Quo vadis Spanish casinos?

A few days ago, a very talented young manager asked me about the future of the casinos in Spain. He just turned 31 years old (8 in the business) and, most probably, he wanted to know if there was any point on keep on going working in the industry. That simple question made me think for a while, and this article will be an extension of the answer I gave him.

THE URGENT NEED FOR INNOVATION
For those professionals that started their careers in the late 70s, early 80s, working in the casinos was like a dream: it had social prestige, the pay was great and they had lots of fun. Those executives -like me- that started much later have heard their stories, how nice it was, back on those days, the size of the games, the French roulette, the Chemin de Fer, plenty of funny anecdotes. I put attention to those stories for a while, because I was very naive back then. Nowadays, I know that individuals that only speak with illusion about their past are not so worth listening. The really interesting ones talk about their next projects. Normally, the past is just a set of anecdotes with little value, but truth be told, they had a wonderful time.

Coming back to the current situation of casinos in Spain, in the last three decades, especially after the turn of the century, and all the way to the economic crisis of 2008m we haven’t seen much improvement on them. At the same time, the gaming arcades (‘salones de juego’) have evolved a lot. The inclusion of electronic roulettes, sports betting terminals, upgraded slots and their preferential location (in the gaming centers) has been a winning combination. This has nothing to do with the dark, scary and boring venues that were those places not so many years ago. And yes, they are direct competitors of the casinos, regardless of what some short-sighted Spanish casino owners may think.

Digital gaming became legal in 2012, initially. I would not say that playing on the Internet it is a direct substitute of playing in a land-based casino. I do think that casinos operate on a much wider scale. They compete with all sorts of entertainment options, and that is when the real situation becomes much more obvious. Today, people crave for the new, the attention spans are shorter. In order to stay current, you need to innovate, and that’s exactly where the casinos in Spain, and in many other jurisdictions, fail miserably. For example, in the table games product, most probably, the only difference between now and the late 70s is the presence of chippers and shufflers, and those are not meant to improve the player experience, but to increase the pace and the integrity of the games, not very exciting indeed. In the Spanish casinos were most of the table games (TG) staff have been in the business for more than 10 years (and even less), and there are plenty of them, their employees are normally more worried about the fulfilling of their collective agreement than about anything else. In fact, many times, the customer is a nuisance. TG staff has forgotten which is the only reason of their mere existence. To make matters worse, the tax on winnings, which in several Spanish regions goes up to 60 percent of the gaming revenues, one of the highest taxes in the whole Spanish economy considering all industries, is not only obsolete, but plain dumb.

NEW CHALLENGES AND CASINO STAFF CAREERS
The slot machines, electronic roulettes, and hybrid tables face many challenges, like the homologation process. In the Spanish gaming industry, we have 17 different jurisdictions, and that basically kills the competition from the smaller suppliers. They just cannot make the economic effort of having to pay so many homologations. In practice, it limits the capacity of casino operators to give more choices to their customers. Another tool that is commonly used in many other gaming markets, the loyalty program, because of data protection regulations and our tax system, is seen with a lot of suspicion by the customers (“What’s the point of giving my data if, at some moment in the future, the Spanish revenue service will come after me?”). In the process, the casinos lose the capacity to allocate their marketing efforts and properly recognize their best customers.

Regarding career prospects, due to the fact that the number of casinos is very small, around 45 (less than one casino per every million inhabitants), the possibility to develop a strong career is very limited. Most casino managers in Spain do not move; they stay in their jobs for many years. During the 90s, there was at least the possibility of going to Latin America. You could find several decent options in Argentina, Colombia, Venezuela, Panama, Dominican Republic, and Peru. The economic conditions and benefits were very good, but that is not the case around these days. Just taking your luggage and crossing the Atlantic Ocean does not instantly get you a €5,000 per month salary anymore. The new generation of Spanish gaming professionals is “achieving the Latin American Dream” in a completely different way than their predecessors of the 90s. Don’t forget that, with a very few exceptions, what you get is what you pay for.

In summary, I do not see a very bright future for the Spanish casinos as businesses in general terms, unless that many things change. However, I do consider them excellent places to start a career that later on could evolve into working in other areas of the gaming sector. In fact, the industry as a whole is expanding all the time (eSports, DFS, online/mobile gaming) and the casinos could serve as a good introduction for young and enthusiastic executives. Additionally, for those interested in the hospitality business, it is a convenient option as well. You can spend a few years and then move on to other types of brick-and- mortar venues (hotels, clubs, bars) because one thing has not changed: the land-based casinos are still a very good school of life and always will be.