MMW Exclusive Q&A with Blaine Graboyes of Game Co.

Recently, MMW caught up with Blaine Graboyes, CEO of Game Co, at the Casino Marketing and Technology Conference. Here’s our exclusive chat. MMW: Tell us about Game Co. When/how did the company start? Where is it today and where do you see it tomorrow? Blaine:...

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Recently, MMW caught up with Blaine Graboyes, CEO of Game Co, at the Casino Marketing and Technology Conference. Here’s our exclusive chat.

MMW: Tell us about Game Co. When/how did the company start? Where is it today and where do you see it tomorrow?

Blaine: Game Co. is the developer and inventor of the Video Game Gambling Machine (VGM). We’re the first company that was approved by U.S. regulators for skill-based gaming. I developed the initial concept for Game Co. in early 2013, while working in the Esport space. We were bringing Esports events to casinos and we saw that the majority of our customers weren’t interested in the current slot product. We met a lot of casino executives who explained that their biggest challenge – and one of their biggest opportunities – was attracting a new/younger demographic to the casino floor. On the back of those conversations, my partners and I self-funded the business for the first two years, developed prototypes and in 2015 had our first outside funding round.

About a year to the day from our first venture funding, we were able to launch the first skill-based games with U.S. regulators in New Jersey. We’ve since expanded across other jurisdictions with games live and operating in Connecticut and will soon be live in the Caribbean, Florida, North Carolina, Oklahoma, Canada, California, and cruise lines. And, we recently opened an office in Macau and we’re getting ready to make a submission to Macau for our license and product.

We’ve also made our license application here in Nevada and will be making our hardware and software submission in the next month or two, as well as across major jurisdictions in the U.S. including Ohio, Michigan, Pennsylvania, and other tribal and commercial jurisdictions.

In addition, we have made license applications in Canada, Ontario and Alberta, and are working on partnerships across Europe, including the UK, and Netherlands as well as across Latin America.

We truly have demand from operators all over the world!

And, what we find is that the thesis is very similar across all markets. Which is, casino operators asking: “How do we start to diversify from traditional slot machines to attract a new generation of gamers and build incremental revenue for the casinos?”

We feel that gamers in-particular are a large and under-served audience that’s looking for a level of hospitality, menu of amenities, and VIP experience that’s best – and perhaps only – provided by the casino. Currently there are not a lot of products on the casino floor that appeal to those who grew up playing Xbox, PC, or PlayStation games, least of all those of us who grew up playing Atari.

We make our hardware and software platform GLI approved; this is so it can reach a majority of gaming jurisdictions. We then work with game developers to port or adapt their games to run in the casino environment. Eventually, we’d like to see dedicated areas inside casinos for gamers.

MMW: How is mobile technology influencing gaming in casinos?

Blaine: Mobile technology is influencing gaming in a number of ways. There are three jurisdictions today that support I-gaming (real money gaming) Delaware, New Jersey, Nevada, and it looks like Pennsylvania may be on the cusp.

That said; I-gaming for real money is still a relatively small revenue generator, with the biggest opportunity for its growth being around marketing; reaching new players, communicating with players and bringing them into the casino.

For Game Co. that’s the area that we are most focused on when it comes to mobile; how can we use mobile and social technology to connect with gamers, educate them, and introduce them to our products and the experience we provide. So, we bring them to casinos and create a two way communication platform where they can give us feedback on the games, and we can tell them about promotions and make them offers; generally using it as a marketing platform.

I’ve had a lot of experience in social/mobile games and I often like to use the example of creating an app. I know that I can go and buy app installs on the IOS or Android platform for $3 per install. If I find a channel that’s effective for driving installs of my app, I can spend money against it and know that I’m going to grow my app. One of the biggest challenges for Game Co. and casinos in attracting a new audience, is how are the casinos going to market and reach those customers. We think that mobile and social marketing are probably key platforms and channels for that to take place.

MMW: What is Game Co. doing to engage a mobile generation?

Blaine: We’re bringing real video games to the casino, and I believe the mobile generation is very much a gamer generation. Sixty percent of households today are gamer households and whether you’re playing on your phone or your console; if you love video games you want to play more video games.

To that end, we are very excited with our recent agreement with Bandai Namco to bring Soul Calibur to the casino on our VGM; this will be the first AAA video game available in casinos.

We’re really starting to engage a lot around marketing, finding marketing partners on mobile and social to reach existing casino customers, educate them about the product, and get them out of the nightclub/bar and restaurant and on the slot floor.

We continuously ask ourselves: “How do we reach gamers that aren’t typically visiting the casino? How can we get feedback from them on our games? How can we educate and inform them that our games are available, and provide them offers/promotions that bring them into the casino?”

MMW: How do you see mobile technology evolving within the gaming industry?

Blaine: One way is potentially more jurisdictions supporting I-Gaming, aka Real Money Gaming, that will be online and on mobile. One of the areas that we’re really interested in is what we call, “Round Tripping.” The idea that I could come to a casino, sign up with my Facebook or Twitter ID, maybe add my Xbox or PlayStation handle, and then tie that into my casino loyalty card. Now I could play a game in the casino, save my progress, follow-up with it online or on my console, and then come back to the casino a month later to pick up my game play.

My vision for Game Co. is for players to come to the casino, play our game and then get to a certain status or win in the game and then be able to promote that to their social circle on Facebook or Twitter or other social media platforms. They are also able to win some in-game items or promotions that they can then take back into the “real world”, such as a gift certificate to Starbucks, a promotional credit to promote their profile on Instagram, or a downloadable content for their favorite game on PlayStation or Xbox.

That’s something that we’re really excited about, and probably something we’ll be able to bring to market in 2018 or nearby.

MMW: What are some current challenges and opportunities in your industry?

Blaine: I would say the biggest opportunity is attracting new players to the gaming floor. Today, even if they’re at the casino for entertainment at a nightclub, bar or restaurant, they don’t have any product that is appealing to them on the floor.

Potentially, a bigger opportunity for the entire industry is gamers or tech savvy customers who don’t see products for them or aren’t necessarily interested in the casino as it is today. We can do much more to educate them about the VIP experience that’s available to them at the casino, and get new players who would never visit the casino to not only visit, but participate more actively in the overall casino experience.

The opportunity for the casino based on the lifetime value of a new gamer is considerable, while the cost of acquisition is actually very reasonable. Together with a casino, we could spend a few hundred dollars to acquire a new customer into their loyalty program, with that customer likely presenting a lifetime value of tens or even hundreds of thousands of dollars for the casino.

I would say the biggest challenge is how do we reach these customers and get them to come to the casino and sign up for the casino’s loyalty program and to return on a regular basis typically those customers are not in the loyalty program for the casino today.

MMW: What is the biggest takeaway for you having attended the conference this year?

Blaine: I think relevant to the last question; this is a marketing and technology conference for the casino industry. I would say casinos are great at running their property, hotels, food and beverage, and obviously the gaming floor. They are less active however when it comes to leveraging digital marketing and technology.

So the biggest takeaway is there are a lot of opportunities that have been pioneered in other industries, particularly around social media, quick service food and restaurants, retail and fashion, that the gaming industry can now leverage across their established processes, products, and services today that service these other industries. A great example of that, which we use at Game Co., is Influencer Marketing.

We work with a lot of Twitch personalities or professional gamers to bring them to the casino, have them be part of our marketing program, staffing them on nights and weekends so that they can communicate with customers at the casino, and post to their social media.

One of the challenges for the casinos and for Game Co. is we’re in a highly regulated industry. So while a fashion brand or quick service restaurant or technology company has fewer limits when it comes to regulation, we still have to follow gaming regulation. Whether that is live video on the casino floor, posting results of games or even photography and social media on the floor, it is very limited. So we have to work with operators and regulators to educate them about the opportunity, while at the same time working within very specific jurisdictional regulations.

MMW: Trends and/or current events that are impacting your business industry today and what it means for how you will approach the second half of 2017?

Blaine: I would say the biggest trend overall in our industry is the desire for incremental revenue through attracting new players to the casino floor. For the last two decades, probably a little bit more, the primary concern of most casinos has been what’s called, House Average — how much does each machine make on average across the casino floor.

Increasingly, casinos are focusing on a new metric – incremental revenue. In other words, how can they create new revenue through new players on the casino floor.

Game Co.’s focus is set on providing that incremental revenue for casinos and bringing them those new players. We’re currently working on a research report with one of the leading analysts in the space about defining incremental revenue and evaluating how much incremental revenue we’re generating today. We are also looking at the lifetime value of what we can create for casinos over the next five or 10 years.

I would say one of the biggest trends in the industry is what technologies and products can the casinos adopt to generate incremental revenue and attract new players. I think that leads to the question of video games; How can casinos be involved in video games, Esports, working with game publishers, cosplay, twitch channels, entertainment, all of the things to appeal to a new younger demographic?

That ties in with a current trend around skilled gaming. You have companies like Gamblit and Game Co. that are leading this effort, and you now have some of the major slot manufacturers starting to dip their toe in the water and new startups like Competition Interactive and other folks that are getting into the skill gaming space. This all ties back to what we’ve been talking about; which is marketing. How do we reach these new customers, get them onto the floor and make them a part of the casino community.

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