If the major professional sports leagues are getting behind esports, the casino industry should recognize the opportunity to profit from the association, said a panel of esports experts Monday at a conference that caters to Native American tribes.
The discussion took place on the same day the National Football League announced a partnership with Epic Games for players of “Fortnite” to get NFL team outfits in the online game’s Battle Royale item shop starting Friday.
During the 19th annual TribalNet conference at the Hard Rock Hotel & Casino in Las Vegas, the panel session looked at the ability of esports to profit inside casinos, an idea that has been met with skepticism by some in the industry.
The naysayers are concerned esports enthusiasts won’t play casino games, are concerned about the integrity of betting on esports, and fear alienating older casino customers.
However, there are casinos hosting esports tournaments and conferences and opening lounges where customers can play esports.
Ari Fox, co-founder and CEO of Fox Marketing, said the National Football League, National Basketball Association and Major League Baseball are already investing in esports.
Added Fox, whose company host esports conferences and video gaming festivals in casinos called Gameacon, added, “They’re buying esports teams and putting skin in the game. They’re integrating themselves with this generation. If you can start doing that, you’re going to be around for a very long time.”
Fox and his brother Ben touted the growth potential of betting on esports competitions that is popular around the world as a $1-billion-plus industry but has limited offerings in the U.S. Love streaming the events and statistics on players – like horse racing – will help betting grow.
“The first integration I see between casinos and esports is a (video) game like Madden (NFL) or NHL or game like MLB or NBA 2K tournament,” Ari Fox said. “These are games that the older crowd will understand because it’s something they’ve been watching live in real life.”
Zachary Atherton-Ely, associate general counsel for the Millie Lacs Band of Ojibwe in Minnesota, said esports betting will follow the path of sports betting expansion. He said there is potential for profit, especially for in-game wagering.
The Fox brothers said integrity measures are in place to prevent hacking of systems and cheating. However, there were 32 cases of cheating in 2017, half by Chinese and Russian players, as monitored by an international integrity organization, Ari Fox added.
“Because we haven’t brought esports betting into a regulated market, we don’t have a regulatory agency and sign off on it,” Atherton-Ely said. “As this grows, you will see minimum control standards by either tribal or state regulatory agency.”
But how do casinos market to those interested in esports without alienating existing customers?
The challenge from a casino perspective is that the typical client in their market is 64 years old and a woman, Atherton-Ely, said. Esports players are substantially younger and commuting with them risks angering and putting off their core clientele.
Ari Fox said properties should never ignore core customers, but they shouldn’t stop trying to bring in younger ones.
“We’re saying you need that core as your bread and butter, but that core is going to go away eventually,” Ari Fox said. “They will be too old to come to your place. You have to have something new. Introducing a new community and younger generation to come to your casino is vital if you want to be here.”
He likened it to casinos adding nightclubs to attract a younger generation.
Atherton-Ely said achieving crossover from esports to slot machine play has been difficult. There’s movement by manufacturers, but it hasn’t worked yet. Table games are easier for esports players because the skill component is up front, he said.
“I wouldn’t go into it thinking every esports players is going to become a traditional gambler,” Atherton-Ely said. “You just don’t flip a switch. You get them in and grow them with your brand and feel a part of the community. Then they sit down at a blackjack table and maybe find a slot machine that appeals to them and dine at your restaurants. I don’t see it as the goose that lays the golden egg. I see it as another offering is a good way to describe it.”
Ben Fox said gamers play skill-based games that can be monetized. The skill-based games in the market are in their infancy. He said the one advantage for casinos is the younger generation isn’t expecting as much as a payout because they enjoy the fun of the game.
“I think it’s coming along, but the biggest obstacle is getting the gamer comfortable with that skill-based games,” Ben Fox. “They’re just not up to speed yet for a gamer. Does that mean they won’t make a big part of the casino floor? No. It just means they have to become more sophisticated, and manufacturers need more help from the casino community to make them better for gamers. Whatever the gamers are playing, take that and run with it.”
Ben Fox said casinos should be patient because the market is there. There’s no need for infrastructure, expect an esports lounge. Invest in the community, and that will pay itself back, he said.
Atherton-Ely warned casinos, however, “you can’t flip a switch and thousands of people are going to show up at your property” and that they’re all going to play slots.
“That’s an unreasonable expectation, but I do think there’s an opportunity there to communicate with this new clientele thoughtfully that doesn’t alienate your traditional patron.”
