Enough already with the Millennials!

There absolutely is noobjective evidence to support the idea that there’s anything unusual about Millennials in terms of their propensity for casino gambling. None. Zilch. Zero.

Nonetheless, the sky is falling. The CEO of one of the largest slot manufacturers recently said that “in order to survive” his company is going to have to convert all their games to skill-based “Dave & Buster” style entertainments. In an investment meeting during the holiday season, the chief operating officer of one of the world’s biggest entertainment conglomerates told me that he fears casino resort investment because, “The industry hasn’t found a way to attract the Millennials and all of their money.” During the Q&A after my talk on marketing at a recent trade show, a widely-respected gaming regulator asked, “It’s clear that this is a dying industry; the Millennials are bored with casinos. What can you do to attract the younger generation?” 

The phrase “the sky is falling” is a common idiom about mistaken (and hysterical) beliefs that disaster is imminent. That syndrome of fear-mongering goes beyond the Disney Chicken Little films back to the Brothers Grimm in 1823 and before that back 25 centuries to the Jataka Tales of the Buddha. It continues today in the casino world with the panic over the generation born between 1981 and 1994; the 24-to-38-year-olds. 

My mantra has always been that this is a highly-formulaic and data-driven industry. Remarkably, despite the frenzy, there has been very little objective data analysis of the supposed problem. Let’s cure that immediately.


Who are these “Millennials” and how many of them are there? So named because they begin with the high school graduating class of 1999, the U.S. Census Bureau reports that there are 83 million Americans born between 1981 and 1994. This compares to only 76 million “Baby Boomers” (ages 58-74) born between 1944 and 1960. Interestingly, the in-between “Generation X” (39-to-57-year-olds) out number Millennials with 84-million members.


Millennials are not the largest generation; Generation X is larger. In pop culture, Millennials are often described as attention-seeking with a sense of entitlement and narcissism. They often are labeled as more diversity-tolerant, and more socially liberal relative to other demographics. More objectively, by 2020 they will be half of the work force; but earning 20 percent less than the generation before them. They also have higher unemployment than other generations and more are living with their parents than previous generations. Despite their numbers, they only make up 13 percent of the population with disposable income and assets. 


Millennials control only 13 percent of the disposable income. The majority of Millennials’ income is spent repaying debt. Americans owe more than $1.4 trillion in student loans and the majority of that debt belongs to the Millennials; the average Millennial owes $30,000 in student loans. 

Funds are limited for Millennial spending, but 60 percent of Millennials admit to spending more than $4 on coffee; 79 percent will splurge to eat at the hottest restaurant in town and 69 percent buy clothes they don’t necessarily need. In fact, a Charles Schwab study revealed that Millennials’ spending in general is vastly different from the other two generations. The chart below shows those findings, based on how many members of each generation spend in each category:

Millennials are the largest consumers of: night club spending; tattoos and piercings; snakes and other exotic pets; energy drinks; hot sauces; gas-station food; streaming media; and electronics. But, alas, not gambling. 

A gaming study by Atlantic City’s Stockton University revealed that gambling is only number 21 in the list of preferred leisure activities for Millennials; but it is number six for those over 35-years-old. Baby Boomers spend about 30 percent of their monthly budget gambling and Generation Xers spend about 23.5 percent of their budgets on gambling; meanwhile Millennials only commit 8.5 percent of their monthly budgets to gamble. 

A study by AE Wealth Management found that if money was not a concern, 50 percent of Millennials would increase spending on bars and nightclubs but not on gambling. Millennials are more open to the sharing economy; 28 percent of them cited Airbnb as important compared to 6 percent of non-Millennials. Dinner and drinks are a top entertainment choice among the late-20s/early-30s group while dancing and nightclub was the top choice among early those in their 20s. Still not gambling. 

Of the Millennials who do gamble, research shows that 40 percent who do not currently play slots would play if there was an element of skill; and 38 percent would play if they could play in a group. The same study indicated that Millennials who are also video gamers think slot machines are boring and simplistic compared to what they experience in video games. 

To further complicate the issue, the average age of Las Vegas visitors has dropped from 55 to 40 and gambling as a percentage of total Las Vegas revenue has dropped to less than 35 percent. It is true that Las 

Vegas has deliberately transformed itself from a gambling destination to a convention destination… people are now going to Las Vegas as part of their jobs; people who otherwise would likely not visit Las Vegas. And, the workforce is younger. 

Las Vegas has become a convention city of high-end nightclubs, celebrity chef restaurants, five-star hotels and very-pricey entertainment. However, Las Vegas revenue is a classic example of the “popcorn fallacy.” In that fallacy, movie theaters complain that a smaller percentage of their revenue is coming from people paying to see movies. They conclude that Netflix, cable TV and other streaming services are putting them out of business. But, factually, overall theater revenue is up; they charge more for popcorn (and other food) and hence those amenities are responsible for a larger percentage of theater revenue than movies. The fallacy is the conclusion about the source of the shift in revenue. 

One of Vegas’ most successful operators, Sheldon Adelson of Las Vegas Sands Corp., in an interview with The Economist magazine, recently claimed that he is not in the gambling business and that 70 percent of his revenue comes from non-gaming revenue centers.  


Questionable interpretation of data. Despite declarations of gaming revenue not driving the business, a review of the company’s annual report reveals that actually 79 percent of the revenue comes from gambling. More specifically, Investopedia reports: “For every dollar Las Vegas Sands takes in from room fees—and remember, the company has 7,000 rooms at one joint-property alone—it takes in $8.24 in gambling revenue. (And, dining, shopping and convention revenue combined barely match the money garnered by renting out rooms.)”

The data clearly shows that Millennials are not gambling; so that part of the concern seems to be valid. In seemingly panicked response, the casino industry has grasped at a handful of straws to “save” the industry. Unfortunately for the investors in those responses, they have proven to be less than an overnight success. The table below examines those “solutions” and results:

Seemingly in tune with the “sky is falling” evangelists—the main-stream media apparently chimed in under the headline, “Las Vegas—Is Boom Overextended?” The report began: 

“A new breed of visitor is showing up (in Vegas) … to enjoy the good rooms, food and shows but—and this is where it hurts—not to gamble. This new generation, the largest in the history of the world, clearly doesn’t have their parents’ and grandparents’ propensity for gambling. Now there is major international pop-culture media announcing that these kids are more interested in bars, music and entertainment. A generation raised in the high-tech world of gadgetry could not have the attention span to gamble like their greyed elders.”

The problem is that the above analysis came from the July 20, 1955 issue of Lifemagazine predicting that the Baby Boomer generation would be the end of gambling as a success business. 

That new Baby Boomer generation didn’t gamble; they spent all their money on sex, drugs and rock-and-roll. They had lower net-worth than their parents’ generation. They made up the largest segment of the population. They dominated consumer spending. They spent entertainment money at high-end trendy restaurants. They were driven by the short-attention-spans of the new “high tech” fad gadget—television. They sought adventure vacations and found casinos boring. 

Sound familiar?


If we look closer at the data, we realize that until 1988 the only legal gambling in the U.S. was in Las Vegas and Atlantic City; today there are 575 gaming locations in the U.S. Gambling is no longer a destination product—it now is primarily a local entertainment option. In fact, Millennials have gambled in more legal casinos than any previous generation in history. 

National player tracking data did not exist until 1997; so there was no player database prior to the Millennial generation. Consequently, there is no real data to conclude that Millennials gamble less than any other generation did at the same age.

Moreover, 100 percent of the alarmist statements about Millennial gambling propensity is not about Millennials but about age groups. Based on real data, 24-to-38-year-olds of every generation gamble less than 58-to-74-year-olds. 

So what do we know from the data?

  • There are fewer Millennials than Generation-Xers. 
  • Millennials currently have only 13 percent of the disposal income available to gamble. 
  • Casinos and games that have been targeted specifically for Millennials have failed. 
  • Millennials propensity for casino gambling is no different from the same age group 50 years ago. 

As we began, there is absolutely no objective evidence to support the idea that there is anything unusual about Millennials in terms of their propensity for casino gambling. If a casino is experiencing shortfalls in gaming revenue, objectively it has nothing to do with Millennials; more likely it is a marketing or other issue. 

Millennials don’t gamble because they are not yet in the demographic, income bracket or psychographic of casino players. When they grow into that demographic, casinos do need to be ready for them. Just as the old mechanical stepper-reel slot machines of the 1960s are boring to Baby Boomers who love big screens and bonus rounds, the current breed of games will probably be outdated by the time Millennials reach the optimal gaming age and financial capacity. Genuine opportunities may exist to expand gaming revenue with new types of games and betting; but it is incremental revenue not replacement revenue. Casinos must focus on the core demographic of gamblers; that demographic is not shrinking—it is actually increasing as Generation X and Millennials age into it. 

The “Millennial problem” isnotbased on data; it is purely imagined. There is noMillennial “problem” and the sky is notfalling.