For the better part of nearly 3 decades videogames and gambling were two different, distinct forms of entertainment. Even with the rise of online casinos during the 2000s, the games they offered still couldn't quite be called videogames either. This was mostly due to the term “videogame” being used to describe a game in which your skill determines the outcome, whereas the outcome of playing a casino game would be mostly based on chance.
However, something else happened in the 2000s that's also beginning to have a major impact on online gambling: videogames going mainstream. No longer the exclusive realm of geeks and little kids, videogames are just as much a regular part of the daily lives of Millennials and GenZers as television has been for previous generations. Taking advantage of this cultural shift, online casinos are taking a new approach with their games to draw in these demographics.
Why Target a New Demographic?
While many Millennials and GenZers have never put money in a slot machine in their life, online or off, most have spent money on videogames at some point. And not just the purchase of the game itself, but rather, spending currency on in-game purchases. In fact, many regularly spend real money on “loot boxes” a sort of slot machine like mechanic in which they get random in-game prizes from a box or chest.
While this practice has been criticized as “gambling for minors” among members of the US government, it doesn't change the fact that the loot box system has been incredibly lucrative for the companies who use it, many of whom make more money through loot boxes than through actual videogame sales.
Is Gamification the Future of Online Gambling?
In an ironic twist, the gambling industry is now taking inspiration from the videogame industry, and have begun “gamifying” their online casinos. Just as the videogame industry copied gambling elements from casinos, casinos have now copied “gaming” elements from the videogame industry.
As a result, many games offered by online casinos and gambling apps are much more involved than simply pressing a button, and watching numbers or virtual dice roll. These days players can battle enemies, earn “experience points,” and level up as they play. Similar to earning tickets at in a game room, a player's score and experience often determine their payout, or can be traded to play mini games that give them a chance at wining real money.
Even in online casinos that stick with traditional games such as slots, they now often have a mechanic where players earn points or level up as they play, allowing them to earn bonus rolls, or even a direct payout. The benefits for the casino are obvious: players are incentivized to play more, and ultimately, spend more. This is essentially the exact same strategy that the videogame industry uses with their loot box and micro-transaction business models.
Skill vs Luck
While technically illegal in the US, gambling apps have been a big hit in other parts of the world. The big advantage here is that apps can offer a variety of gaming experiences in addition to the traditional games such as poker, slots, or blackjack. This has opened the door for skill based gambling where players compete against one another in games that require fast wits and reflexes to win.
This competitive system has taken gambling from a mostly luck based experience, to one that involves actual skill, giving players more control over the outcome of their experience. This has proven to be wildly popular as many people would rather bet money on a game in which their skill has a direct relationship to how much money they can win, than on a game where luck is the biggest factor.
Online Gambling Reimagined
While Millennials have traditionally not been very interested in gambling, and GenZ is still a bit too young to gather data on outside the realm of loot box type systems in videogames, the future is looking bright for online casinos. The gamification of online casinos, and the distribution of videogame style gambling apps where they're legal, have introduced the excitement of online gambling to a whole new audience. Going forward, the gamification business model will likely continue, keeping players playing, and keeping gamers gaming.