A key to casino growth going forward is to attract more patronage and play from the Millennial generation, and the best way to accomplish this task is for land-based properties to embrace entertain-oriented amenities and various forms of skill-based games, said Kevin Smith, president and CEO of Boyd Gaming during his keynote presentation at the Southern Gaming Summit, which took place this week at the Mississippi Coast Coliseum and Convention Center in Biloxi, Miss.
Currently, the U.S. casino industry relies largely on the Baby Boomer generation for the lion’s share of casino visitation and revenue. Unfortunately, the Baby Boomer population is waning, and the group quickly rising to replace it in terms of affluence and influence are the Millennials, loosely defined as people born from 1980 to 2000.
“Baby Boomers have been our foundation for some time and that will not be changing anytime soon,” Smith said. “There are more than 75 million Baby Boomer sin America today and they are on the verge of becoming the largest generation of retirees in this nation’s history. But Baby Boomers will not be our core customers forever. Behind them are the core customers of tomorrow… the Millennials, which, believe it or not, are even bigger, accounting for more than 80 million Americans. This generation does not rival the spending power of boomers today, but they are about to enter their prime spending years, their economic clout is growing and, eventually, they will be the beneficiaries of the largest generational wealth transfer in history…some $30 trillion in inheritances, by some estimates.”
The problem is that gaming facilities designed to appeal to Baby Boomers often leave Millennials cold. The trick, according to Smith, is to create experiences that will appeal to Millennials but not alienate older generations. One solution to this problem—add more skill-based betting options, such as table games.
“Will the casino floor of tomorrow resemble what we offer today, dominated by the slot machine?” asked Smith. “It may not. One thing that has caught me by surprise is that in recent years Millennials have had a growing affinity for table games… we are adding table games to the casino floor because it is the part of the casino floor where we are seeing consistent growth, and that is being driven by increasing demand from the Millennials. Millennials socialize differently than generations before….and they prefer environments that drive social engagement. On the casino floor, this drives Millennials to games like blackjack, craps roulette.
“There is an opportunity for slots as well. This is a generation raised on video games. Making slot machines look and feel like popular video and social games is an obvious opportunity that manufacturers are starting to explore. Speaking as an operator, we would welcome a greater selection of Millennial-friendly titles to the slot floor.”
Mobile gaming and sports wagering also appear to have greater appeal among today’s nascent gamblers, according to Smith.
“I believe we are only scratching the surface with the social gaming experience,” Smith said. “As we try to connect to this generation…we have to think of entirely new ways to deliver our products. One example is mobile gaming, In Nevada, most operators now provide sports wagering through proprietary mobile apps, allowing customer to place wagers from anywhere in the state. In New Jersey, we deliver poker and traditional video games through a variety of digital platforms including smartphones and tablets. These are strategically important because it is a way to connect with a new generation of customers. Millennials are an online generation.”
The Millennial generation is also much more social aware and active than Baby Boomers, so casino resorts will need to incorporate more non-gaming amenities such as nightclubs and restaurants into the entertainment mix to keep them happy and visiting.
“Consumers….want more attractive non-gaming amenities, and we are responding,” Smith said. “It’s not surprising that the most successful properties in Biloxi are the Beau Rivage and IP, the two properties with the widest range of first class gaming amenities. It’s no accident that the most successful regional properties across the country are those with the broadest selection of non-gaming amenities. Making the shift toward a diversified entertainment product with a broad selection of non-gaming amenities is essential to the long term competitiveness of regional casinos, especially as we look to expand the reach to Millennials.”
However, should not lose site that the casino, at least in Boyd Gaming’s experience, is still the driver of the modern gaming resort.
“Casino gaming remains solidly at the core of our business in every market we operate,” Smith said. “That will not change in the years to come.”