Taking a single-strategy route to market might be seen as placing all of one’s eggs in the proverbial basket. But according to PlayStar CEO Per Hellberg, positioning an online casino-only offer to the growing US gaming market is not only covering cost of entry, but delivering an early return on investment and enhanced customer retention.
Hellberg attributed the online casino brand’s strong results in the US market so far to its ability to not just acquire new customers, but retain a loyal base of players. The company, which launched its fully-licensed igaming product in New Jersey in July last year, said the brand has already exceeded its KPI forecasts.
Playstar’s stated goal is to provide an online casino experience that’s heavily focused on personalisation and player engagement, made achievable through the use of real-time data and predictive modelling to create journeys that are tailored to the player.
When asked about the New Jersey launch, Hellberg stated that PlayStar is retaining customers much sooner than initially anticipated and believes the brand is one of the best in the US market when it comes to retention.
By way of explanation, he said: “Based on how we approached this and the experience of the people we have – and having the support systems ready to control and adjust, I think that has worked far more efficiently than we thought it would do.
“What that has led to is the fact that we’re not only acquiring the customers at a better price than we thought we would have, we’re retaining them for far longer than we ever thought we would do.
“We are now retaining customers that we thought we would in maybe three or four years”
“We are now retaining customers that we thought we would in maybe three or four years from now. And I dare to say that we’re probably one of the best in the US market in retention currently.”
Key to building that vital player retention, said Hellberg, is PlayStar’s sole focus on online casino, as opposed to the approach adopted by competing operators that offer a broader product selection. A specialised gaming offer and retention strategy, he argues, can result in increased player values and a better return on marketing investments.
PlayStar’s impact in the US is already garnering attention. The operator recently saw $15m worth of equity investment ploughed into its future growth by Meyer Global Management. That funding will be used to support its launch in Pennsylvania and again with more state launches that are expected to follow.
When it comes to investing in the US commercial gaming industry, Hellberg believes that now is the “best time ever” to do so due to the fact that operators are becoming more “financially efficient” and far savvier at adopting smart retention strategies while simultaneously recruiting knowledgeable teams.
Since the repeal of PASPA in 2018, the big push has inevitably been focused on sports betting, prompting Playstar to take an alternative route to market with its sole online casino offering. Consequently, revenue generated from the segment against its operational expenses, said Hellberg, has helped keep overheads low.
“The key thing is – if you want to run a very focused business – is to stay focused”
That approach, he said, has ensured that the cost of entry into New Jersey has been covered. “It means we can launch into states quite cheaply. Of course, there are licensing and marketing costs to take into consideration, but above that there’s very little additional cost beyond customer support.”
The CEO believes that even in high-tax states like Pennsylvania, by sticking to its strategy the company should still be able to see a strong return on its investment.
But with plenty of states yet to open up to online casino gaming, Playstar is already working on market access deals in anticipation of legislation making it onto the statute books. That forward-thinking approach and deal making has been aided, said Hellberg, by the funding it has attracted. “It has demonstrated to potential partners that we’re sustainable and can be trusted to deliver when that time arrives” he said.
As for potentially expanding beyond the US and into Canada, the CEO noted that the market is “quite populated already”. If PlayStar had wanted to be in the Canadian market, it should have done so earlier in order to avoid splitting its focus between the two North American countries, he conceded.
He explained: “The key thing is – if you want to run a very focused business – is to stay focused. And if we had intended to go into Canada, we should have probably done that around now or even a bit earlier. But we would have needed to split our attention between the USA and Canada – and rest assured, those markets are very different.”
“We know that the market average for player retention is about 30 per cent to 40 per cent … which we believe is a bit low”
Looking ahead, besides launching in more states and having broader market access agreements, PlayStar said it remains firmly focused on continuing to serve the customer, making sure it utilises their data to keep them coming back.
That, emphasised Hellberg, will require a data structure that is “personalised per customer” and one that works in real-time, targeting players in the right way and “delivering a quick and efficient service to keep them happy”.
He concluded: “We know that the market average for player retention is about 30 per cent to 40 per cent over four months in the US, which we believe is a bit low. We now have 50 per cent of our customers still with us after four months.
“That’s unheard of; but it’s how it’s worked out because we started from a position of being able to personalise or offer and talk to the human instead of an account.”