Multiple studies and reports have shown that Millennials are not using as much cash as previous generations.
What does this mean for the cash-heavy gaming industry? Why aren’t Millennials using as much cash? Technology has played a big part for such behavior. Apps such as Apple Pay, Venmo, and Zelle alongside online shopping have made it convenient to use electronic financial transactions instead of cash.
In current brick-and-mortar casinos, every machine or table game has to see some form of cash or physical equivalent (voucher tickets or chips/checks) to be played. On the other hand, certain online casinos have been quite profitable over the years. In such a setting, the online casino business doesn’t see a single form as a physical cash equivalent.
Does this mean that the casino industry will be completely eradicated due to cyber cash? Not necessarily. Such evidence points to the fact that people are trusting technology with their finances. This fact gives the industry the opportunity to come up with a hybrid form of cash and technology. The technology and consumer habits are ripe for experimentation.
However, this might not be as easily executable as it sounds. First, such technology has to be approved by the gaming regulators to make sure that the technology is secure for both the casino and the patron. Such approval will require time and capital before the first cyber dollar is spent on the casino floor. Second, just because it’s made doesn’t mean that it’s going to be used. Currently, the Millennial generation is not gambling as much as the older generation, and physical cash is not the primary reason. Finally, just like the resistance to the ticket in/ticket out (TITO) system, such technology might be resisted by the current patrons.
Such technology does bring its pros and its cons. The positive outlook might entail the elimination of cash exchange at a cage or ticket redemption machine. Now a guest can take their winnings immediately instead of waiting in line at the cage or ticket redemption machine. The cage can focus on other tasks that do not involve exchanging cash. Player tracking and marketing (comps) can become more efficient. Players might be able to put a cap on their spending to prevent problem gambling. Such a system can provide stricter control on underage gambling.
The hurdles that such technologies will face are the upfront setup on the players’ and the casinos’ ends. Players will have to deal with events such as the creation of a profile, linking that profile to a bank account and loading the account with money if needed. Casinos will face a physical issue to technological conversion. Current table games will require some additional technology to exchange chips, or the table game will need to become entirely technological. Slot machines will also have to be converted to use such technology. Since a casino has slot machines from a variety of manufacturers, it won’t be an easy feat to convert a casino entirely to a single cashless system.
Cryptocurrency might also play a role in the industry, but not for many years to come. The current state of society does not accept cryptocurrency for everyday transactions. However, some companies are experimenting with cryptocurrencies for the daily transaction. Companies such as Atari and Playboy have developed cryptocurrency for their patrons to use. Other companies such as LUXY and Baggy are accepting bitcoins as a form of payment. Finally, Ducatus Café, an establishment in Singapore, only takes their form of cryptocurrency as payments, making it genuinely cashless. Regardless of the acceptance speed by society, cryptocurrency will need to go through a lot of hurdles before it makes its presence on the casino floor.
What does this mean for companies that solely focus on selling bill acceptors and ticket printers? These companies have to accept that it is a possibility that their product might become obsolete in the future. However, time is in their favor to come up with a plan in case such events happen.
In the end, converting a casino into a cashless enterprise will be a tough accomplishment and most certainly a time consuming one. However, the time is right to experiment and see if such a model will pay dividends in the future by slowly introducing it to the right consumer. A consumer that trusts technology and gambles.