Cashless is an option, not a rule – the evolving world of land-based payment

Land-based casino properties across the globe has experienced an influx in cashless payment options integrated onto its gaming machines. In the most recent SBC Leaders magazine, Noah Acres of Acres Manufacturing Company and Jonathan Michaels, SVP, Strategic Development & Government Affairs at Sightline, provided their input into the cashless evolution.

In the words of Bill Gates – “the first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency.”

Throughout the land-based casino sector we’re seeing these words come to fruition with the constant partnerships between payment firms and brick-and-mortar properties that have led to the integration of cashless payment options to its gaming machines. 

Earlier this year, Acres introduced its Cashless Casino, a product that enables operators to deploy cashless gaming and loyalty solutions. 

At the time, Noah Acres of Acres Manufacturing Company noted that early deployments of Foundation cashless gaming have “proven” that cashless players increase their play and visitation. 

On whether there’s a noticeable difference from physical cash, Acres explained that, from early returns, it proves that cashless helps casinos earn more profit, and believes this trend “will continue”. 

He commented: “Over 80 per cent of consumer purchases are made using non-cash methods and casinos are one of the last remaining cash-only businesses. Today’s cash players frequently have to make a trip to the bank to withdraw cash for casino play.  

“Those that don’t plan ahead may have to pay expensive ATM or cash advance fees at the casino. This adds friction to the process and makes the player experience more burdensome.

“Penn Entertainment reports cashless players increase visitation by 18 per cent and time on device by 22 per cent. Many of the early adopters to cashless will be high limit players that can continue to reload their mobile wallet without leaving the game.” 

Sightline are another firm making headways in the cashless field with the firm gaining approval by the Nevada Gaming Commission on its petition to provide casino customers in the state with a “streamlined cashless experience” at the start of the year.  

This change would enable Sightline to implement digital identity verification on behalf of its operator partners in Nevada. 

Adding to the thoughts of Acres, Jonathan Michaels, SVP, Strategic Development & Government Affairs at Sightline, stated that, in time, properties will certainly see an overall lift by transforming to digital payments. 

Michaels explained: “Cash is a huge cost centre for properties – from the cost of acquiring it, from the people to transport it and count it, and the security issues around having large amounts of cash. In every other industry that has gone cashless, there is a lift in spend – and gaming is no different. 

“You have seen Penn Entertainment’s CEO, Jay Snowden, talk about the early successes of their cashless program and the increase in spend seen when comparing properties that have cashless to properties that do not. 

“The importance of omnichannel payments here is paramount. As digital gaming continues to grow, you want to serve your customers wherever they want to play. Our view on omnichannel is that money and loyalty should follow a customer wherever they go. This omnichannel lift in spend and play is already apparent too. 

“Caesars reported that customers who they sourced from their digital channels spent $200m at brick-and-mortar properties. In their last earnings call, MGM Resorts reported that 40 per cent of their overall MGM Rewards enrolments now come via their digital channels. 

“This omnichannel tie is going to be the focus for operators over the next two years and the best way to leverage this is to allow for omnichannel payments, allowing the same funds to be used online and on-property.”

Looking into how this new way of paying will improve player engagement and retention for land-based properties, Acres observed that smart casinos want their players to download an engaging mobile app and emphasised that “cashless will be the glue that holds this app together”. 

“In the case of Acres, our Foundation platform merges cashless payments with loyalty and bonus using real-time player data, which will make the overall play experience more entertaining and rewarding,” Acres said. “Players will want to use cashless because they’ll be able to win more.”

Echoing these thoughts, Michaels expressed that there are “several avenues” that land-based operators can go down to leverage digital payments and technology to aid engagement and retention. 

The Sightlight SVP continued: “On the engagement side, cashless will be a mobile-first proposition. We leverage our Mobile+ app platform, which is live at more than 100 casinos nationwide, providing them with avenues to engage their customers. 

“Leveraging cashless, you can build a true and customised picture of what your guests want to do on property. Be it gambling, restaurants, nightlife, entertainment, hotel, spa – whatever it may be, you can better engage that guest by leveraging the personalisation aspects afforded by cashless and mobile. 

“Leveraging that personalisation, you can increase retention by delivering rewards and loyalty that matter to that guest. The days where you send out expensive hard-mailers with an offer to all your guests are gone – and they will be replaced by custom targeting based on guest activity both on and off property. 

“Payments allow you to meet your guests where they are – be it visiting your casino or via your digital channels. The goal we help reinforce for our operator clients is to help them best engage their customers wherever they may be – and cashless is an incredible tool to help them do that.”

However, with the ever evolving digitalisation throughout society as a whole, could we see brick-and-mortar casinos lose that so-called cliche ‘old school’ appeal? 

Responding to that point, Acres emphasised that losing old-school appeal is a “common misnomer” that is “without merit”.

He stressed: “Cashless is an option, not a rule. Players who want or prefer cashless can use the new technology while those with old-school physical cash preferences can continue uninterrupted.

“But the idea that casinos adopting new technology burdens or turns players off is an oft-repeated misnomer in the casino industry.

“In the 1990s the experts said players preferred mechanical spinning reels and didn’t “trust” video reels. This was completely false and today you can see roughly 90 per cent of all slots are video.

“The same experts also told us that players loved using coins in slots and wouldn’t adapt to bill validators or TITO technology. The expert logic said players loved handling coins and that slots couldn’t survive without the audible noise of coins clanging in the coin tray.  

“Of course, today almost everyone would be completely disgusted with handling a large volume of coins, let alone lugging coin buckets from machine to machine.

“Remember that 80 per cent of consumer transactions are non-cash. How ridiculous is it for someone to argue that cashless won’t work in a casino?”

Throughout any changes in the industry, the main clarity we hear is that customer service is the biggest focus and evolutionary directions also factor this in mind. That being said, what are the implications of going cashless in a land-based casino to AML and KYC? 

On this, Michaels concluded that digital payments provide a “huge benefit” for anti-money laundering and know your customer efforts. 

He explained: “Regarding AML, all digital transactions have a corresponding digital record – and can be tracked accordingly by properties, payment companies and law enforcement where appropriate. 

“AML is trying to find a needle in a haystack. With cashless payments and cashless wagering accounts, you can reduce the size of that haystack.”