Michael Bauer, Chief Financial Officer at Greentube, recently spoke to SBC Americas about why New Jersey and Michigan were selected as the starting points for the company’s US journey, in addition to future plans and the characteristics of the perfect online casino jurisdiction.
SBC Americas: Why did Greentube choose to focus on NJ and MI as the first two states to enter the US online casino market over some of the other jurisdictions?
Michael Bauer: While US igaming jurisdictions are still developing at a rapid pace, they are still comparatively in their infancy and New Jersey was the very first market to regulate online casino in North America. We felt that an established state represented the ideal starting point.
The choice of Michigan as the second state to launch in was a decision taken largely on the back of the regulatory framework in place. The taxation situation there is more friendly than Pennsylvania and that swayed us to make the move that we did. We have since also gained licences in Pennsylvania and Connecticut and will shortly launch in those markets which will be two exciting milestones in our US journey.
SBC: How have you managed to carve out a position in the market for Greentube to flourish in NJ and MI, considering they are very saturated markets?
MB: Success in any region requires that every element is in place. Quality products that are tailored to the preferences of local players are crucial and so is the right pricing, effective distribution and solid customer relations. Marketing and promotions are also key and this is something that will see an increased focus from us going forward.
While we are working continuously on improving each element, I think we have reached a level that is at least closer to our expectations. Having said that, part of our DNA is to continuously improve ourselves and achieve new growth, so we’re confident that we will meet the challenge as we have in every other market globally.
SBC: Four years into the Greentube US venture, how would you assess your performance so far and what titles have proven particularly successful?
MB: There’s still much to improve on in all aspects, but we have several success stories that we are exceptionally proud of. Whenever I talk to our customers and they express their satisfaction with Greentube’s performance, I feel proud of our teams’ achievements.
Our most notable success stories so far have been with our Diamond Cash and Thunder Cash linked jackpot series, as well as certain stand-alone titles such as Lonestar Jackpots, Piggy Prizes – Wand of Riches and Charming Lady’s Boom. We have accomplished great things in a relatively short space of time and I have no doubt this form will continue.
SBC: What makes an ideal jurisdiction for the online casino industry and which states are you eyeing up next?
MB: The ideal jurisdiction provides a stable, long-term framework for operators, suppliers and players. To achieve maximum channelisation of players into the regulated market, it is key to allow products that are attractive enough and not subject to excessive restrictions.
For operators, it is important that they engage with effective communication and marketing, otherwise, it can be difficult to engage with players who may move toward an illegal offering instead.
Long-term stability requires a steady regulatory environment that doesn’t regularly introduce restrictive measures such as marketing bans, or limitations on winnings as we’ve seen elsewhere. A robust, reliable regulatory framework works for everyone and restricts the appeal of the black market.
It is important to understand that each operator invests heavily in their product and in attracting a critical mass of users. If your business plan doesn’t evolve as expected because of a sudden change in regulation, shareholders bear the brunt financially.
Still, we believe some markets fulfil these criteria and we are continuing to expand with a view of making moves within them. The next move for us in the US is taking our offering live in Pennsylvania and Connecticut while in LatAm, we have our sights firmly set on Brazil.
SBC: Another opportunity that Greentube US is seeking to capitalise on is the ilottery sector. What opportunities does this vertical offer Greentube and how crucial is ilottery to your US strategy?
MB: The ilottery sector is interesting because of its stability and potential for further growth. To participate effectively in that market, we have developed specific games that we think are a good fit and enjoy the appropriate level of player engagement and entertainment. We are currently live with two US ilotteries and the feedback has so far been extremely positive. Nevertheless, we are still learning and experimenting with new concepts to ensure we maximise the encouraging start.
SBC: Is Greentube targeting ilottery exposure in markets where you already have an igaming presence, or is it rather to enter new states?
MB: Where possible, we will supply to both ilotteries and online casinos as we think there are distinct differences in the player profiles to justify doing so. We develop games for both sectors and see plenty of growth opportunities on each front.
SBC: Which are the key ilottery states for Greentube and where can we expect to see your titles throughout the rest of the year?
MB: We’re currently live with lotteries in Washington DC and Virginia and are on track to go live in Michigan soon. In Canada, we have products live with the lotteries of British Columbia and Quebec. There’s significant scope for us to expand into Ontario and it is something we will continue to monitor.
SBC: Greentube has recently penned a deal with Caesars Digital to grow its client roster in MI and NJ. How crucial is this deal for Greentube and what can it tell us about your US operations?
MB: Caesars is one of the most iconic casino brands worldwide and we expect it to play a big role in the future online space. The go-live with the iconic name is an important milestone for us in the US. It signifies the trust that they place in us as a provider and the important role that the market holds in our overall strategy.