You have likely heard the buzz about retail media in other industries. Ad platforms have moved from four basic channels on your black-and-white television, radio, print and billboards to virtually anything we as consumers may experience. Amazon, Walmart, and others are turning their environments into platforms for delivering messages that don’t always turn into retail sales revenue for them.
Retail media, the practice of advertising or promoting products within a retail environment, has experienced explosive growth across various sectors. It is a win-win solution for both advertisers, who gain access to captive audiences, and the platforms hosting the ads, who unlock new revenue streams.
You might be wondering how it applies to your casino. In our case, that environment is your casino floor and is ripe with potential. Moreover, the key drivers leading to this growth mirror the needs and opportunities for casinos.
- New Revenue Sources: In an increasingly competitive market, retailers must diversify their income streams. Advertising provides that.
- Brand Growth Challenges: Advertisers are constantly seeking new ways to reach consumers, and like retail environments, your casino floor offers a captive audience.
- Decline of Third-Party Cookies: As digital privacy concerns grow, first-party data (which you already collect) becomes increasingly valuable.
- Evolving Consumer Behavior: Consumers (and likewise players) are more receptive to personalized experiences, including relevant advertising.
The numbers speak for themselves. GroupM forecasts retail media spending to hit $160 billion by 2027. While this projection covers all industries, even a tiny slice of this pie could significantly boost your bottom line.
As casino operators, we have unique advantages that make us ideally positioned to leverage retail media:
- Captive Audience: Casino guests often spend hours in our environment, unlike traditional retail.
- Diverse Demographics: We cater to a wide range of customers, offering rich targeting opportunities for advertisers.
- Data Goldmine: Our player tracking systems and loyalty programs provide invaluable insights.
So, the million-dollar question is: How can casinos leverage retail media to enhance operations and create new revenue streams?
The potential gains are substantial. By pioneering this approach, you are not just opening a new income source but also enhancing customer engagement and potentially increasing player retention.
The Casino as a Retail Environment:
At first glance, the similarities between a bustling grocery store and your casino floor might not be obvious. But look closer: both environments offer a captive audience, opportunities for impulse purchases, and the ability to collect valuable customer data.
Your casino floor is already equipped with the necessary infrastructure, uniquely positioning you to harness the power of retail media. Traditionally used for internal promotions, these assets are prime real estate for a retail media revolution.
- Video Screens: From the displays on your slot machines to the large screens in your sports book, you have multiple touchpoints for digital advertising.
- Digital Signage: Are those screens promoting your latest jackpot or upcoming entertainment? They are also prime real estate for retail media.
- Player Tracking Systems: The backbone of personalized marketing in casinos can be leveraged for targeted ad delivery.
The key is to reimagine these assets as potential advertising channels. Here are some retail media formats that translate well to the casino environment:
- On-Screen Ads: Short, eye-catching promotions displayed on slot machine screens during idle times or as players cash out.
- Sponsored Content: Branded entertainment or informational content on your larger displays.
- Personalized Offers: Tailored promotions sent to players’ mobile devices based on gaming preferences and locations.
While we need to be mindful of regulations and player experience, there is no reason we cannot adapt successful retail media strategies from other industries. A major retailer increased sales by utilizing in-store screens. Imagine achieving similar results with restaurant recommendations or show tickets in your casino.
How Casinos Are Already Using Retail Media (But Could Do More)
You might be thinking, “We already advertise on our screens.” And you’re right! Most casinos use digital signage to promote internal offerings like upcoming shows, restaurant specials, and new slot machine arrivals. While this is a good start, it barely scratches the surface of retail media’s potential.
Casinos that solely focus on internal promotions are leaving money on the table. An untapped opportunity exists to monetize these assets through external partnerships and more sophisticated targeting techniques.
Unlocking New Revenue Streams with Retail Media
Here’s where things get exciting for casino operators like you. By fully embracing retail media, you can:
- Monetize Your Digital Real Estate: Instead of solely promoting internal offerings, sell ad space to complementary businesses like local restaurants, tourist attractions, or (perhaps even) non-competing casinos in other markets.
- Leverage First-Party Data: Utilize your player’s club data to offer highly targeted advertising opportunities, attracting premium brands willing to pay for access to specific customer segments. For example, a luxury watch brand might pay a premium to advertise to particular segments.
- Adapt to Privacy Changes: As third-party cookies phase out, your first-party data becomes even more valuable. You’re in a prime position to offer advertisers the targeted reach they are losing in other digital channels.
By implementing a robust retail media strategy, a casino your size could potentially generate hundreds of thousands in additional annual revenue. And that’s just the direct ad revenue – we haven’t even touched on the potential for increased player engagement and spending.
Building Your Casino’s Retail Media Strategy: A Roadmap
The potential of retail media in the casino industry is clear, but where do you begin? This roadmap will guide you through the essential steps to create a successful retail media program for your casino.
Step 1: Assessing Your Assets
The first step is to take a comprehensive inventory of your existing digital assets and evaluate their potential as advertising channels. Here’s how those assets can be practically utilized:
- Slot Machine Screens: These are your bread and butter. Modern machines often have idle animations – why not replace these with targeted ads? These can be used for dynamic, targeted ads during natural pauses in gameplay, such as between spins or while players are cashing out. Take note this may require cooperation from suppliers.
- Digital Signage: From wayfinding displays to digital screens advertising your next giveaway, these screens can pull double duty as ad space. Large-format screens throughout the casino, including those in high-traffic areas like the lobby, restaurants, and bars, can display various ad content, from static images and videos to interactive promotions.
- Interactive Kiosks: Player’s club kiosks can offer personalized ads, point balances, and promotions. Integrate advertisements seamlessly into player’s club kiosks or other interactive stations, providing additional touchpoints for guests to engage with promotions and offers.
- Mobile Integration: Your casino app is prime real estate for personalized offers. Create a seamless omnichannel experience by syncing digital screen ads with your mobile app. This allows for customized offers and deeper engagement with guests, even after they’ve left the casino floor.
Pro Tip: Consider partnering with a technology provider specializing in casino digital signage. They can help you maximize your existing infrastructure, suggest cost-effective upgrades, and provide the expertise needed to launch a successful retail media program.
Step 2: Harnessing the Power of Your Data
As a casino operator, you already possess a wealth of valuable customer data. This data is the key to unlocking the full potential of retail media. You can gain valuable insights into guest behavior, preferences, and spending habits by leveraging your existing player-tracking systems, loyalty programs, and other data sources.
This data can then be used to create highly targeted audience segments, allowing you to deliver the right message to the right person at the right time. For example, you could target high rollers with ads for luxury goods or tailor promotions to specific demographics based on age, gender, or location.
In addition to existing data, consider implementing additional data collection methods, such as Wi-Fi analytics or beacon technology, to understand guest movement patterns and further refine your targeting strategies.
Step 3: Crafting Compelling Content
Content is king. Gaming manufacturers understand this. The lights and sounds of a casino make for a highly stimulating environment. This new retail media content must be eye-catching and engaging to compete with everything vying for attention. Here are some tips for creating compelling content:
- Create Eye-Catching Visuals: Use high-quality images, videos, and animations to capture attention and convey your message quickly.
- Tailor Content to Placement: The content displayed on a slot machine screen should differ from what is shown on a giant digital billboard. Consider the size, viewing distance, and context of each placement.
- Explore Partnerships: Partner with internal and external brands to create co-branded campaigns that benefit both parties. For example, a restaurant could sponsor a slot machine tournament, with ads for the restaurant displayed on the screens.
- Experiment with Interactive Content: Incorporate touchscreen elements, QR codes, or other interactive features to encourage guest engagement and drive action.
Step 4: Implementing and Optimizing Your Retail Media Program
You’ll need a robust platform or partner to handle ad delivery, targeting, and performance tracking to launch and manage your retail media program successfully. Look for a solution that integrates seamlessly with your existing casino systems, allowing you to manage campaigns and track results easily.
Start small with a pilot program in one area of your casino, such as the slots area or a specific restaurant. Use this opportunity to test different ad formats, targeting strategies, and content types. You can refine your approach and gradually expand the program to other casino areas based on the results.
Continuously monitor and analyze campaign performance to identify what’s working and what’s not. Use this data to optimize your campaigns and improve your results over time.
Overcoming Challenges and Staying Ahead of the Curve
As with any emerging technology, implementing retail media in casinos comes with its own set of challenges. However, by proactively addressing these issues, you can ensure a smooth transition and maximize the potential of this new revenue stream.
Fragmentation: With ads potentially running across various systems (slot machines, digital signage, mobile apps), ensuring a cohesive and consistent experience for guests can be complex. To overcome this, explore and invest in a centralized ad management platform that allows you to streamline content distribution across all your channels, ensuring a unified brand message and a seamless guest experience.
Measurement and Attribution: One of the biggest challenges in retail media is accurately measuring the impact of advertising on revenue and other key performance indicators. This can be particularly complex in a casino environment due to the multitude of factors influencing guest behavior. To address this, implement a robust tracking system that connects ad exposures to actual spending in gaming and non-gaming areas. This might involve using player card data or other tracking technologies to create a comprehensive view of the customer journey.
Avoiding Saturation: While the goal is to maximize ad revenue, it is crucial to balance monetization and guest experience. Too many or irrelevant ads can annoy guests and detract from their overall experience. To avoid saturation, use data-driven insights to optimize ad frequency and relevance. Consider implementing frequency capping to limit the number of times a guest sees the same ad and use targeting to ensure that ads are relevant to the individual guest’s interests and preferences.
Balancing Monetization and Guest Experience: This is perhaps the most critical challenge. The key is to prioritize the guest experience above all else. Ads should be seen as a natural and welcome part of the casino environment, not an intrusion. This means carefully selecting ad partners that align with your brand values, ensuring that (as mentioned previously) ad content is relevant and engaging, and using data to personalize the experience for each guest.
Regulatory Compliance: The casino industry is highly regulated, and advertising is no exception. It’s essential to work closely with your legal team to ensure that all ads comply with local and federal regulations, including those related to responsible gaming and advertising to vulnerable populations. Additionally, venturing into retail media may bring you into contact with regulatory bodies like the FCC that you have not traditionally dealt with. Staying informed and proactive in your compliance efforts is crucial.
Staying Ahead of the Curve
To play a role and succeed in the retail media revolution, casinos must stay ahead by embracing emerging technologies and trends, including the following.
- Programmatic Advertising: This technology allows for real-time bidding on ad space based on who’s on your casino floor at that moment, maximizing the relevance and effectiveness of your campaigns.
- AI-Powered Personalization: By leveraging machine learning algorithms, you can analyze guest data to predict which ads resonate most with each individual, delivering a truly personalized experience.
- Augmented Reality (AR): Explore the potential of AR to create immersive and interactive ad experiences. For example, allow guests to “try on” virtual jewelry from a retail shop or view a 3D menu from your steakhouse.
By embracing these innovations, you can maximize your retail media revenue and create a cutting-edge guest experience that sets your casino apart from the competition.
The Future of Casinos is Retail Media
The retail media revolution can potentially transform the notion of casino revenue. Now is the time for casino operators to seize this early-adopter advantage and become leaders in this emerging field. By taking a proactive and strategic approach to retail media, you can position your casino for continued growth and success in the years to come.
The potential benefits are clear:
- Diversified Revenue Streams: Reduce reliance on traditional revenue by tapping into advertising dollars.
- Enhanced Guest Experiences: Deliver relevant, personalized content that adds value to the guest experience.
- Increased Appeal to Advertisers: Attract premium brands seeking access to your engaged audience.
- Better Utilization of Digital Assets: Maximize the value of your existing digital infrastructure.
For those of you who’ve attended my Casino Marketing Boot Camp, you know I’m a strong advocate for actionable strategies. So, here’s your call to action: Start small, but start now. Conduct an audit of your digital assets this week. Reach out to potential technology partners. Most importantly, begin thinking of your casino floor as a gaming space and a valuable media platform.
The retail media revolution is here, poised to transform the casino industry. Those who move quickly stand to gain a significant competitive advantage. Will your casino be one of them?
Thank you Julia for authoring this excellent article on retail media. You provide a roadmap for “brick-and-mortar” land-based casinos to create a new revenue stream by monetizing their digital assets with the sale of contextual programmatic advertising on their proprietary, “walled garden” private marketplace of digital media.
Brand messages and offers can take the form of native, display, video, CTV, audio, in-game, and DOOH ads that will create personalized casino patron experiences, diversify revenue, and improve profitability for casino operators.