This week, virtual games provider VSoftCo signed a new deal with Sport-Shotz, a provider of sports themed casino games.
Just after the story broke, we caught up with VSoftCo’s Chief Commercial Officer Simon Westbury to discuss a shift towards virtuals in the digital arena, whether they should be treated as a casino or sports betting product, and how cross channel learning can increase the impact of new product launches.
SBC: Can you detail to SBC readers how virtuals have transitioned from a retail proposition to a digital product? Why was this transition needed?
SW: Virtuals have always been part of the digital product portfolio; the large UK operators have had online and mobile virtuals for many years and VSoftCo has legacy online deals dating back to 2010. I think the shift has come from both the suppliers and operators, but there is most definitely a focus on virtuals in the digital arena.
We have seen the virtual sports supplier market burgeoning over the last three years, a fact mirrored in the forthcoming SBC awards with several award categories being dedicated to virtual suppliers. I think the increased competition in the space has been good for everyone with everyone trying to find their niche in the market, meaning as suppliers try and maximize revenues they have looked outside of the traditional space of retail to grow into online.
However, I think the key driver has been from operators who want to offer a 360 service to their customers. To quote my old boss at Amaya, David Baazov, it does not matter where the customer is acquired, be that from retail, online or mobile, the experience for the player is the same.
I think I am on record as far back as G2E in 2011 in saying this, and I believe what we have seen in the last twelve to eighteen months is the convergence of this strategy into the virtual sports space. Some of our competitors talk about an online revolution, a revolution would suggest an aggressive overthrow of the existing status quo, but we do not see that at VSoftCo.
We see an evolution to where we provide a full 360 service to our customers, so they can provide the best service to their customers, whether they are operating in retail and online, or one or the other.
SBC: As a product, how should virtual sports be treated by digital operators? Are they casino or betting product… should this product definement even matter?
SW: I think all the evidence suggests, and what we are seeing at VSoftCo, is that virtuals should most definitely sit on the sports tab as a sportsbook product. In terms of deployment it is a quick and easy integration through the provision of an xml data feed with new sports being added quickly and easily. We recently managed to execute integration with two weeks.
The proof of the pudding is in the revenue that is derived; when we deploy our Bet Processing Engine (BPE) for casino engines and the bets are sitting on our system, we currently see that casino suppliers are operating at 20% of revenue compared with our sportsbook customers.
I believe the reason for this is clear, a casino player is not used to waiting for a scheduled game. They are used to going onto a casino tab and launching a slot game that is instantaneous. I believe for virtual slots to work in a casino environment they need to be on demand, and I know some of VSoftCo’s competitors have had some great space in this area and it is an area that we are most definitely considering, and the launch of our Spot the Ball product is an example of this.
Additionally, we have seen that football is dominant sport in the retail environment in terms of revenue but in the online space we have seen a more even distribution of revenue across the different sports. I think this an interesting development and I think we have seen the consequence of this across the virtual sports supplier space with more and more suppliers developing different types of games.
Part of this development is of course driven by the geographical expansion of virtuals sports and the need to develop sports that are relevant to different geographical areas. We have seen our partners at Vermantia develop Baseball for a geographical region, as well as partners at Kiron develop some winter themed sports, which has aided their geographical expansion.
Therefore, I think the key learning’s are to develop a differentiated product that will appeal to both sports and casino players i.e. a scheduled portfolio of games as well as an on-demand library of sports combined with the development of virtual sports that have a geographical resonance.
SBC: For digital operators, how does the VSoftCo team rollout virtual sports inventory for customers who may not be accustomed to its product range? Does cross learning between channels help you with these product launches?
SW: I think it is a bit like going back to the old school way of selling. I am not one to say how many flights I undertake in a year, but there has been a drive from the team at VSoftCo to help educate the digital sector on the value of virtuals.
The argument for virtuals in terms of revenue for an operator is clear and is easier to demonstrate to an operator than selling a new slot game. The business case is there, no question, but it is large education piece to explain how virtuals should be deployed and we have incorporated a large amount of learning’s into this.
For example, we do not offer as many bet types on football as we do in a retail environment to ensure that the user interface is not cluttered. This is key because if a player is playing virtual sports on their mobile or tablet, we need to ensure the bet information is relevant and the player is not swamped with different bet types, as well as ensuring the information is displayed on a smaller screen.
We have also shortened the event window for the online product range to ensure that the player does not become bored and their session time is maximised. I think the experience we have in the retail environment has been beneficial, but we have had to adapt this knowledge for the online player.
SBC: From a product perspective, are we seeing any new digital disciplines evolve in the development of virtual games, such as gamification components?
SW: Yes, most definitely, we are seeing the development of virtual sports and adapting them into a casino product. A fact again recognized by SBC with the Best Sports Themed game being highly competitive at the forthcoming SBC awards. VSoftCo have been part of this with the development of our Spot the Ball product, and I think we are seeing more and more virtual sports providers taking their games and adapting them to transcend the sports and casino verticals.
I think in the retail space, the challenge has always been to re-create the most popular bet markets and excitement of games such as tennis, which is the second most bet on live sport in Italy but failed as a virtual sport in a retail environment. Our clients told us that although a lot of virtual sports such as tennis were graphically excellent the player could not relate to them in bet types.
Again, I use the example of boxing as I discussed at the Betting on Football conference. If a player is betting on a scheduled boxing game, how can you have a knock out in the first round of a five-minute event, as the event window would end within a minute – what does the player do?
The online products and the on-demand product range allows for the virtual supplier to re-create the most popular bet types. So, although graphics are important, we are seeing that excellent graphics without the ability to create accurate bet types, as well as in game excitement which mirrors real sport, causes the player to become disengaged.
Although the development of the digital space has created challenges, the opportunities that have been presented are amazing and have, to some degree, re-defined the focus for virtual sports suppliers.
Finally, one digital discipline that VSoftCo has been very excited about is the development of spread betting product that has opened a very exciting niche space for us. The project was initially a bit of punt for us, but we have seen that average bet stakes are five times higher than we are seeing in the retail space, and the adaption of our unique real-time technology has allowed us to expand into the space with verve and enthusiasm.