Q&A: Where did electronic pulltabs go wrong?

Don’t bet against electronic pulltabs just yet.

That’s what Express Games founder Jon Weaver says. He’s the guy that brought the new games to Minnesota a year ago today. We’re the first state in the nation to try electronic pulltab gambling. Weaver’s iPad devices were the only game in town for the initial months of the launch.

They aren’t working out like state officials hoped and funding a Vikings stadium, although they are paying off in smaller ways. But Weaver says they can still work, for both the state and the charities that run the new electronic games.

Stadium Watch talked to him about the future. Here’s an edited transcript:

Q: First of all, what went wrong here, from your perspective? Why are these games making cents on the dollar compared to projections?

A: I think there were clearly some very good things that happened. Operationally we found there were some impediments to acceptance of the games during the past year, but that’s what happens when you have a brand new product.

Q: What kind of impediments? Technical? Regulatory? Business-related? Competitive pressures?

A: I would say all of the above. I think that we can point to each of those and find areas that we could have improved on.

Q: How about examples? You have about 40 percent of the devices, 80 percent of the sales, in dollar terms. How can you meet those initial projections. It kind of falls on you.

A: I think we could improve on marketing. We’ve all had limited budgets to dedicate to selling these games.  I think we also have to… improve on what we’re delivering to the public, like a game that’s more streamlined for bars and charities.

Q: Does that mean a change to legislation?

A: It’s our goal to work within the existing statutes and rules. Our first goal is not to seek legislative changes for this type of business. But I would say that we need to improve the accessibility to the game. In Virginia, they have an electronic pulltab program that’s very similar. Minnesota and Virginia share a lot of common statutory and regulatory elements. But Virginia is far exceeding sales on a per-device basis over Minnesota. So the question is what are the things that are working in Virginia that we could translate to Minnesota.

Q: Like what?

A: In Virginia, they allow the use of a debit card. They also allow player devices to be housed in cabinets that facilitate the use of bill acceptor technology. I think that those would be two big things that the folks in Virginia would point to that helped guide their success…

The debit cards would require a change in legislation (but) I think we can work within the existing regulatory framework to create possibly more automated kiosk point of sale terminals.

One of our big impediments we found is the style of operation of these games has been an impediment. I’ll give you a great example. Out on Concourse G at the Minneapolis-St. Paul International Airport. They have hundreds of iPads displayed. People are sitting in front of those iPads, and they’re ordering food, they’re checking email… What that demonstrates to me is that people who are comfortable with technology are very comfortable with self-service. A person has no problem going up to an iPad and entering their debit card or credit card number, and ordering dinner in Concourse G. But they may have a problem at Itasca grill going up and asking a bartender to play electronic pulltabs.

There’s just this barrier when you have a human interface. People don’t like to bother a busy bartender and say ‘Here’s $20, I want to play electronic pulltabs. We didn’t realize that these types of operational issues would exist last year. We understand it very clearly now.

Q: Can this marriage be saved in the end — the link between technology and charitable gambling, or are the two traditions just incompatible?

A: Our charities would say not only have they received significant revenues from electronic pulltabs and gambling, but also electronic gambling has increased their paper pulltab sales. So they see kind of a sybiotic relationship between their paper ticket sales and electronics. Those early adopters who have understood and embraced the technology, answering on their behalf, I think they would say this is an important part of their business model moving forward… A rising tide lifts all ships. Everybody has benefited from it, at least at our sites.

  • rarinmn

    The explanations given by Mr. Weaver might have some validity if sales were off by say, 15-25% from projections but not when they’re off by 95% or more. In addition, he provides no reason why sales have been steadily declining on a per device basis. That could easily be explained as people trying the games and then not playing them after that which indicates that they are not as enticing as they were expected to be. That falloff is really where the problem lies, not in an absence of advertising. In a casino, if a game proved to be unpopular it would be quickly replaced with something else and not expanded into more areas. Regardless of whatever happened in Virginia epulltabs would seem to be a losing proposition here, both now and in the future.