When Win COO Yaniv Leven looks at the social casino space, he sees plenty of competition in the slots and bingo games his company produces, but he also sees a huge opening in the lucrative world of sports betting.
Leven and Win hope to jump into this space in early 2014, looking for fans who talk trash about each other’s favorite soccer clubs to put their virtual money where their mouths are, tracking results as you bet on the biggest games each week in the real world, even enabling gamers to bet their fake currency in simulated match-ups when there are no real games to be played.
I sat down with Leven in New York last week after he spoke at the Inside Mobile Apps conference to get the dirt on his new betting game, the rise of social casinos, and Win’s proprietary analytics platform, Winsight.
Inside Mobile Apps: Where do you see Win’s place in the social casino landscape?
Yaniv Leven: Win was formed about a year and a half ago by bwin.party. Bwin.party is the largest online gambling company, but they were late to social gaming. They really saw social gaming as a growth opportunity, but because they came into it so late, when they came out, they wanted to come strong since a lot of companies like Caesars were already there. So they made a a very aggressive $50M investment with us, giving Win the authority and capabilities to build every one of the social gambling genres. Part of that investment was the acquisition of a development company from the Ukraine called Omeon, who had worked on online gambling tools before. In the past year we’ve built an application for each one of the gambling verticals, except for poker, as poker is the only niche that we haven’t touched yet. All of our applications are showing steady improvement in KPI, and at this point we have our retention where we want it to be in both slots and bingo. Our sports application is coming out in Q1 2014, is a big one for us. No one in the social space has conquered sports betting yet.[contextly_sidebar id=”065b87fc09dec80f70e597bfdd0963b4″]IMA: Sports betting is such a huge piece of the Vegas puzzle, why do you think nobody has done it right in social yet?
YL: It’s huge, but there are a couple of other places that haven’t been conquered yet as well. Horse racing is huge and is over a billion dollar market in France alone, but nobody has attempted to touch it. I think these kinds of applications, with the industry they’re in, they suffer from a liquidity of items. There aren’t enough sports events throughout the day to keep the users coming back all the time. In a social gaming application, you need users inside the game all the time in order to be able to convert and to be able to keep them engaged because every moment they’re not in your game and they’re online, they’re in another game. So what we’ve done in the sports application is we’ve partnered with Top Eleven, utilizing our betting engine and the Top Eleven simulation engine to create a sports app initially around soccer. What we do is, aside from real matches that you can see online live, and bet whatever you can bet in regular betting events, we’ve also adding a simulated betting engine to simulate matches so all the time there will be matches inside the game. At any point in time, you can come into our game and bet whatever you want in simulated matches. We’ve also made the application social so you can bet against your friends and see the progress. This kind of application is tailored directly to the Top Eleven soccer fanatics.
IMA: What do you think the draw is in playing slots for virtual currency. If I’m in Vegas, I’m hoping to win big. Why are people so addicted to playing slot machines when no real money is involved?
YL: I think when you go to Vegas, if you’re a real slots player, you don’t go to win the jackpot. You go to play slots, and if you do win the jackpot, you use that money to continue to play slots. When you interview slots players, they’ll tell you, they’re not playing for the cash. Intrinsically, they know, over time, they are going to lose that money. Instead, they are playing to get into that zone, or what is known in psychology as Flow, which is basically when you are doing an action that you are so intrinsically focused on, that the perception of time fades. In studies, long distance runners feel the same way, and I’m a long distance runner, and I can attest to this. When I’m running, the only thing I want to do is take that next step, which leads to the next step, and it brings you to that steady pace. Flow is that place you stay in as long as you don’t get frustrated and as long as you don’t get bored. As a slot player, as long as you’re not getting too frustrated by the game, and you’re not getting too bored, and all that has to do with the math of the machine, but as long as they keep you in that Flow, you’re going to keep playing. So in that sense, there is no difference between Vegas slots and social slot applications. The thing is, with the social space, because there is no cash back, our hold can be much better than the live casinos, and people will spend even more time playing online slots than they ever would playing offline.
IMA: Since it’s not real money, do you manipulate the payouts in social slots to keep people in that Flow?
YL: Since it’s not regulated, you can do that, but in our games, our math is pure. If our games were regulated, the math of our machines would enable them to be in Vegas and pass full regulations. Our math is pure. Theoretically you can do what you say, but in our case, that’s just not the case. If you have good math, iif you did the art and sounds right in the game, in more cases than none, you don’t need to manipulate anything.
IMA: Do you see more people willing to spend real money to play virtual slots than are willing to spend money on other social games?
YL: The industry standard is like 2-percent monetization, but in the social casino space, we see higher conversion rates. What we see more is, not only are the conversion rates higher, but the lifetime value of the user is significantly higher. When it comes to ARPU, the industry standard is $0.08, maybe $0.10, but in social casino we’re seeing $0.40. It’s crazy.
IMA: How does your WinSight analytics platform help you guys build better games?
YL: When we began building our company, one of the key things we were looking at, in terms of this data driven industry, is we looked into getting as much as we could out of our data. We looked at third-party applications, but we couldn’t find any solution out there to give us the overall coverage we needed, so we outlined what we needed and we went out and built WinSight on our own. WinSight give us coverage of all the stuff we need in almost real-time. Our system gives us access to all of our data, and it helps us process over 100 million events, while giving us access to all of this raw data for our analysts who are data mining. It’s a fully functional system for any analytical needs that we have, rather than having three different systems an trying to piece everything together. WinSight gives us the full solution so our analysts can see exactly what’s happening in our games. It’s pretty amazing. Seriously, there’s nothing out there that even comes close to providing this source of analytical solution.