTTERY OPERATORS LEVERAGE TO CREATE AWARENESS OF THEIR CHARITABLE AND COMMUNITY PROGRAMS? SD: Thanks to the rise of social and mobile technologies,

customers and players hold more power than ever before. Creating connected online communities can go a long way to developing that all-important groundswell of support. Perhaps it is one of the oldest trends in business but the best way to improve public perception and create awareness is to work in partnership with stakeholders. Ultimately, Canada’s gaming industry should be the envy of every other industry from a social responsibility perspective as our true purpose is to create benefits for communities. We do this through the revenues we generate for government but also through the jobs we provide and the economic activity we generate.

WM: Experiential events and pop-kiosks can help lotteries to create awareness and excitement of the good works they do and where the money goes. In May of 2015 we very publicly celebrated the 40th anniversary of our very first lottery draw. That event kicked off a campaign that reminded the public why OLG was founded in the first place. WINTARIO was launched to support worthwhile community and arts projects and that’s still our goal today. GR : By aligning its entertainment mission and social

involvement, the corporation can create projects and products that arouse the public’s curiosity and attract media attention. It is in that context that we launched an initiative last summer to promote our role as a full-range entertainment provider. Loto-Québec therefore progressed from being an event promoter to an agent of entertainment. Loto-Québec also decided to put its many winners in the spotlight, either via publicity, press conferences or short videos posted on our web site and on social media.

BR: On of the important benefits to all of the gambling programs, particularly in Alberta, is that the revenue goes into the lottery fund. We’ve put about $1.5 billion from the gambling program back into the province for use in building roads, highways, schools, hospitals, etc. It is used for the communit y good across the board. We have to be careful that we are consistent with that messa g e a nd that we ma ke people underst a nd the benef its. We have to keep doing things like sur veys relative to how people understand these programs.

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industryperspective

MODERNIZATION TO MOBILIZATION When it comes to gaming modernization in Ontario, slow and steady could win the race

BY LARRY FLYNN

It is closing in on four years since OLG and the provincial government announced plans to modernize gaming in Ontario. The principles and intentions behind the decision are well stated and, as is evident by the RFP being awarded for the Eastern bundle, the plan is moving forward. Further evidence of this would be the recent release of the RFPs for both the Northern and Southwest bundles. Mobilization is now underway. MANY HAVE complained that the process is taking way too long. Potential RFP proponents wanted it to move quicker. Many employees also would have preferred to “get on with it” but what is important to realize is that OLG wanted to be at a much different stage in the process by now as well. The plan was designed to be complete and up and running by 28 | Winter 2015/2016

now. Unfortunately, it isn’t. But that leaves everyone with the obvious: Deal with what you’ve got, not with what you wanted because the hands of time aren’t going back.

although I can’t always say that I have had the luxury of managing that way. In this case, however, that is exactly what has been happening. Getting it right with the Eastern bundle wasn’t a “nice-to-have,” it was a necessity that had to withstand the test of time. Twenty-two years, give or take, is a TREADING CAREFULLY Let me also offer this: I am a strong very long time to have to live with a clause proponent of measure twice, cut once, in a contract that didn’t get it right. OLG’s

industryperspective Board demanded it be done right and the government demanded exactly the same. Does that mean the next two decades of private sector operations of casinos will be done flawlessly? If you believe that, you might want to think again. However, by today’s standards and the associated expectations, I am willing to bet (and yes, I can now) that OLG, the government and Ontario Gaming East LP feel very comfortable that they did get it right in 2015 terms. COMFORT LEVEL EXPANDS

Speaking of getting it right, another valuable point of reflection for me was that this level of soft “privatization” was new to the government. Casino gaming — which for the purposes of my point I mean resorts, slots at racetracks and the current smaller casinos — have only been up and running in Ontario since 1994. A mere 21 years later we are unbelievably close to having private sector operators taking on the accountability and financial responsibility of their existence, development and success. With this province’s comfort level regarding the oversight of both gaming and liquor, many would agree that this is a quantum leap. Wearing my old LCBO hat, which began in 1927, I applaud the courage of government to both entertain and enable this change in thinking about private sector engagement. It is the right thing to do for the gaming industry in Ontario. I am not trying to compare both liquor and gaming here; I am talking about what is needed to deliver outstanding customer experiences. Walk into hundreds of LCBO’s updated stores and you will understand my point. They have been invested in to enhance and expand the experience. They deliver what customers demand: products, ambiance and helpful, knowledgeable employees. It took lots of money, a crisp strategy that has been followed to the T and a corporate culture focused on service, which meant a training and development foundation that provided employees with a means by which they too could exceed customer expectations. The LCBO got the financial support because the needed investment was small compared to the billion dollars that OLG needed to become current with what customers in Ontario demanded and deserved. CHANGE IS CONSTANT

So back to where this lead, some have also told me that taking as long as it has

may drive changes in who is interested in becoming operators in Ontario. This is a very valid point and the list of those bidding might well and likely will be different then it would have been back when this started in March, 2012. Remember though, the last four years have seen big changes in the money markets that collaborative efforts depend on for financing. Mergers, acquisitions and bankruptcy protection all play a part in corporate direction and decision-making. It brings to mind that old saying by Heraclitus, “The only thing that is constant is change,” that is still relevant today. Let’s also remember that time wasn’t the only enemy of success, clarity needed to be sought and that involved engagement with municipalities across the province. So in many cases as the fog lifted on communities’ willingness, or lack thereof, to participate, some potential players felt differently about the opportunity. That was to be expected. I am positive that those participating with the remaining bundles up for grabs will achieve modernization’s objective handily. IMPROVED CUSTOMER EXPERIENCE

As someone now on the other side of the process, I am still excited by the potential to serve the customers of gaming in Ontario better then the current structure could do. Investments in the bricks and mortar, expansion of amenities, the addition of table games and slots along with the placement of new facilities for the convenience of customers will go a long way to improving the customer experience that in turn will drive loyalty. One of many upsides that operators will quickly recognize as improving the value proposition of their significant investments is the fact that current gaming employees in Ontario get it when it comes to delivering outstanding customer service. You can’t (OK, actually you can) but a price tag on already having a superior service culture as opposed to having to start from scratch. Remember, as it relates to gaming, the employees are the secret sauce in this transaction — they might well be the answer to how Cadbury gets the liquid in its chocolate bar, metaphorically speaking. Experts say it takes five-plus years to change the culture of a company. That just won’t be required here. Sure, new folks will make adjustments to ensure that practices align with their corporation’s culture but OLG and resort employees

have demonstrated that they are very adaptable to change. The added bonus is that relationships have been established and nurtured for over 20 years in the province. New operators will quickly discovery that they won’t have to fix what isn’t broken they will simply build their success on its solid foundation. Granted, they might say it’s what they bought and they will be more then right. The good news is that they can now invest training and development money in areas that will take the employees and managers to the next level to better suit the enhanced product offering and amenities that they will now be delivering to customers. STEPS IN THE RIGHT DIRECTION

So what really is there left to do and how long will it take? Well it doesn’t take much to recognize with only one down there are still six RFPs to go on the gaming side of their business. I am sure that OLG’s team, which we all know has undergone constant change over the same four year period, at almost every significant level with both the executive and senior leadership tiers, is anxious to move forward. They have worked hard to refine and adjust the plan. They have the integration of horseracing as part of the strategy now front and centre as opposed to being out of scope (which I know they take seriously) and they remain very conscious of how important getting on with this is — to the proponents, to the government, to the host communities, to the employees that they value dearly and most importantly to the customers that will be the benefactors of a 21st century gaming offering created and delivered as they want it. After all, as someone else once said, “if you’re not doing it for the customers, you shouldn’t be doing it at all.” How long does that add up to in time? My guess is as long as it takes! Larry Flynn, C.Dir., is the retired Senior Vice President of Gaming for Ontario Lottery and Gaming where he was responsible for oversight and management of all OLG’s 24 gaming properties. Previously, Larry spent 26 years with the LCBO where his last role was SVP, Merchandising. Larry is a recipient of the 2012 CGA’s Industry Leadership and Outstanding Contribution Award. Larry is now the Principal of 2 Vice Advice Inc., offering consulting services to the Gaming and Liquor industries and also a Partner of Marinelli and Flynn, Gaming Advisors. Contact Larry at larryflynn@2viceadvice.com. Canadian Gaming Business | 29

industryq&a

FOOD FOR THOUGHT F&B directors weigh in on the importance of foodservice operations at Canadian casinos

As the Canadian gaming industry continues to adapt to changing demographics, advances in technology and an on-going battle for the consumer’s entertainment dollar, food and beverage services have taken on a central role in most casino operations across the country. Canadian Gaming Business recently asked F&B directors from Canadian gaming facilities about the increasing importance of food and beverage in the overall customer experience and how operators can gain market share through the use of innovative F&B offerings. Read on to hear what they had to say…

r, quor

30 | Winter 2015/2016

industryq&a Participants: Steve Chase Executive Director, Food & Beverage, Fallsview Casino Resort

Alain Dumonceaux Executive Director, Food & Beverage and Events, Manitoba Liquor and Lotteries

Karsten Purbs Director of Food & Beverage, River Rock Casino Resort

Greg Van Stone, Vice President, Food & Beverage, Pure Canadian Gaming

WHAT ARE SOME OF THE BIGGEST CHALLENGES FACING CASINOS AND GAMING ORGANIZATIONS WHEN IT COMES TO FOOD AND BEVERAGE AMENITIES?

AD: Our greatest growth opportunity lies with the gaming customer who does not necessarily want to eat. We have developed plans over the next few years to focus on that group. For example, we are looking at serving customers directly at the gaming station.

Steve Chase: The biggest challenge for us in F&B is to remain

KP: For the larger sized properties throughout Canada, I see the

current. Food and beverage is still the No. 1 amenity that supports gaming. We have world-class entertainment, a great spa and hotel accommodations but it seems to always come back to the food. People come here for our food offerings.

Alain Dumonceaux: Top of the list is balancing operation costs

versus customer expectations. Our market research indicates that our core gaming customers have three issues with food and beverage: Price, value and variety, especially when it comes to buffets. Balancing these expectations can be challenging. As an organization we are addressing our customer wants through a renewal process for both Club Regent Casino and McPhillips Station Casino. Even though the renewal will provide a refreshed casino floor, a focus on non-gaming amenities will continue.

Karsten Purbs: There needs to be a better understanding of the

impact your F&B offerings will have on your property, realizing that there are significant opportunities to drive visits to the property and drive overall profitability. Food and beverage needs to be treated and looked at as a part of the destination. As operators look to grow the new player segment, F&B is one opportunity that must be utilized to help with this. Guests are looking for more out of the F&B offerings and you need to stay on top of this through investment, products, training and leadership.

Greg Van Stone: We are constantly faced with both internal and

external challenges some within our control and many outside of our control. The one common denominator between the two is reacting to these challenges as opportunities versus excuses for underperforming. Our goal is to ensure consistency and value for our guests while allowing a chance to relax and be served in an exciting, clean, friendly environment. We are constantly working to create and implement compelling food and drink specials that create a bond of loyalty with our players and guests.

WHERE DO YOU SEE THE GREATEST GROWTH OPPORTUNITIES FOR FOOD AND BEVERAGE OPERATIONS IN CASINOS IN 2016 AND BEYOND? SC: The greatest growth could be in something like our catering operations. People are getting tired of having their meetings and banquets in a ballroom so we’re seeing groups of 15 to 50 where they want a reservation in one of our fine-dining restaurants. Looking at the restaurants themselves, one of the things we have been successful with, being that these restaurants were originally developed and built for our gamers, is creating an opportunity for the tourism and travel market on quieter days and non-weekends. We’re here for the gamers first and foremost but it doesn’t mean we should have an empty restaurant on a Wednesday night when we can possibly fill it with the corporate or local tourist market.

convention/banquet operations as a huge opportunity for the future. More and more businesses value the attraction of hosting meeting/events at casino resort properties. Typically these are early to mid-week bookings help to grow your F&B/Hotel and gaming revenue during slower periods in the weekly business cycle.

GVS: The greatest growth opportunity lies in the ability to

differentiate yourself from the competition. We believe this can be achieved through hiring the best, providing superior guest service and ensuring the highest quality, innovative menus. Casinos offer the same table games and slot machines but the team that provides the best service and food is where you can truly separate yourself from the pack. We also believe growth will come from the menu items that we serve. Consumers today expect to have value, quality and consistency with each visit. For this reason, we revise and enhance our menus twice a year based on direct feedback received from our guests.

HOW MUST GAMING ORGANIZATIONS CONTINUE TO EVOLVE IN ORDER TO ADDRESS THE NEEDS AND PREFERENCES OF CUSTOMERS ALONG WITH CHANGING DEMOGRAPHICS? SC: Our newest restaurant is an Italian restaurant. You could say that Italian restaurants are always going to be popular but the reason we chose to open this one in Niagara Falls is that we have a very large Italian population here and in nearby Toronto. Our Chinese restaurant was built for our biggest and fastest-growing market in the Asian sector. We built an authentic Asian restaurant (where most of the patrons speak Cantonese, for example) but we’re hoping our non-Asian guests will also want to come in and enjoy the authentic Asian cuisine. But our initial goal was to build an Asian restaurant where our Asian customers would feel comfortable in their own cultural environment. AD: Much of the information available regarding Millennials

indicates this group is looking for experiential opportunities. Casino operations that develop a hybrid of multi-media, interactive game play and chic food and beverage offerings stand a better chance of attracting Millennials. Pop-up floor bars with entertainment, pop-up restaurants and mobile ordering and payment apps all appeal to new and younger customers. In the meantime, operators can’t lose sight of their current customer. Taking a holistic look at your entire F&B offering within the casino environment and measuring as a single unit and on its own merits should yield valuable information.

GVS: The proliferation of iGaming and social gaming has widened the generational gap we’re facing and reaching the Gen X’ers and Millennials through such a competitive environment has made Canadian Gaming Business | 31

industryq&a attracting new loyal players a much more difficult task for our industry. So ultimately, the key task, whichever medium or format that we’re using to deliver our message, is to ensure a consistent wide range of offers and communication to our audiences. Gaming-oriented messages aren’t going to cut it; we need to appeal to an entire food, beverage and entertainment experience through our differentiated offerings. WHAT KIND OF AN IMPACT WILL SOCIAL MEDIA/MOBILE TECHNOLOGY AND THE INTERNET AND HAVE ON THE GROWTH AND DEVELOPMENT OF F&B OFFERINGS? AD: All of these are having a profound impact on F&B.

Have a bad experience in today’s market and the old adage of someone “telling” 10 others does not apply any more. A poor experience can go viral on social media platforms. On the f lip side, F&B is a door to communicating outside a casino’s four walls. Dedicating resources to social media, to respond, promote and tantalize guests with F&B offers is a smart move for casino operators. Embracing technology such as mobile with QR codes for ordering, payment apps and upgrading culinary operations with more efficient equipment are all ways to more effectively interact with our customers.

KP: The impact is already being felt throughout the industry, from timely posts of reviews of your operations – including lots of pictures — to the ability to reserve seating in your restaurants on their smartphone. As operators, we look at what can do to speed up service to guests. Technology can play a role, but you need to do your research to ensure that you are not being sold on the glitz of something shiny and new. Every property should have a social media strategy and a plan to engage the F&B operations as an important part of it. Driving cover counts through social media can have a positive impact on your gaming revenue. GVS: I see the biggest opportunity in the introduction of mobile

apps. Extending the guest’s relationship past their visit to our bricks and mortar locations, we can allow guests to continue earning and redeeming rewards, to check their point balances, and to keep up-to-date on new developments and events or have F&B offers and coupons pushed out to their devices. Staying connected with our guests allows us to keep them in the action.

WHAT GENERAL F&B TRENDS CAN CASINO OPERATORS LEVERAGE TO INCREASE TRAFFIC TO BOTH THEIR FOODSERVICE OPERATIONS AND THE GAMING FLOOR? SC: First and foremost, you have to listen to your customer.

For example, the hottest trend over the last few years has been gluten-free food and other health-related concerns. We try to be everything to everyone so we have healthier choices on our menus — organic, gluten-free, vegan options. Even though we have a steakhouse, a Chinese restaurant and an Italian restaurant with many indulgent foods, we also have listened to our customers and provide healthy options as well. 32 | Winter 2015/2016

AD: The popularity of “apps” is starting to make headway in

foodservice operations. Everything from making reservations, ordering menu items and taking payments are now commonplace in trendy restaurants. On the gaming floor, whether food and beverage leverages player windows to accomplish what apps would do, or utilizing QR codes on gaming devices to pull up menus and place orders, it is only a matter of time when this will be commonplace. Local, sustainably sourced product offerings continue to gain popularity. In our operation we have committed to purchasing 25 per cent of our food products that are local and sustainably sourced.

KP: It really depends on your property and your market. More than

ever, guests are looking for value. By this I do not mean discount, but quality products and services for their money. Creating quality F&B operations, focusing on the best products available for set price points will drive guest visits. Also, using locally sourced products, organic and small batch-made items. It is important to note that today’s consumers are more active when it comes to learning about food and beverage choices and sources which in return requires appropriate preparation and ability to address the guests’ needs.

WHICH OTHER NON-GAMING AMENITIES CAN BE COMBINED WITH F&B OPERATIONS TO CREATE A MORE SATISFYING CASINO EXPERIENCE FOR CUSTOMERS AND HOW CAN THIS BE ACCOMPLISHED? SC: Packaging seems to be creating some new opportunities. For example, we have a Yuk Yuk’s Comedy Club and even though we’ve been here for 19 years now, we’ve never really combined the dinner-show options before and we’re starting to do a little more of that. We’re also working together to do more with our spa facilities and F&B. Food and beverage is an old business while gaming is relatively young, just 20 odd years in Canada, so we’re always looking at new ways of combining entertainment, retail, spa and other non-gaming amenities with our F&B options. KP: The example we can always look to when it comes to creating

a wholesome casino experience is live entertainment. If we look at the case of Las Vegas, we can see that live entertainment has allowed casinos to increase guest visits and also attract new clientele. Live entertainment can be presented in many different ways: music, comedy, sporting events, magic, theatrical, etc. Entertainment can work well and it can also be a detriment. You must have a clear understanding of your marketplace, what is the goal of presenting particular entertainment options, how to capitalize and properly entertain guests who are experiencing the property because of that particular offering and what is the best way to utilize the venue.

GVS: We utilize free, live entertainment in most of our properties as another way to attract guests to our properties. We work very closely with our marketing team to ensure that we are focused on the kinds of bands and sporting events that our guests are expecting. They reward us based on their patronage each and every weekend. We have positioned ourselves as the place to be on the weekends as we combine compelling food and drink specials on the weekends to “peak the peak.” This approach has been a clear driver of guest satisfaction and loyalty here at PURE and we expect to continue these types of offers in the future.

THANK YOU TO OUR 2015 “CGA @ G2E” SPONSORS ANNUAL CANADIAN GAMING INDUSTRY NETWORKING EVENT

PRIMARY EVENT SPONSORS

SUPPORTING EVENT SPONSORS

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CASCADES CASINO KAMLOOPS Redefining entertainment while boosting the local economy

As part of its ambitious redevelopment strategy, Gateway Casinos and Entertainment is always looking for new opportunities to expand and share its brand of gaming, entertainment and hospitality. With its most recent opening of Cascades Casino this past summer, Gateway continues to embrace a philosophy of “entertainment redefined” with a spectacular new $40-million, first-class gaming and entertainment destination in the heart of Kamloops, British Columbia.

34 | Winter 2015/2016

CASCADES CASINO AT A GLANCE • Cascades Casino Kamloops will employ 330 people, which creates 200 new positions for people in the community. During construction, almost 200 construction jobs were created. • The 65,000-sq-ft property will offer guests more dining and other entertainment options, including three restaurants and space for live entertainment. The 30,000-sqft. gaming floor offers 500 slot machines and 18 table games. • MATCH Eatery & Public House features local gastro flare in an upscale pub format and also features a large three-season patio; Atlas Steak + Fish brings a new touch of elegance to Kamloops along with private dining, an interactive kitchen and luxurious patio seating. • Gateway Casinos and Entertainment has 12 gaming properties, over 3,500 employees, 5,500 slots machines, 200 tables, 30 restaurants and 1,000 hotel rooms.

FEATURING 65,000 square feet of premium entertainment space and a spectacular gaming floor, Cascades Casino Kamloops also includes Gateway’s signature restaurants MATCH Eatery & Public House and the debut of Atlas Steak + Fish, the new finedining restaurant. “With Cascades Casino Kamloops, we position it as entertainment redefined and our customers will experience this from the first time they come through our doors,” says Tony Santo, CEO, Gateway Casinos and Entertainment. BENEFITS COMMUNITY

Gateway has been a proud member of the Kamloops community for more than 20 years. The Cascades project helped boost the local economy during construction

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with increased purchasing and use of local suppliers and businesses. With the opening of the Cascades Casino Kamloops, an additional new 200 permanent jobs have been added with an estimated annual payroll of $7 million. Cascades Casino Kamloops is the first Gateway property to be unveiled as part of a larger redevelopment strategy to offer customers much more than just gaming. New projects are currently underway at two Gateway properties in Edmonton, Alberta: Construction of the Grand Villa Edmonton and a spectacular rebranding and redevelopment of the Palace Casino at West Edmonton Mall to become Starlight Casino Edmonton. The Grand Villa Edmonton is a new upscale casino and entertainment property in the city’s Ice District scheduled for a Summer 2016 completion that will bring up to 200 permanent jobs and a $32-million investment to the local economy. The new Starlight Casino Edmonton, slated for completion in the Fall of 2016, will completely transform the West Edmonton Mall property with a larger gaming floor, over 115,000 square feet of entertainment space, 850 slot machines and 34 table games, as well as exciting new food and beverage options, eventually bringing a $45-million investment and 300 new jobs. IMPROVED CUSTOMER EXPERIENCE

“We are undertaking an ambitious redevelopment strategy,” says Santo. “With a lasered focus on dramatically improving the customer experience, we are investing millions in our properties, growing our team and pursuing new opportunities. We think it’s critical to our success to broaden the appeal and customer base. This means investing in restaurants, entertainment and other amenities while improving the gaming experience as well. We are moving away from slot boxes and working to establish brands that improve the experience while rewarding loyalty.” The company’s redevelopment and investment plans include a brand strategy

that will see it focus on three brands – Grand Villa, Cascades and Starlight. “Each of these brands will have a number of new and exciting non-gaming amenities, like MATCH Public House & Eatery and Atlas Steak + Fish, to attract new, lapsed and current customers,” says Santo, who believes the greatest growth opportunity for Gateway resides in transitioning the gaming facilities into entertainment destinations, “because that is really what people want to do – go out and be entertained. So our challenge, as an operator, is to provide the complete entertainment package – gaming, dining, and entertainment.” REWARDS LOYALTY

Santo adds that a robust loyalty platform that rewards customers for all their preferences and purchases – not just gaming – is key to the company’s vision. “The casual gamer should be rewarded for dining at a restaurant or purchasing concert tickets. That’s how we attract a younger demographic – providing entertainment and rewarding those preferences.”

In addition to creating jobs and bringing an array of new dining and entertainment options to the local community, Santo says Gateway has worked hard with government and citizens alike to create a win-win for all involved. “Gateway strives to be a good corporate neighbor,” says Santo. “We work closely with community leaders where we operate and take their advice and guidance to heart. As a team, we very much value the feedback we receive and it is critical to our local decision-making. As well, we welcome and respect the input we get from community residents. Ultimately, we are looking to create jobs, support the local economy while creating a great entertainment destination. Working together co-operatively with governments and residents puts us on a path towards that success.” For more information on the new Cascades Casino, visit www.cascadescasinokamloops.com. For the latest news, follow Cascades Casino Kamloops on Facebook. Canadian Gaming Business | 35

marketing

NEW DOG, NEW TRICKS

Reimagining the casino experience for the Millennial audience BY OREN TAL

What can quiet, tame, senior-friendly bingo teach gaming industry executives? For Mystic Lake Casino in Prior Lake Minnesota, reinventing the wheel has enabled them to capture an unlikely bingo audience: Millennials.

36 | Winter 2015/2016

WITH A RAUCOUS, nightclub-style atmosphere, Mystic Lake hasn’t changed bingo – they’ve created an experience that’s wildly popular with their young clientele. It’s the experience that this massive cohort of consumers craves. The question is: Can your casino adapt to cash in on the Millennial market, too? THE STAGGERINGLY SOCIAL GENERATION

Millennials (born between 1980 and 1996) are now the largest generational segment of the Canadian workforce. Though they have less disposable income, Statistics Canada research indicates they’re still ready to spend what they do have. But succeeding with this generation isn’t simply about new tactics to reach them. That’s only the beginning. It’s really about adapting in out-of-the-box ways to the desires of this optimistic, social, and socially conscious generation.

marketing

We’ve compiled some questions to spark the conversation about creative and strategic evolution in your casino. 1. How can you weave social media into the casino experience?

It’s no secret: Millennials love their smartphones and social media. But in a business as regulated as gaming, facilitating social sharing can be a challenge and simply providing free access to Wi-Fi and charging ports just won’t cut it. Millennials use social media to hone their identities through self-expression but they also use it to make purchase decisions with their peers. Millennials are far more likely to set foot in your casino, or return, if they’re able to connect with you, conduct research, and discuss with others before, during, and after their visits. Are there specific locations where your casino can encourage picture-taking? How can you reward social media users for posting photos and empower them to “co-create” your brand? Could the casino floor be re-envisioned to account for smartphones? Is there a way to allow guests to vote, “like,” or comment on games and activities? 2. How can game play evolve for social gamers?

Millennials love games. Just look at the global video game industry, projected to exceed a whopping $102 billion by 2017. The question is: Can the industry leverage the components from video games and apps, (such as Candy Crush), that Millennials find so compelling? Research also indicates that Millennials want to be social. Hence, they prefer table games over slot machines – especially those that include multiple players and encourage interaction – so they can play with their friends and meet others. In addition to monetary winnings, they also want a choice of shareable, social prizes that propel the experience. How will the gaming industry evolve to include video game playing elements, facilitate interaction, or allow friends to play together? Can you challenge your suppliers and vendors to respond to the demand for social games? 3. What do you feed the grab-and-go generation?

There are opportunities to elevate the food and beverage experience beyond the traditional steakhouse and buffet to suit this generation of Instagram foodies. For Millennials, food is a vehicle of self-expression, an integral part of the “story” of their overall experience. Millennials crave food that is adventurous (think fusion foods), socially conscious (such as locally made or sustainably har vested), healthful, and of course, shareable. They’re major contributors to the rise of vegetarianism and veganism and they’re increasingly favouring organic and all-natural options. How they eat matters too. Research indicates that this on-the-go generation prefers snacking on smaller portions rather than large, sit-down meals. How c a n you r c a si no of fer I n st a g r a m-wor t hy, shareable, on-the-go portions that enhance, (but don’t

interrupt), the experience? Can you capitalize on their socially conscious appetite by offering local produce, healthy options, green packaging, or other specialt y foods that meet their diverse needs? 4. Entertainment: Can you put the audience in the show?

Millennials want interactive and immersive experiences that blur the boundaries between performer and audience. It no longer suff ices to bring in “younger” acts. This generation craves adventure – not necessarily real danger – but new experiences and adrenaline rushes. Just look at the rising trend of “escape rooms” for evidence that they prefer to get their thrills through participate over observation. How can you work entertainment into the overall casino experience, instead of keeping it separate? How can your casino create an adventure for Millennials? How can Millennials be actively and physically involved in the experience? 5. Strategic Partnerships: Can you speak to Millennial values?

A s a whole, the Millennial cohort strongly prefers socially conscious organizations. Therefore, strategic partnerships with socially responsible brands or not-forprofit organizations may be the way to attract and engage this generation. Take, for instance, Fallsview Casino’s partnership with the Niagara Sustainability Initiative. Projects like waste reduction, on-site herb gardens and energy efficient lighting are all in-line with Millennial priorities. From environmentalism to human rights, research indicates that Millennials are actually willing to pay more to do business with organizations that they feel are transparent and aligned with their values - and one way to demonstrate that is to work with and support worthy causes. How can you demonstrate social consciousness? What options can you provide to make Millennials feel like they are contributing or making a difference? What causes or groups would it make sense to partner with? Conclusion

Millennials present a large and growing opportunity for casinos. But attracting and engaging this group requires agility and creativity. These digital natives have wildly different needs and expectations than their forebears. It’s not just about changing the game; it’s about creating and delivering a new ex perience. Above all else, an experience that Millennials can share with their friends in person and online. Oren Tal is Senior Vice President and Partner at Marshall Fenn, a full-service marketing agency with extensive experience in casino marketing throughout North America. Oren can be reached at 416.962.3366 or orent@marshall-fenn.com Canadian Gaming Business | 37

executiveq&a

JOHN

DRAKE President and CEO, Casino Rama

As the new president and CEO of Casino Rama, one of Ontario’s top entertainment destinations and a key regional tourism draw, John Drake is expanding on an already impressive career in the Canadian gaming industry. STARTING OUT IN the Finance Department at Casino Rama when the property opened in 1996, Drake later moved to Casino Niagara, continuing in the Finance Department before becoming Director of Slot Operations until 2002. Next, he moved to Fallsview Casino Resort as Director of Project Development until 2005, when he became Director of Market Development. In 2007, he returned to Casino Niagara as Senior Director of Operations before coming back home to Casino Rama in 2008. Upon his return, John held the position of Vice President of Gaming Operations before moving into the role of Vice President of Marketing in 2013. Drake was born in Toronto, raised in Barrie, and now resides in Midhurst, Ontario with his family. The Drakes are strong community supporters who are involved with a variety of organizations that support local education and health initiatives. Canadian Gaming Business recently asked him about his new role at Casino Rama and his long career of leadership in the Canadian gaming industry.

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WHAT AREAS OF YOUR NEW ROLE AT CASINO RAMA DO YOU THINK WILL BE THE MOST CHALLENGING AND WHAT ARE YOU MOST LOOKING FORWARD TO ACCOMPLISHING?

First, it’s an honour to be in a leadership position within such an incredible organization, especially when I get to work with so many outstanding individuals. Changes in leadership can create challenges when they lead to uncertainly for staff and business partners. It’s important to build relationships with all stakeholders and to communicate in a timely fashion and that takes effort. It’s challenging personally to balance the need for attention at work and at home. Preparing Casino Rama to effectively compete in the ever-changing Ontario gaming market is certainly my m a i n fo c us a nd one I a m most excit ed ab out accomplishing. I plan to do this by being an engaged leader, invested in our staff and customers so that we can build a strong community together.

executiveq&a

WHAT ARE THE MOST PERSONALLY REWARDING ASPECTS OF WORKING IN A LEADERSHIP ROLE IN THE CANADIAN GAMING INDUSTRY?

I have had the privilege of working with many people in both Canada and the United States who are dedicated to seeing the North American gaming industry thrive. Their dedication is inspiring and it has taught me that the opportunity for growth and learning never ends. Specifically here in Canada, the opportunity to expand my skills into resort operations has been rewarding as our property encompasses other lines of business such as entertainment, hospitality and social responsibility. This is a dynamic working environment that is always changing and evolving. As a board member with the Canadian Gaming Association, I’m excited to be working with other leaders to help shape the future of Canadian gaming specifically in the areas of education, responsible gaming and product/service innovation. WHAT’S YOUR VISION FOR THE FUTURE OF CASINO RAMA AND ITS ROLE IN THE LOCAL COMMUNITY?

We will be working hard to continue to position Casino Rama as Canada’s leading single site employer of First Nation people. With the support and guidance of Rama First Nation and other key stakeholders within our region, we are striving to provide the proper programs like education, outreach and communication to encourage other First Nation people to join our exciting team.

well, the gaming layout significantly changed to provide better egress with wider aisles allowing a better flow for customers and also increasing the ability of those with mobility devices to access all aspects of the property. WHAT’S YOUR PHILOSOPHY FOR DELIVERING THE BEST GAMING EXPERIENCE FOR THE CUSTOMER, YOUR ORGANIZATION, GOVERNMENT STAKEHOLDERS AND THE GAMING COMMUNITY?

Customers deser ve and expect outstanding customer service. Great customer service can only be delivered by great employees, the kind who are deeply engaged with the organization. We are committed to ensuring our staff are those kind of employees. We will continue to focus on engagement initiatives that provide our staff the training to ensure best-in-class service and we will celebrate their success with them. Having an engaged workforce is essential to building customer loyalty. This customer loyalty ultimately leads to profitability and industry sustainability. This is certainly not a new concept but when done with a commitment from all key stakeholders it will ensure long-term success. As well, I believe that we all have a responsibility to our local communities and we will continue to grow our “Casino Rama Cares” program which currently supports more than 200 charitable, nonprofit and grassroots organizations each year through donations, sponsorships and employee volunteerism.

WHAT DO YOU BELIEVE ARE THE GREATEST GROWTH OPPORTUNITIES FOR GAMING IN CANADA AND WHY?

The provinces have done an excellent job at ensuring gaming is delivered in a responsible and regulated way. Because of this solid oversight there is tremendous opportunity for gaming to expand into other channels such sports wagering or online. In Ontario, as private operators take over the responsibility of day-to-day operations, they will look to expand their products and services well beyond gaming to continually bring value to customers. Therefore, gaming will truly expand to other entertainment offerings that are both land-based and mobile. WHAT ARE THE GREATEST CHALLENGES FACING THE CANADIAN GAMING INDUSTRY TODAY?

I believe product and service investment is one of the greatest challenges the industry is facing. How do we determine what future gaming products and services will appeal to a younger demographic while continuing to provide current customers with the products and services they enjoy? There are two distinct gaming experiences evolving and satisfying both simultaneously can be challenging and capital intensive. WHAT HAVE BEEN SOME OF CASINO RAMA’S MOST RECENT DEVELOPMENTS?

Casino Rama recently completed a multi-million dollar property refresh that included an upgrade of the gaming floor. Highlights included the addition of a new restaurant, the Simcoe Yard House Pub, a feature bar in the centre of the gaming floor and the relocation of the property’s main entrance to the Rotunda, providing guests a larger covered area from the elements for their comfort and upgraded valet services for their convenience. As rama_cdn_gam_bus_ad.indd 1

Canadian Gaming Business | 39 2015-08-18 9:56 AM

corporateprofile

NOVOMATIC AMERICAS

Gaming solutions and service that make a difference

40 | Winter 2015/2016

corporateprofile

Rick Meitzler, CEO and President, NOVOMATIC AMERICAS.

The NOVOMATIC Group is one of the biggest producers and operators of gaming technologies in the world with more than 23,000 employees and locations in more than 50 countries. The Group produces slot machines, electronic multiplayers and advanced systems and networking technologies as well as online gaming and lottery solutions, exporting to 80 countries. The Group also operates over 232,000 gaming machines in more than 1,500 traditional and electronic casinos as well as via rental concepts. ESTABLISHED IN 2012, NOVOMATIC AMERICAS plans to leverage the design, market research, and experience of the Austrian group’s Research and Design departments to create market specific products that are tailor-made for the North American jurisdictions. NOVOMATIC AMERICAS’ product range includes: slot machines for Class III and VLT/VGT markets, electronic table games, management systems, and ancillary services. NOVOMATIC AMERICAS offers top gaming equipment combined with exceptional support for customers in North America and the Caribbean. The main traditional markets for NOVOMATIC business activities are the Member States of the European Union; the Central, Eastern and South Eastern European markets where, due to the early market entry, NOVOMATIC was able to establish an excellent position; as well as expanding markets with exceptional growth such as the Latin American and particularly the North American markets. EXPANDS LOTTERY BUSINESS

Through the foundation of NOVOMATIC Lottery Solutions in 2013 the Group entered the lottery business segment and thus completed its transition into a truly integrated gaming concern. NOVOM ATIC L otter y Solutions customers benef it from fully agnostic retail solutions, web enabled transaction engines, state-of-the-art player, ret ail mana gement systems, and V LT solutions — together providing a never seen before level of integration with all available channels. With the acquisition and formation of a signif icant number of companies in the online and mobile segment over recent years the NOVOM ATIC Group has also established extensive competences in the mobile gaming s e g ment . T he NOVOM AT IC I nt er a c t i ve br a nch comprises a great range of companies, R&D units and

brands that focus on online products and solutions such as Greentube, Mazooma, Ex treme Live Gaming and many more. The broad range of products and solutions includes skill games, online/mobile games, social games, 3D games, online live and games as well as various other B2B and B2C products. Greentube is the leading full service provider in the online gaming and entertainment market segment and a pioneer in the development and provision of state-of-the-art gaming solutions. Central to the NOVOMATIC Interactive offering is the migration of the most successful land-based and casino games to online/mobile gaming content. We sat down with Rick Meitzler, CEO and President of NOVOMATIC AMERICAS, and asked him about the newly developed, continuously growing, subsidiary; and its relationship with the Canadian gaming industry:

Q: WHAT ARE THE MOST PERSONALLY REWARDING ASPECTS OF BEING INVOLVED IN THE CANADIAN GAMING INDUSTRY, AND WHY?

A: The most rewarding aspect of being involved with Canadian g aming is the oppor tunit y to work w ith the people within the industry. There’s a great pool of talent across the Canadian provinces that are not only extremely knowledgeable, but that are a sincere pleasure to work with. There is such gratification in working with customers and colleagues that are continuously striving to improve products and processes; a satisfaction in knowing that you are always working with a team to do things better. It’s rewarding to not only work with great people, but to learn and grow from them. Canadian Gaming Business | 41

corporateprofile Q. WHAT DO YOU SEE AS SOME OF THE BIGGEST CHALLENGES FOR THE GROWTH AND DEVELOPMENT OF NOVOMATIC AMERICAS, AND HOW DO YOU ANTICIPATE ADDRESSING SUCH CHALLENGES?

A. As we are very much the “new kid on the block,” we need to prove ourselves. We not only need to get our products onto casino floors, but we need to work closely with our casino partners to help with the success of those products. This is where the NOVOMATIC team excels – customer service. We work closely to build strong relationships with our partners; maintaining solid communication channels and always going the extra mile to give the service that is required in order to provide products in a way that is profitable for our customers.

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Q. WHAT IS YOUR VISION FOR THE FUTURE OF NOVOMATIC AND ITS ROLE IN BOTH THE CANADIAN AND GLOBAL GAMING COMMUNITY?

A : As a leader in both thought and innovation on the European continent, we at NOVOMATIC know what it takes to not only be the best, but to maintain that position. Becoming a global leader is our company’s vision, and making the leap into the North American market is a large stride towards fulfilling that goal. We want to partner with casinos across Canada and the rest of North America to receive feedback and focus on their opinions; by doing this we will not only build the products that our customers want, but most importantly the products that their players want. Innovation is the key word in the NOVOMATIC success story, a story that is based on the unique integrated market strategy as both a developer and manufacturer of state-of-the-art, highly advanced gaming technology and an operator of first class gaming services. One of the major advantages of this strategy, as both a manufacturer and an operator, is the possibility to try and test the products live in selected group operations in different markets such as casinos, electronic casinos, bingo halls and sports betting outlets as well as via online and mobile channels. Every new game development undergoes its first field test in one of these operations before it is officially released for sale. This ensures that the game design receives the essential feedback necessary for the maintenance of top quality levels and guarantees that NOVOMATIC customers can rely on the proven operational performance of the offered product. Transparent ethics and company values, innovation as a core asset of the business competence together with premium quality products and solutions are the fundamental pillars of success in the international gaming industry. Apart from the mission of offering products and services only in markets with precise regulatory frameworks, all NOVOMATIC Group companies are fully committed to offering full support to their customers in encouraging responsible gaming behavior among guests and thus ensuring player safety and security – a business conduct that is obviously of great importance for companies operating in a highly sensitive industry such as the gaming industry. For more information, visit www.novomaticamericas.com

42 | Winter 2015/2016 Untitled-3 1

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venues&amenities

WHAT’S NEW AT CANADIAN GAMING VENUES

44 | Winter 2015/2016

venues&amenities

From interactive cooking classes to complete resort m a ke o ve r s , c a s i n o a n d r acetr ack oper ator s are branching out to provide a more complete entertainment experience for Canadian customers FALLSVIEW CASINO RESORT

Chances Kelowna

W hile gaming remains at the core of its business, Fallsview Casino recog nizes that exceptional nongaming amenities continue to be an important and growing part of a diversified entertainment experience. As demographics tip into a newer generation, ref ining and expanding on non-gaming amenities becomes an increasingly essential component to the casino’s sustainability and long-term competitiveness. From private, interactive cooking cl a s s e s t o e x clu si ve C hef Ta ble e x p er ienc e s , Fa l l s v ie w C a si no’s culinar y team ser ves up unrivaled experiences for its V IP players that go beyond the traditional dining affair. New to its suite of signature ex periences, E xecutive Chef R ay mond Taylor is transfor ming f l avou r s a nd present at ion s w it h cutting-edge technolog y and molecular techniques, like liquid nitrogen, that features the very best in modernist cuisine. Furthermore, the casino is redefining the standards of presentation during hosted events with experimental quantum-levitated dishes and live-action progressive cooking stations. Fallsview Casino’s intimate 1,500seat Avalon is undergoing a number of aesthetic upgrades including new carpeting throughout the auditorium and additional renovations backstage to artist spaces. The casino presents over 250 shows a year, attracting concertgoers all of genres with its diverse roster of big-name entertainment.

The f lexibility of the theatre gives the casino an advantage to spotlight unique production shows that bring an impressive ‘wow’ to audiences such as a real ice rink, weighing in at 56,000 pounds of water, for the casino’s holiday special. Fallsview Casino’s award-winning hotel is undergoing a number of guestfacing upgrades, specifically refreshing its 374 luxury rooms and suites. The casino has invested in proven ozone technolog y as part of its EVS and Housekeeping operations, which increases eff iciencies and provides superior sanitizing and cleaning results. The Spa at Fallsview Casino is also receiving a makeover with planned renovations to the reception area that will double the capacity of seating, including a new area for small groups. Other new developments include a lash extension treatment, a line of veganbased spa products, and a software program that will enable guests to book appointments online. The Spa was recently named Top 25 Spas in Canada as part of the 2015 Canadian Spa and Wellness Awards. Fa lls v iew Ca sino is adva ncing its user-friendly, interactive digital wayfinding kiosks with a new program upgrade, which features a fresh interface and improved mapping system. The self-service touchscreen kiosks provide visitors with a quick and simple way of searching for gaming, restaurants/ lounges, entertainment, shopping, player reward program, and more. For more in for mation, v isit www.fallsviewcasinoresort.com. Canadian Gaming Business | 45

venues&amenities

WOODBINE ENTERTAINMENT GROUP

Woodbine Enter t a in ment Group (WEG) takes great pride in its efforts to make every guest experience as hospitable as possible when racing fans and guests arrive at Woodbine Racetrack, Mohawk Racetrack or any of the 53 Champions Off-Track Betting outlets across the province.

who will enjoy the thrill of live horse racing throughout the holiday season. “We’re constantly striving to exceed our customers’ expectations and our amazing Hospitality team work hard to create winning experiences for all that visit any of our outlets,” noted Soares. “Whether it’s people that have a familiarity with the excitement and

“We’re constantly striving to exceed our customers’ expectations and our amazing Hospitality team work hard to create winning experiences for all that visit any of our outlets.” — Jorge Soares, Woodbine Entertainment And, by every measure, it’s been another successful season for Jorge Soares, Senior Director of Hospitality & Off-Track Operations, and his team, highlighted by another winning Queen’s Plate event in Woodbine’s Trackside Tent this past July. Yet, with many holiday parties on the horizon, there isn’t a lot of time to ref lect on the year that’s been. Throughout Woodbine Racetrack ’s multiple dining rooms, lounges and event spaces, the Woodbine Hospitality team will cater to approximately 15,000, 46 | Winter 2015/2016

exhilaration of horse racing, or if it happens to be a corporate or social group that are enjoying our sport for the first time through one of our many event areas, we want to ensure that everyone that visits any of our properties goes home happy. It’s all about the experiences we create for our guests that help ensure they come back again.” While there are a myriad of projects, both short and long term, that require close attention, planning for Canada’s most famous horse race is always top of mind. The 2016 Queen’s Plate will

be part of a milestone Thoroughbred sea son at Woodbine, a yea r that celebrates the 60th anniversary of the Toronto oval. Not sur prisingly, planning and brainstorming sessions are already under way for the Gallop for the Guineas events that will fall under W EG’s Hospit a lit y depa r t ment ’s umbrella. “This year, we were able to once again provide a top-notch Queen’s Plate experience,” said Soares. “When people come up to our staff at the end of the day and mention they’ve already circled the calendar for next year, you feel a great sense of pride. The Plate is one of the most iconic and important sporting events in our country. We feel a great responsibility to treat that day with the respect it richly deserves.” Soares and his team take a similar approach to the many events that take place at the company’s other properties, Mohawk Racetrack and award-winning WEGZ Stadium Bar. For more in for mation, v isit www.woodbineentertainment.com. CHANCES KELOWNA

With bingo’s decline over recent years, bingo operators continue searching for the silver bullet for bingo — the “thing” that is going to revitalize the game. A fter realizing that chasing the so-called silver bullet was defeating, the team at Chances Kelowna recognized

venues&amenities

that maybe their product isn’t what needs to be revitalized; maybe it is the experience of the product that needs attention. So, they set out to focus on three areas: Flash boards: Carefully transitioning their existing players into accepting digital f lash boards. Of course, many miss the traditional flash boards, but most have begun to warm up to the new digital display of bingo. “We balanced in the changes we were implementing by transitioning our f lash boards but continuing to use a live caller,” says Kristine Jones, marketing manager for Chances Kelowna. “Throughout the renovations we not only communicated to our players, but we involved them in the process as their opinions were extremely valuable to our success. Today, we have happy players that have settled into the new look of bingo!” Marketing bingo as an entertainment option to new players for future growth. “As operators, we all know that our biggest

barrier for getting new players is the absolute intimidation they feel walking into our facility,” says Jones. “This was crucial for us to address in order to introduce bingo the millennial generation. Our solution was Funday Friday. This is a bingo session played Fridays from 9:30pm – 11pm. We teach players how to play and the jargon that comes with bingo. We use simple winning patterns, and play the odd fun group game to keep energy up. With an average crowd of 100 new players each week, players are beginning to feel comfortable enough to attend mid-week sessions. They play with friends, their moms, and we’re seeing more and more couples as well. We relentlessly put effort into this program knowing the audience is our future.” Re-focusing attention on customer service and developing relationships with players. “In many ways, what worked in

bingo 20 years ago, still works in bingo today,” says Jones. “Players still want to feel at home, they want person-toperson interactions, and they want us to be passionate about their game. It’s a full-time job to stay on top of player-experience, but worth every painstaking minute when we look out and see a hopping bingo floor.” For more information, visit www.chanceskelowna.ca.

GREAT CANADIAN GAMING — ELEMENTS CASINO

As the owner and operator of leading gaming entertainment venues such as River Rock Casino Resort and Hard Rock Casino Vancouver, Great Canadian Gaming Corporation is proud to announce that the grand opening of Elements Casino was scheduled to take place on December 17, 2015. Elements Casino will replace the existing Fraser Downs Racetrack and Casino located in Surrey, BC, one of the fastest growing cities in Canada. With the redevelopment, Elements Casino will aspire to deliver unrivaled personal ser vice, exciting live entertainment options, unsurpassed dining experiences and gaming offerings consisting of casino games and standardbred horse racing. “T h i s t y p e o f mu lt i - m i l l i o n d o l l a r p r o p e r t y transformation allows us the opportunity to ensure our guests experience something uniquely special. With our mix of gaming options, entertainment and culinary experiences, I am confident Elements Casino will be the primary entertainment choice for many,” said Michael Kim, general manager, Fraser Downs Racetrack and Casino. Elements Casino will feature more than 550 stateof-the-art interactive slot machines along with table games such as baccarat, blackjack, roulette and poker. Guests will be able to enjoy new dining options focused on prof iling fresh and modern menu styles all while experiencing live entertainment showcasing local and regional talent. In addition, Elements Casino w ill continue to offer live standardbred racing six months per year as well as year-round simulcast racing. “We look forward to the grand opening of Elements Casino as it will give us an opportunit y to elevate, improve and diversify the entertainment experience within the Surrey marketplace, a region that is currently growing and projected to be the most populated city in Metro Vancouver by 2020,” said Chuck Keeling, vice president, Stakeholder Relations and Responsible Gaming, Great Canadian Gaming Corporation. To l e a r n m o r e a b o u t E l e m e nt s C a s i n o , v i s it www.ElementsCasino.com.

Canadian Gaming Business | 47

industryspotlight

LEADERS SURVEY

Canadian Community Leaders give a resounding thumbs up on casino gaming BY LYLE HALL, MANAGING DIRECTOR, HLT ADVISORY

As casinos were proposed, planned and opened across Canada, much was written about the potential positive and negative impacts that casino gaming could have at the community level. In 2015, after a two-decade-plus history of casino operations, the Canadian Gaming Association determined the time was right to survey Community Leaders about these impacts. Ultimately the intent was to determine if, given the choice and knowing what they now know, Community Leaders would accept a casino in their community today. HLT ADVISORY was engaged to undertake the survey, which was completed through the spring of 2015. Surveys were sent to a total of 1,708 Community Leaders in eight provinces that offer full-service casinos or racinos and where the provincial lottery and gaming corporation supported the initiative. A total of 272 responses were received producing a response rate of 16%, a reasonably strong response rate for a survey of this type. SOME BACKGROUND

Full-service casino gaming (i.e., casinos offering table games and electronic gaming machines/slot machines) was introduced in Canada in 1990 at the Crystal Casino, located on the seventh floor of Winnipeg’s 48 | Winter 2015/2016

Fort Garry Hotel. The Crystal Casino was one of the first government-owned and operated casinos anywhere in the western hemisphere. Up to that point, gaming in Canada consisted of table game-only casinos or, more frequently, establishments run in conjunction with annual fairs or exhibitions (e.g., during the Calgary Stampede or the Canadian National Exhibition). T he su r vey fo c u se d on t ho se communities (including First Nation communities) with at least one full-service casino or “racino” (a racetrack offering slot machines) currently in operation. These facilities are collectively referred to as “casinos.” The survey sample included a cross

section o f C o m mu n it y L e a d e r s including elected officials (e.g., mayors, councillors, tribal officials), municipal services (e.g., fire and police chiefs), economic development practitioners (e.g., chambers of commerce, tourism marketing org anizations) as well as charities and ser vice clubs. The survey sought to gather perceptions and views of casino gambling through the lens of these Leaders’ positions in the community (as opposed to their personal opinion on gambling). GOOD CORPORATE CITIZENS: YES OR NO?

Community Leaders were asked about the role casinos (and casino managers) play within their communities. The response was overwhelmingly positive with: • 85% of Community Leaders stating that they believe the casino in their community is a good corporate citizen. • 78% believing the casino enhances the tourism appeal of the community, as well as offering a quality entertainment product (77%) and a safe environment (90%). • 77% believing the casino generates business for local suppliers of goods and services. Community Leaders agree that the introduction and operation of casinos in Canadian communities has been a success from an economic development, revenue and employment basis. Governments have

industryspotlight benefited from new tax revenues, local tourism economies have benefited from new products, jobs have been created and economic activity sparked. PROMISES VERSUS REALITY: THE POSITIVES

Communit y Leaders were almost unanimous in agreement that casinos delivered on two of the key outcomes most often mentioned in the run up to the casino development decision: creation of municipal tax revenue and employment. Employment is a key consideration for any economic development activity, strategic plan or growth strateg y. Community Leaders were positive on the employment impact of casinos in their community, noting that the jobs created were quality positions and well paid. The important role played by casinos in creating jobs was, not surprisingly, more pronounced in both smaller and First Nation communities than in larger metropolitan areas and big cities. Elected officials, as a subset of the overall sample, were pleased with the tax generation and employment created by casinos. First Nation Community Leaders were more likely to note positive impacts in tourism growth, economic development and expanded entertainment options than their non-First Nation community counterparts. This could be attributed to the generally more rural setting of these communities and the casino being instrumental in creating a tourist/entertainment draw for the community. PROMISES VERSUS REALITY: THE NEGATIVES

Prior to the introduction of casino gaming, public perception of various societal and personal difficulties associated with casino gaming included increased crime, poverty and bankruptcy, traffic, cannibalization of revenue from other entertainment businesses and problem gambling / gambling addiction disorders. Community Leaders indicated that the majority of these initial concerns did not materialize (most specifically crime and related strains on municipal services). When questioned about incremental demand on public services such as police, fire and ambulance as a result of introducing casino gaming, Community Leaders suggested no such demands were created. However, the perception of problem gambling—and the issues associated with problem gaming—continues. Further, this issue is consistent across First Nation

and non-First Nation communities as well as across both large communities and small communities. This perception requires further review however, particularly when the Canadian Partnership for Responsible Gambling has been measuring rates of problem gambling on a province-by-province basis annually since 2002 with no overall increases in problem gambling rates. THE BOTTOM LINE: WOULD YOU DO IT AGAIN?

The ultimate test of satisfaction with respect to supporting the introduction of casino gaming is, knowing now what actually occurred in a given community versus what was speculated at the time of the original decision, would casinos still be supported today? Community Leaders overwhelming said yes. When asked if a casino would be accepted or rejected today, the “yes” view outnumbered the “no” view by 3.5 to 1. Those responding “yes” encompassed a broad cross section of respondents from

coast to coast, First Nation and non-First Nation, as well as from large and small communities. Communit y Leaders are also in agreement—by a wide margin—that the introduction of casinos has been a net benefit for their community. Those viewing casinos as a positive contributor outnumber those with a negative view by 5 to 1. Only 13.1% expressed negative views towards casinos with the remaining either ambivalent or unsure. No distinct geographic location pattern emerged from the survey results (i.e., positive views outnumbered negatives views in every province, and by a significant margin). All in all, Community Leaders believe that the introduction of full-service casinos in Canadian communities has been a success. The complete report maybe viewed at the Canadian Gaming Association website www.canadiangaming.ca Canadian Gaming Business | 49

responsiblegambling

New Horizons conference returns to Vancouver in 2016 Quickly becoming a preeminent event for researchers and industry professionals in responsible gambling, the British Columbia Lottery Corporation (BCLC) is proud to once again host the New Horizons in Responsible Gambling conference in Vancouver on February 1-3, 2016. NOW ENTERING its fourth year, and considered one of the most highly regarded conferences of its kind in North America, the conference is truly a global gathering. New Horizons attracts an impressive lineup of thought leaders and industry experts, in addition to a diverse audience of researchers, industry representatives, prevention specialists, and treatment specialists. “We’re very excited to lead this year’s conference with another fantastic lineup of globally-renowned speakers,” says Jim Lightbody, President and CEO of BCLC. “Each year, we are impressed with the calibre of delegates and experts who choose to come to New Horizons. The whole purpose of this conference 50 | Winter 2015/2016

is to inspire new ideas, dialogue and collaboration while fostering different approaches and innovations when it comes to responsible gambling.” TOP MINDS COME TOGETHER

Over two days, the conference unites academics, students, and leaders to hear from industr y professionals about compelling breakthroughs in responsible gambling practices, across various disciplines. New Horizons provides an opportunity for those in the responsible gaming field to discuss and learn more about responsible gambling, problem gambling, public health, and alternatives to providing healthier approaches to gambling.

Held in the heart of downtown Vancouver, B.C., at the Vancouver Convention Centre, conference delegates also have access to a variety of tourist attractions and are encouraged to spend free time exploring the city’s sights and attractions. “I’m looking forward to welcoming delegates to our beautiful city for an extraordinary few days of innovative and insightful discussion. With just two months to go, I encourage those thinking of coming to register now, as this year’s speaker line-up and conference is not one to be missed,” says Lightbody. Early bird registration is available until November 30th – regular rates apply on December 1, 2015. For more information or to register, visit HorizonsRG.com.

responsiblegambling

SPEAKER ANNOUNCEMENTS

For the 2016 conference, New Horizons is proud to welcome an exciting new line-up of speakers, including keynote speaker Dr. Carl Hart, renowned Neuroscientist and Associate Professor of Ps ycholog y a nd Ps ychiat r y at Columbia University. Also featured is Dr. Jon Kelly, CEO of the Responsible Gambling Council, who will be discussing what he has learned over the past 20 years about responsible gambling. A total of 34 guest speakers will cover an array of responsible gambling topics including innovative thinking, technolog y and programming, and the impact to social responsibilit y and public health. New this year, speakers will also examine hot topics such as the rise of competitive video games, the skillversus-chance gambling debate of fantasy sports, and the introduction of the Positive Play Index (PPI).

EXCHANGING IDEAS

New Horizons provides a rare chance for those passionate about responsible g a mbl i n g t o come t og et her a nd make meaningful connections, while exchanging game-changing thoughts and ideas. In addition, the overall conference experience will be enhanced with new tools designed to foster engagement between delegates. For the first time, the New Horizons app will capture key presentation points, giving delegates the opportunity to revisit discussion takeaways in their daily work life. The app will also foster networking among delegates as they continue the conversation on responsible gambling. Delegates can follow along with conference updates and engage with fellow attendees by following @BCLC and using the hashtag #HorizonsRG, encouraging discussion prior to arriving in Vancouver. Socia l event s out side of the conference will also be offered to

delegates, encouraging networking with others who are passionate about the responsible gambling industry. These events unite delegates from around the world, while they take part in unique West Coast experiences. POSTER SESSIONS

The 2016 New Horizons conference will once again feature a poster session for learning and interacting one-on-one with responsible gambling researchers, project developers and students. Full-time students who present a poster will receive complimentary conference registration and compete for cash prizes. If you are interested in presenting a poster, please submit an abstract to HorizonsPoster@bclc.com by December 1st, 2015. For more details on the poster sessions, visit HorizonsRG.com. For more information, and to register for the New Horizons in Responsible Gambling Conference, please visit www.horizonsrg.com. Follow us on Twitter @BCLC.

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GAMING REGULATION What to consider when making the shift BY TERRY MCINALLY AND NAV SANDHAWALIA BUSINESSES TODAY are under constant pressure with expectations to manage more with fewer and fewer resources – this is no different for regulators in the gaming industry. Given this “more-with-less” climate, the new trend of shifting toward a riskbased regulatory compliance model has started to take hold across many industries – from banking and investment, to fisheries. The shift has now reached the gaming industry as Canadian regulators are starting to embrace the risk-based regulatory model to increase efficiencies, effectiveness of oversight, and improve regulatory outcomes. Regulators are realizing that risks can often be more effectively managed by focusing on outcomes and allowing operators autonomy when implementing efficient methods to meet regulatory requirements. Take for example, the task of keeping minors off of a casino gaming f loor. Historically, a regulator might specifically require a prescribed number of security guards at each entrance in order to comply with regulatory requirements. In the risk-based model, rather than dictating exactly how each casino should prevent minors from gaming, this approach would allow the casino operator reasonable f lexibility — whether it’s checking identification of every individual entering, adopting a blend of identification checking and facial recognition, or random identification spot checks — the regulator may subsequently be more or less rigorous with ongoing compliance activities, guided by a risk assessment of the casino operator’s chosen approach. As gaming regulators assess this approach, regulated entities need to think about how these changes will affect their business. Transitioning to a new 54 | Winter 2015/2016

or modified regulatory model is by no means an easy feat – it is without a doubt part art, and part science. MAKING THE TRANSITION

If you are a regulated entity and find yourself in a jurisdiction in which a risk-based regulatory compliance model has been implemented or is about to be implemented, consider three key points to help align your business with what is fast becoming the new normal: – Speak with your regulatory body and understand their future direction. Are they thinking of moving toward a more risk-based model? What is, or will be expected of you under the new approach? When are you expected to comply by? It can be difficult to meet requirements under a changed regime without, at least partially, discussing new/changed nuances with your regulator. A surveillance department, for instance, may want to understand the timing of reporting critical incidents vs. those non-critical incidents that can be batched and reported at intervals. A risk-based regulator may have varying processes, dependent upon the inherent risk of the incident.

Understand expectations

Embrace and adapt – These changes will undoubtedly cause a ripple effect with substantial impact on other areas of your business. Be prepared to adapt processes where necessary and continually communicate with affected staff. Managing change will need to be an important focus. For example, a change in how and which incidents are communicated for a regulated Internet gaming entity may impact an incident manager in Europe, a technical resource in Asia, and a relationship

manager in Canada. Communicating and subsequently adopting the approach properly from the outset can be cumbersome, but will also be helpful to ensure success. Evaluate opportunities for efficiency – Above all, the risk-based regulatory compliance model, when properly adhered to, ca n help st rea mline operations and present areas for improved eff iciencies. Objectively evaluating each procedure might be a hassle in the short term, but may help your business operate more effectively in the long run. If previous prescriptive requirements mandated details of your internal controls, a risk-based model may provide f lexibility to rationalize and streamline these procedures across your organization. Remain open to considering how you meet regulatory requirements; a risk-based shift might be an opportunity to revamp your approach for the better. Many gaming regulators around the world are already embracing the move toward a more risk-based compliance model; this includes the Alcohol and Gaming Commission of Ontario. Regulated entities need to understand this shift is a big undertaking, but embracing the change and realizing the many benefits it can present will help your business adapt smoothly.

Terry McInally is a Partner with Richter a n d c a n b e r e a ch e d a t t m ci n a l l y@ richter.ca. Nav Sandhawalia is a Vice Pre si d e n t w i t h R i ch t e r an d c an b e reached at nsandhawalia@richter.ca. Richter is an audit, tax, and consulting firm with a dedicated gaming industry offering focusing on supporting regulators, operators, and the broader private sector.

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