Does your gaming floor match up?

People talking

Have you ever wondered whether you’ve got the right mix of gaming machines or are investing enough in gaming staff to deliver a quality service? While the winning formula in each club is likely to be unique, it is beneficial to understand how you measure up to industry benchmarks – especially if you’re in New South Wales.

Daniel Mitchell

Chances are you’ve heard the terms ‘business intelligence’ and ‘big data’ being bandied about, and for good reason – there is a wealth of research that shows that data-driven decision-making improves business outcomes.

All the buzzwords and jargon thrown around by consultants may be intimidating, but there are simple approaches to data analysis that can often yield important insights.

The Astute Quarterly Industry Benchmarks report – based on the New South Wales (NSW) market – is a classic example of a simple but effective approach. It’s a relatively easy process to compare a venue’s performance with industry benchmarks to determine how it is tracking relative to its peers.

The APDM indicator

By far and away the most common benchmark used in gaming machine performance monitoring is average daily profit per machine (ADPM). The overall ADPM figure across all clubs was $155 for the last gaming machine tax year (the year ended 31 August 2017). A more in-depth dive shows significant variances across venues, with more than two-thirds making an average profit per machine of less than $100 per day.

Astute provides the ADPM figures on an aggregated basis across a range of categories including venue size and gaming machine manufacturer and denomination – allowing the venue to zero in on and identify specific areas of under or over performance on the gaming revenue front.

It’s important to remember that, despite the terminology, ADPM is really a revenue rather than a profit figure and therefore represents the contribution to the club’s bottom line. That’s why it is necessary to take benchmarking a step further and compare performance not just for revenue but also for the cost and profit domains.

Some costs need to be accounted for, not the least of which is gaming machine tax. Approximately, 20 percent of the ADPM goes straight into NSW Treasury’s coffers.

Why benchmarking matters

Clubs should also be benchmarking wages, promotional and other direct costs associated with generating gaming machine revenue. This is an area where the Astute Quarterly Industry Benchmarks report becomes an indispensable tool; it facilitates simple comparison across these metrics, which typically aren’t available elsewhere.

By subscribing to the Astute report, venues can determine not only how their gaming machines are performing in terms of the revenue they generate relative to their peers, but also how efficient the club is in converting that top line revenue into bottom line profit. An interesting fact is that within the Astute Benchmarking group the bottom 25 percent of clubs are marginally more efficient at doing this. This may strike as odd. It’s not that there aren’t economies of scale at the top end of town, but rather higher marginal tax rates quickly erode these advantages.

Regardless of size, venues can benefit from using benchmarks to ensure that they are running an efficient gaming operation that brings in more money to support the club’s core purpose: to invest in better community facilities or make donations to local charities and sporting groups.

Benchmarking can also assist in answering more detailed questions venue managers or directors may have about their gaming machine operations. The Astute report shows the distribution of gaming machines according to denomination. It may surprise some clubs to know that multi-denomination gaming machines are second only to the 1c gaming machine when it comes to their proliferation on gaming machine floors.

Benchmarking can also be used to work with gaming machine manufacturers to optimise performance. For example, the club may identify that a particular gaming machine manufacturer’s cabinets are performing below the industry average for that supplier, but that all other manufacturers are performing above average. The supplier can then determine a plan, such as game or denomination conversions, for boosting performance. This way the venue can ensure it is getting the most out of the floor space it dedicates to a particular brand.

In closing

Good employer/employee relationships also come about when employers ensure their staff have the right environment, knowledge, materials and equipment to perform the tasks expected of them, says Santolin.

Typically, once club boards and management get a taste for using data to drive their decision-making processes, they inevitably continue down that path and begin employing more sophisticated business intelligence practices. To avoid frustration down the track, it pays to invest in a product suite that can evolve with the club’s increasing demands.

There is nothing more aggravating than discovering a convoluted process to generate gaming statistics to compare them with the industry benchmark. To avoid that, look for alignment between the club’s benchmarking service and its gaming system.
It’s hard to overemphasise the importance of benchmarking. Having the appropriate tools and resources to know how your gaming measures up is not a luxury; it’s a necessity.


Daniel Mitchell is ClubsNSW Manager – Gaming Policy.
For more information or to request a demo, please email sales@ebetgroup.com.

Getting it right

Indoor club

MAX Head of Venue Performance, Riccardo Callegari explains how to make the best choice when implementing new games for your gaming floor.

Choosing a game to add to your gaming floor is a crucial decision for your venue. This article sets out some information and considerations to assist you to make the best choice for your venue.

Key Insights

  1. Looking at performance data from other jurisdictions is one of the most effective tools
  2. Speak to other clubs or hotel operators to gauge their expectation of what is and isn’t working in the market
  3. Try different denominations as a test to help clarify player preference

Industry Performance Data

One of the most effective tools is to look at performance data from other jurisdictions, but this also needs some consideration behind it. You need to consider the following key indicators:

  • The install base of the sample data.
    If the number of machines is quite low and the turnover is quite high, you may find that the venues included in the sample data are high turnover venues, which may make the data misleading.
  • Where the sample data comes from. Is it a good cross-section of clubs and pubs that would help you to make a better decision?
    The data contained in these reports is quite valuable and reliable.
    The other point to remember is that only those who pay for a benchmarking tool are included in the data, so it may be skewed to larger venues that can afford to participate. Smaller venues may not see the benefits of continuing a subscription. All in all, the data contained in these reports can be used as a good guide to choosing a game that will work.

All in all, the data contained in these reports can be used as a good guide to choosing a game that will work.

Use your Network

The best way to obtain a well-rounded view of what is working and what isn’t is to use your network. Speak to other club or hotel operators to gauge their expectation of what is working in the market or what is yet to be released as the next big thing. Use industry events or tradeshows to speak to sales reps. Gaming company representatives should be used as a good source of truth for what’s working in the market. The best representatives will not only recommend their own product, but have a balanced approach for any venue on what their competitors’ products are doing.

Games Catalogue

“They’re the people that come in every day and play the gaming machines, have a drink and buy a meal. So, as a leader, you have to pose the question to your staff: how do your strategies help the customers and, ultimately, the business?”

Sit down with your sales representative one day and go through their games catalogue. It would be interesting to see the progression of games models and how clones of games have evolved. As soon as a manufacturer brings out a cracker game, most often very soon after that there will be a similar game, with a similar maths model and all that’s changed is that there will be a slight tweak, some different symbols and eventually a family may be formed.

It also pays to see which games are available from previous years. What’s old is new again and you may be able to offer your players an old favourite again.

Experimentation

It pays to have a ‘whole of venue’ approach on your gaming floor. Try different denominations, as a test to help clarify player preference.

Look at all the manufacturers that are available. Try not to focus on the star performers at the time. You need to have a balanced approach, as what goes around comes around, and be forward planning for the next great game to be rolled out.

The Value of Feedback

Using Net Promoter Scores is a valuable way to collate customers’ feedback but it is how you use that feedback that matters, says MAX’s Head of Customer Insight, Kasia Witon-Wanstall.

In a service industry, the customer’s experience is vital. Seeking and encouraging feedback from your customers is an important way of checking in and ensuring your service is still relevant.

“You need to be asking your customers [for feedback] constantly,” says Kasia Witon-Wanstall, Head of Customer Insight at MAX. “Giving customers an opportunity to provide feedback is the most powerful thing you can do.”

However, according to Witon-Wanstall, the way in which you collect and use that feedback also plays a crucial role in how it can benefit your business.

“Some people make it hard for customers to complain. I don’t understand the point of that,” she says. “Complaints are an opportunity – it means someone is still giving you a chance to keep their business.”

For Witon-Wanstall, Net Promoter Scores – a system examining a customer’s loyalty to your business and their willingness to promote it to others, is a valuable tool in finding out what’s working and what isn’t.

“It taps into [the fact] that we, as humans, wouldn’t ever recommend or attach our name to something that wasn’t, in our opinion, good,” she says. “That frontline loyalty question gives us a firm point of where we stand with our collective customers, and then the ‘why’ gives us some indicators of areas we need to improve.”

Witon-Wanstall believes using Net Promoter Scores gives more weight, letting you know how many people feel that way and how strongly it makes them feel.

“What you say is going to influence the person that asked,” says Witon-Wanstall. “So, in a consumer space, we care about ratings and what you’re going to say and then we want to know why you’re going to say that.”

If a customer goes to the trouble of making a complaint on a website, the recipient of that feedback should be on high alert. However, it’s important to gain awareness of day-to-day issues that go unreported. Unless a customer’s experience was really terrible, they may simply forget, which doesn’t help your business.

“They’ll remember they don’t want to go back but they won’t remember why and that’s a problem,” says Witon-Wanstall. “Asking someone two months later won’t uncover these micro-moments.”

If a time-poor customer has to jump through hoops to complain or answer lengthy surveys, they will simply not bother.

“We talk about Net Promoter Scores and loyalty as the key indicators of what’s happening with customers and what they think of us,” remarks Witon-Wanstall. “It’s meant to help guide your business and identify areas to improve.”

Witon-Wanstall believes it’s also important to be specific about which part of your business requires feedback: “Ask the customers [specific questions about a part of the business] when they’re consuming that part of the business.”

Feedback has to be easy and non-confrontational for a customer, in order to provide you with valuable information. Without this information, it makes it increasingly difficult to satisfy customers and compete with other venues.

As Witon-Wanstall says, “What’s worse than bad feedback? No feedback!”

What It Means To Lead

Leading an organisation successfully is no mean feat. Venue heavyweights Brian Fletcher, Jackie Booth and Brian Cairns share their experiences and advice on leadership, and what it all means.

Brian Fletcher is no stranger to the hospitality and gaming industry. Currently serving as the Chief Executive Officer of Panthers, Fletcher has many years of experience in running a business under his belt. He was Chief Executive Officer of Hawkesbury Race Club for more than 25 years when he took on this role at Panthers in early 2016. And now, he oversees about 1,000 people within the Panthers grid.

To be a good leader, Fletcher swears by three simple rules: keep your budgets neat, make sure your organisation is clean and always treat people right.

“Leadership to me is making sure you treat the people underneath you well,” he says. “If you treat your managers right, you instil into them that they treat the people under them well too. This means giving them respect and being kind.”

“You don’t speak rudely to people just because you’re the boss,” he continues. “The nicer you are to them [the staff], the more loyalty you get. They jump on the bus and come with you on your company’s journey.”

Fletcher adds that all businesses revolve around people, and the hospitality industry is no exception.

Engage and Excite

If you were to ask Jackie Booth about her introduction into the hospitality industry, she would say she was ‘born’ into it – without a beat.

Booth started out as a food and beverage attendant at Zagame’s Matthew Flinders Hotel. That was almost 23 years ago. Today, she is the company’s Chief Operating Officer, managing more than 600 people with more than a dozen direct reports.

Booth is undeterred by the responsibilities: “My whole role is about ensuring that what we’re trying to accomplish is clear, and then motivating and empowering [the staff] to allow us to get there, and that’s through culture and recognition and excellent training.”

Setting a clear vision and goals for the business is the first step in engaging your employees, adds Brian Cairns, Chief Operations Officer of RSL Victoria. Cairns started his career with several council organisations and was offered the Chief Executive Officer position at Rosebud RSL at the age of 34. His understanding of the hospitality business and his fine administration skills helped him see through Rosebud RSL’s growth in those years. Today, he oversees operations throughout Victoria, with a dozen people reporting directly to him.

Cairns says good leaders need to have an “eye on the future and what they plan to do.”

“Foresight and setting clear goals are important traits,” he remarks. “Where do you see your business in five years, in 10? Who do you see coming along on your journey? These are some questions you should ask yourself and your team.”

He stresses it is also crucial – as a leader or a manager – to share aims and rationale with your staff, get them excited and engage them to come on the journey and reach those goals with you.

Fletcher brings up another point: once the goals have been set and communicated clearly to the staff, “you have to trust your staff to do what needs to get done.” In other words, empower them and do not micro-manage.

“I hate that [micro-managing],” Fletcher says. “I don’t need to do that. If I can’t trust, for example, my accountants to do their jobs and deliver, then I shouldn’t have them in the first place.”

And, if his staff reach a roadblock or are unsure of how to proceed, his advice to them is to go back to two things: what the business stands for, and what do the customers want.

“If you don’t have a customer, you haven’t got a job. So you can’t forget them in your business strategies and planning. We have to listen to them, understand their pain-points and get the feedback that we need.”

“They’re the people that come in every day and play the gaming machines, have a drink and buy a meal. So, as a leader, you have to pose the question to your staff: how do your strategies help the customers and, ultimately, the business?”

Deal with that Pending Tray

“They’re the people that come in every day and play the gaming machines, have a drink and buy a meal. So, as a leader, you have to pose the question to your staff: how do your strategies help the customers and, ultimately, the business?”

There are times when things don’t go to plan or a decision made at the top-level backfires. Fletcher – whose no-fuss, straightforward demeanour is respected throughout the Panthers organisation and beyond – believes mistakes are part of the learning journey and “one must be honest, deal with the error and move on.”

“I’ve made plenty of [mistakes] over my time,” he says. “It’s all a learning process; as long as you’re aware of that error, you’re upfront about it and seek a solution right after, you move on. The biggest mistake you can do is sweep it under the carpet.”

Admitting to an error or dealing with a conflict are not easy things to do and they both require some courage. But, like Fletcher, Cairns says to do nothing or to procrastinate on the next steps only makes matters worse. He gives an analogy of offices from back in the day where the ‘In’, ‘Out’ and ‘Pending’ trays were ubiquitous.

“We had a lot of paperwork then and, to sort them out, we had these trays,” he explains. “Out of the three, which had the highest pile of work? The ‘Pending’ trays. And why? Because people did not want to deal with the more difficult tasks. And the pile would just keep getting higher.”

Procrastinating on conflicts or tough decisions sends a clear message to your employees: you cannot make a decision.

“The bottom-line is you’re trying not to make a decision,” continues Cairns. “I think leadership is about making decisions. They might not always be right, they might not always sit well with everybody, but I think leadership is sticking to a decision and saying, ‘Look, we’re going to do this, this is where we’re going’.”

In the People Business

“The bottom-line is you’re trying not to make a decision,” continues Cairns. “I think leadership is about making decisions. They might not always be right, they might not always sit well with everybody, but I think leadership is sticking to a decision and saying, ‘Look, we’re going to do this, this is where we’re going’.”

Speaking to Booth, Cairns and Fletcher about their leadership experiences, a few things shine brightly from the conversations – their passion for their staff and company, their intimate knowledge of the hospitality industry and how challenging it can be, and how crucial it is to recognise the good work of employees.

“If you ask me what part of the business is the most important part, I say, everyone plays a part,” says Cairns. “The guy who’s in the back washing 500 plates is working every bit as hard as the person at the front. Everybody’s contributing to the

business and you need to recognise that.”

At Zagame’s, there’s an incentive program that runs between its venues.

“We write what we call ‘Z-mails’ for each other, and it’s about colleagues recognising colleagues, rather than management recognising staff,” Booth says. “So, if people see their colleagues doing something that is above and beyond the standard scope of their daily job, they can write them a Z-mail, which comes to the head office. The directors, the operations team and I will review them.”

Every quarter, the winning staff members from each Zagame venue are rewarded with certificates, gift vouchers and special pins to wear on their uniforms.

However, Booth advises, even the smallest gestures and acknowledgements can go a long way, especially on hectic days when everyone else is out partying during the weekends or celebrating Christmas, and your employees are working hard trying to look after them.

“It’s about recognising that and making those days easier on [your team] so this could mean shorter shifts or a special lunch for the staff,” she says. “Small rewards like this show them you care.”

“Hospitality is not easy but it’s a very rewarding industry,” concludes Booth. “You have the power to impact people’s experiences in your venue. For example, you can make someone’s birthday a great one or a bad one. As a manager, if you treat your staff right, they will treat the customer right. In the end, everyone, including the business, wins.”

Streetwise

Street food

How street food is influencing the restaurant business

The food industry is an exciting place to be, and whether we’re producers, conveyors, purveyors, creators or consumers, it affects us all. But it’s a two-way street – we influence the industry as much as it influences us. The innovations, the popular movements, where we choose to spend our money all play a major role in determining what the hottest new food trends will be.

Street food is not a new creation. It has been around for centuries, dating back to Ancient Greece, where small fried fish were sold in the streets of the powerful empire. Evidence of street food vendors has even been excavated from the remains of Pompeii and, in these historic cultures, street food would typically have been that of the lower classes, who did not have access to hearths.

In today’s modern, fast-paced digital age, street food has evolved and developed with the times, no longer representing a ‘poor man’s meal’, but rather an indication of the food fashions and flavours that are hot-right-now on the culinary scene.

The street food of the 21st century represents the flavours and fare that are ‘trending’. It’s generally viewed as authentic to its origin, good value (being cheaper than a restaurant meal and better in nutrition and taste than franchise fast food) and a quick and easy to eat option.

Food trucks and food truck parks are a phenomenon that has boomed in recent times. These mobile caterers are now an everyday occurrence in our lives, often spotted trawling our cities for their new resting place to feed the hordes of hungry, or across social media boasting their locations for the day. Apps have been developed around food trucks, allowing street food connoisseurs to track the whereabouts of their favourite vehicular eateries, or to discover which cuisines and trucks are in their area at any given time.

The street food sensation has made a significant impact on the culinary industry, so much so that it can be seen affecting the traditional restaurant business. Its influence is creeping into the menus of fixed restaurants and catering companies, changing both the styles and the flavours of the dishes on offer. Street food has introduced people to bold, global flavours – bringing a world of cuisines, tastes and recipes to their fingertips. People are becoming accustomed to trying new and exciting things, to opening a menu and finding the unfamiliar, and relishing the excitement of experiencing something unknown. And when a food or a cuisine is trending, saturating social media and culinary news, people naturally want to try it, and so they seek it out. As a result, we see restaurants offering seasonal menus and changing their options to keep up with the trends of the time.

Many Mexican restaurants are a classic example of street foods that have found their way into bricks-and-mortar dining menus. Dishes such as tacos, tostadas, quesadillas, empanadas, fajitas and nachos began as antojitos (‘little cravings’) and have become – in the Western world – restaurant staples and legitimate meals. Melbourne institution Fonda is an embodiment of this movement, with its seven restaurant locations (plus one Sydney outlet) featuring menus brimming with traditional street foods, from its popular charred corn cob to gourmet fish tacos.

Similarly, the traditional Chinese dish of bao, which has become increasingly popular in restaurants around Australia, is typically eaten as a street food in its country of origin. In many Chinese cultures, bao (a steamed yeast bun filled with meat or vegetarian fillings and served with soy sauce or vinegar) is often eaten for breakfast and is favoured as a portable snack. In Japan, where it is also popular, bao is typically sold in convenience stores. The bao’s rise in popularity in Australia has seen it introduced into traditional restaurant menus, alongside dumplings and wontons. New Shanghai, a Chinese restaurant that has locations in Sydney and Melbourne, includes its xiao long bao (steamed pork dumplings) and its crab meat bao on its menu as its signature dishes.

Another vital appeal of street food that is trickling into restaurants is the nature of the meal – the style of eating street food encourages the shareable meal. As interests are piqued, and taste buds ignited, diners want to try a wide array of menu items. Rather than ordering an entrée and main, people are adopting the sharing plate style of dining – ordering a wide variety of small, medium and large dishes to share among the entire table; therefore, allowing them to sample extensively from the menu and taste many different dishes. This mix-and-match style of dining provides restaurant patrons with a low-risk way of trying different foods or dishes they may not otherwise order and giving them the opportunity to taste a broader spectrum of a region’s cuisine.

The street food method of dining has taken the social, playful and easy-going nature of experiencing food and flavour and brought it from the streets into restaurants. And with good reason – let the flavour adventure continue.

Renovate without breaking the bank

Women talking

Giving your venue a makeover does not have to be expensive and MAX Venue Solutions’ senior venue designer explains how you can refresh your club’s look without it costing a bomb.

Key Insights

Top three tips for renovating on a budget:

  1. Do something every year to refresh a space, even if it’s simply reupholstering chairs or changing the lighting.
  2. Give the busy areas a new coat of paint.
  3. Work within the rules of visual merchandising and regularly place a new piece of furniture at the front of the club – this keeps it looking fresh.

The word ‘refurbishment’ can strike fear into the heart of even the hardiest venue manager. Escalating costs, disruption and not knowing where to start are the most common reasons for letting a venue get a bit tatty around the edges. But refurbishing doesn’t have to be expensive; in fact sometimes all a venue needs is a splash of paint and a strategically placed piece of furniture.

Angela Bambino, Senior Venue Designer for MAX Venue Solutions, has worked with budgets, both big and small. “My team and I do around 43 refurbishments a year, all with varying budgets,” she says. “No budget is too small, and I regularly work with venues that don’t have a lot of money. If that’s the case, then we work together to get the best outcome with what they’ve got. We recently worked with a budget of $30,000 and primarily focused on changing the gaming stools. The club had a budget of up to $300 a chair, and so we worked within that scope.

“While we were there, we also chatted with them about the merits of giving the place a new coat of paint and, because money was tight, I helped them pick out colours and then the club reached out to their members to help them paint.”

If $30,000 still sounds like an awful lot of money, then Bambino’s advice is to start modestly. “If the budget is small, my advice would be to look at the areas that create the most revenue, which is usually the gaming room, and start there,” she says. “If the gaming room is looking good, then I would suggest that the venue update key signage, refresh the bar or put in a self-service station for members to help themselves to a hot beverage. If money is tight, then it makes sense to be sure that it’s being invested in the right area.”

“If the budget is small, my advice would be to look at the areas that create the most revenue, which is usually the gaming room, and start there.”

Bambino and her team advise venues to keep everything as refreshed and up-to-date as they can. “There’s something to be learned from visual merchandising, and I always tell venues to think about their business like the windows in Myer,” she says. “If you go past Myer and they don’t change their windows month after month, then it gets stale, and no one wants to go in. It’s the same for the clubs. Take the time to stand back and really look at the space in its totality and then do something to make a few changes and keep it fresh.”

On the flip side, and where money is no object, Bambino states that a full refurbishment should be done every five to seven years. “A complete refurbishment is the only way to reinvent a space,” she says. “It’s daunting, but most venues are renovating every 12 years, which is just too long. If the budget is an issue, then create a five-year plan and start saving. If that’s just not possible, a solution would be to start making minor changes and get to know your customers as well as the demographics of the surrounding areas. We’re currently in the middle of a renovation for Clayton RSL in Victoria and we did a huge amount of research on the area. We overlaid the census information with that of the current members and saw that there was a disconnect. This meant that we could focus our attention on drawing in a new crowd and refurbish the place accordingly. It sounds so simple, but a lot of clubs tend to create spaces that they want, rather than thinking about what their customers want.”

It seems that the key to sprucing up the place is simply doing what you can with whatever you’ve got, and not being overwhelmed by the process.

The idea of getting members involved is perfect. Not only will you be encouraging a sense of community, but you’ll also get your venue refreshed in the process. That makes everyone a winner and in the world of gaming there really is no better outcome.