Gambit on Bingo evening London gathering beating Cheltenham?

SENIOR GAMING PROFESSIONALS TACKLED ISSUES RELATED TO the online Bingo Phenomenon AT THE March 2007 GAMBIT GAMING FORUM

GAMBIT MEETING March FORUM RECAP
VENUE: CASS BUSINESS SCHOOL, LONDON - 13 March 2008

The impressive panel above (left to right), Phil Fraser (Which Bingo ), Leigh Nissim (St. Minver), Gareth Wong (Gambit & GamBond® Founder) and Simon Collins (Cashcade Co- Founder).

-Report Prepared by, and evening moderated by GamBond® founder Gareth Wong.

Strong wind cancelled the Cheltenham races the day before, and Gambit on Bingo may have diverted quite a few senior gaming executives from the Cheltenham race on the 13th March 2008.

Indeed, heads of bingo of some major brands from Butlin, Virgin Games, SkyBet, FoxyBingo, Jackpotbingo, Bingo.com and many more converged at the Cass Business School to discuss the phenomenal trends of online Bingo.

Our previous confirmed speaker of Matt Campion from Endemol gaming had to pull out last minute due to some other commercial pressure, but thankfully, Phil Fraser, founder of Which Bingo, who had been proponent of online bingo from day one managed to stand-in.

The evening's formal proceedings started with Phil Fraser sharing some important statistics, (namely, 3.36million offline bingo users and only 576,000 online users based on extrapolation of the prevalent study, which the online bingo population has apparently grown 71% last year alone).

He also analysed the market by looking at "spread of number of online bingo sites", then, the "bingo networks" (enabler of online bingo sites that shared traffic) were mainly dominated by a few, namely 888.com/Cassava (previously known as Acquagaming), Parlay (enabler of St. Minver) and Virtue Fusion. However, Virtue fusion may have more of the major brands like Mecca etc. on their network.

He highlighted that as time goes by, there are more household brands joining the market and the fact that it is still in its nascent phase where the growth in the near/medium future seems endless.

Looking in the future, Phil commented on the power of potential converged routes to market (e.g. internet, Land and iTV), but he was not certain of the potential success of mobile Bingo.

(Gareth Wong comments [GW]: to gain some real transparency, what the market really need is which networks has the highest amount of revenue or players. The market do need a service which tap into all online bingo sites to see how many 'active' players are there and see how they are distributed across different brands/networks [maybe like poker pulse for the poker market]. Only then will we have an idea of how well one brand or network is doing compare to others!)

We then have Leigh Nissim, Managing Director of St.Minver, key online bingo networkfor "household brands", explained the reason why some major high street brands would consider and indeed taken the plunge, and moved into the online bingo world.

He also highlighted the fact that the present online bingo players are indeed NOT cannibalising the existing users but in fact supplementing the existing user base for them to engage in the service for various reasons, e.g. they can smoke and play bingo at home, or play whilst the offline clubs are closed or not yet opened.

Based on their proprietary research, he shared with us the traits of low and high depositors, the demographics and what they read and their education levels etc. It showed that their driver to play maybe slightly different but so far, it is mainly consisted of female.

Key findings that would encourage the brand owners to move into online bingo is that the top three reasons for choosing one site over another is 'trust', "ease of deposit and withdraw" and "customer service". These tend to address another key concerns where users 'prefer' not to disclose their card details, guess with trusted brands, this would be ok.

Due to popularity of the bingo format, loyalty of the present user base seems to be called in question, as the number of offers and promotions increased, there is now a breed of 'bingo tart' (exact wordings used), where they have multiple accounts. Their custom is swayed between various brands depending on the 'best deals' available.

Therefore, basis of competition for these online bingo users seems to be on the best promotional offer/bonuses and competitions or best prizes, etc.

Because of the networking effect, online bingo sites can also launch/enable some major prizes across the network, which would entice traffic, hence business. A good example of a brand moving in from the offline world was Butlin Bingo, which amount of online bingo revenue is not comparable to their offline business, they in fact use online bingo as a customer acquisition tool. This maybe a better or realistic way for major brands to utilise online-bingo, which is to reach the audience that the brand does not usually reach. It has since successfully use the bingo products to promote and cross-sell other products into this new customer base.

Leigh argued these are some of the reasons why some forward thinking major household brands are keen and have already moved into online bingo. He would go as far to say a major institution/high street brand will launch in 12 months time.

We then had a good friend of mine, Simon Collins took the floor. He is co-founder of Cascade over 7 years ago. I met him back in 2003 and had a white label site from him then using the Getminted softgaming backend. However, in the last few years, their focus has since been moving towards the online bingo format, which has really taken the market like a storm and now brings in 75% of their income.

Simon shared with us some numbers and his proprietary market study of 1472 UK consumers, showing that online bingo is slightly ahead of poker and sportsbetting in UK. Like St.Minver, Cashcade also provide managed service for media/brand owner (eg. The Mirror, Scottish Television), but of late, they have spent a lot of resources in building up their own brand of FoxyBingo.

Based on Simon's proprietary research, he also found that Incentives (money offer/bonus) and fun seem to be the key reasons for users to start playing.

However, being counter intuitive, in fact, FoxyBingo has gone the brand route and spent money in promoting the brand itself and in fact DO NOT offer as much incentives for users.

This might be the best strategy for Cashcade as their brand recall is as strong as Gala, Mecca, Sun and Ladbrokes!

Its not surprising for us that CashCade's lastest TV advertising campaign is spending £500,000.0 on the making of the TV advert with several thousands 'extras' and will spend another £7million pounds in buying TV slots in the coming months.

They also found a phenomenon where every-time the TV, newspaper and online campaign is carried out, the search engine optimisation (SEO) ranking of FoxyBingo conversion increased dramatically.

They see similar results on the affiliate portal's conversion… despite their advert placement is bad on certain portals.

We can also observe some 'viral' usage of the 'making of FoxyBingo advert' which seems to have a good traction on likes of YouTube, which the audience also enjoyed.

The floor was then opened to a general Q&A discussion. In fact, this is the 'meat on the bone' which most loyal Gambit members are looking for. As I hosted the gloves off discussion of key industry leaders, speakers and attendees alike.

Q&A:

Initially focused on why the audience think mobile adoption would be limited, we had a good discussion and contribution from Richard Marshall of Rapid Mobile and Ray de Silva of Vodafone.

Katlina Chin of Butlin Bingo suggested that it is not plain sailing even for brands that are already operating in the online Bingo site, as they constantly need to review the pros and cons of business vs. potential reputation-al risks.

John Hegarty, Vice Chairman of Communication Manager's Association asked whether likes of Tesco could be a good candidate to leverage their brand for online bingo. The audience and speakers all agree that likes of Tesco or other household brand could really 'clean' the floor should they decide to move into this market.

We then explored the 'responsible gaming' aspect of the sector, some are really proactive and employ pre-determined maximum deposit per user, some are more 'enabling' to enable users to set for themselves the 'maximum deposit' per week/months etc. Most feedback was that due to the low stake nature of the game and the target audience, problem gambling don't seem to be a major issue at all for the sector.

The question of whether initial investment of marketing of the 'online bingo' category maybe wasted as major high street brands might swoop in and take over. The audience consensus was that this is not likely to happen due to the huge market growth potential of the market as a whole.

Cost per acquisitions of various channels were also discussed, and whether the promotional investment would in fact increase the cost for everyone, it would seem like the brands would focus effort in different channels and acquire based on their company's customer preferences.

We then had a fantastic networking session with the audience, and then moved onto a local pub until it was closed at Midnight.

Many thanks for St.Minver to sponsor the drinks for the evening, And GamBond® as the evening Sponsor and Cass Business School for hosting the function.

Before event Networking:

FurtherNetworking photos below:

• Speakers on the night:

  Simon Collins, Co-founder Cashcade/Foxy Bingo , - talk about Foxy bingo and their new TV campaign, Download Simon's presentation here.

  Leigh Nissim, Managing director, St. Minver , - Why Brands want to get into Bingo - who the players are? - What are the key for success and sharing some key numbers, Download Leigh's presentation here.

  Phil Fraser, WhichBingo, - The Market, Download Phil's presentation here.

  The above event was sponsored by:

  

  Drinks Sponsored by:

  

  Gambit-Special Event media partners:

promotional partner:

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