With only 5% of casinos adopting a cashless payment model, many of which are still in beta testing, a tribal casino executive director said while predictions of 60% usage by 2025 are overambitious, there’s going to be “more and more on the gaming floors” over the next five to 10 years.
Kevin Zenishek, who works at the Northern Quest Resort & Casino in Washington state, said during a panel discussion last week at the Global Gaming Expo the way tribal casinos could have closed the adoption rate quicker was if the gaming industry had focused on cashless gaming instead of skill-based gaming over the last several years.
“For those of you who remember the millennial challenge over the last five to 10 years of building skill-based games for millennials, props to the manufacturers for stepping up and developing products to go after that market, but I think it was a miss, hindsight being 20-20,” Zenishek said. “I was a fan of the skill-based games, but looking back, the market should have been focusing on these cashless solutions. We would have had a much better opportunity to bring those younger generations into our properties if we had adopted a better cashless model.”
The adoption of digital payments by operators will reap the rewards with an increase in gross gaming revenue driven by more time on devices, a stickier customer journey, and increased visitation, supporters of cashless gaming argue.
Ron Allen, chairman of the Jamestown S’Kialiam Tribe in Washington state, said cashless is the way that people are doing business in today’s economy. When some people pay in cash, cashiers stare at them, he said.
“It’s a new industry that people are getting comfortable with but it’s a transition,” Allen said. “I know when we stopped putting the quarters in slot machines. You are changing the way you’re doing business. Cashless is the way we’re going but there are ways to transition by using two systems of cashless and cashless. It has a lot to do with the generational adjustments. The new generation is cashless. Whether it’s a casino or tribal government services, it’s a new tool to get people comfortable in using.”
Joseph Watkins, president of Worldpay Gaming Solutions at Worldpay from FIS, said it’s evident that baby boomers and older are more likely to use cash and less likely to use other types of payments. Starting at Gen X, those born between 1965 and 1980, cash starts to disappear, he added.
“The casino floor is also getting younger,” Watkins said. “A recent study shows the average age is down eight years versus pre-COVID.”
Allen said going through the pandemic, many people didn’t want to touch cash for fear COVID could spread through the paper and that has helped properties be more willing to try it.
Rich Roberts, president of Mohegan Digital, said when it comes to tribal operators, there are a lot of technological issues within casinos that have prevented widespread adoption of cashless so far.
“Being on the other side, people think they can get this done easily but most of the casinos are looking at cybersecurity and other things going on within their operations,” Roberts said. “Cashless payments are high on their list, but there’s also a lot to choose from. Will you make that decision and what’s the right opportunity for your operation? And from the Mohegan perspective, we’ve got successful casinos across the country and we just got into digital. If you’re going to make a cashless decision, you need to include digital if you’re going to maintain this 360-model.”
“Those are the challenges but also the opportunities,” Roberts added. “The question is, what’s going to be around in five to 10 years?”
“That makes a lot of sense,” Watkins said. “One of the things that tribes tend to focus on is a generational progress, so we can’t think too short-term and that this is the hot thing but instead what will work in the long term.”
Zenishek said tribal casinos owe it to the industry to be innovative and forward-thinking. He said he wasn’t around when TITO technology was released and there was a shift in the model for not using cash and the labor that comes with it.
“Whoever was behind that movement paved the way to where we’re at today, and we’re now 20-plus years down the road and looking at the next wave,” Zenishek said. “I think it’s important for us to foster the next generation of customers. There’s a lot that have grown up on mobile devices and they use PayPal, Venmo and other mobile solutions that are out there. We need to have a product that’s ready for them when they come to the market and ready to have an entertainment experience.”
Roberts said there are a lot of challenges with the app, however, and the key for the casino floor in the future is having people learn the technology. It needs to be easy for the core demo at the casinos, he said.
“We’re thinking about target-market segments and the potential future generation of on-premise brick-and-mortar gamers,” Zenishek said about what’s happening in the marketplace. “We’re competing with the digital market. Light & Wonder, Everi and IGT are creating mobile social platforms as well as tribes and other operators getting into this space. We want to have a solution for them to pay for their experience so when they come to us it’s not this hard barrier to overcome. We’re looking forward to providing that experience where they can still get out in person and still have a digital environment because the competition is getting fierce by the day.”