Why are brands important to gambling?
You only need to think about the Las Vegas slot machines to know that brands have always been important to gambling. Brands create what we call, "walk up factor"–players know what to expect, and they like and trust the brand. Online gaming is relatively new and full of potential. Brands are an important part of its expansion.
What makes a brand work well for gambling?
All the major U.K. consumer-facing gambling companies understand the power of a brand and there are usually two considerations: how big the brand is and what elements it has that will work well in a gambling game. But the brand is no good on its own. You can have a very good game with a little-known brand or no brand if there is a good mechanic, good mathematics and great entertainment involved.
At FremantleMedia Enterprises we aim to pair strong brands with good game play. For example, Family Fortunes has elements that translate well into gambling and its values mirror those of many bingo companies–fun, solid family values and the chance to win. Most of our games so far target as broad a demographic as possible to match the wide reaching nature of our formats and TV series.
How big is FME's gambling division?
It has gained a lot of traction in a short space of time and that's why I was appointed to build it. It's now a stand-alone division alongside consumer products. We have also appointed Richard Beach from the gambling industry as product development manager.
Not all FME's brands are suited to gambling. How will you grow?
We are looking for entertainment brands and other IP to take into the gambling category. We have a deal with MGM, for example, to work with films such as Robocop, Legally Blond and The Good, The Bad and The Ugly. But we are also looking beyond TV, film and game brands. As a brand owner, we know how to manage and nurture a brand in a new category, which is reassuring for licensors we might work with.
As well as attracting third party IP, there is still huge potential for additional games with existing brands such as Got Talent, Family Fortunes and Play Your Cards Right, and to strengthen their position in the market.
The U.K. is our biggest market at the moment but Italy and Scandinavia are likely to be very interesting in the future. As (and when) other European territories become fully regulated we will grow into them.
What stands out about FME's gambling division?
Where we differ is in taking a more active role. We co-develop products to retain ownership of them. We are also experts in the field. Gambling is a very complicated space to be in. Complex regulations apply–online gambling isn't legal in the U.S. for example, nor is it fully regulated in every European territory. And it's complicated legally, financially, commercially and operationally so it's not an easy market to go into.
Simon Murphy, head of gambling, EMEA, FremantleMedia Enterprises
Simon Murphy has ten years experience in gambling. It's 10 years in which online gambling has grown very quickly, particularly in the U.K. and Europe, to become a solid slice of the global gross gambling yield (i.e. stakes less prizes) of $335 billion in 2009 and a forecast of $385 billion next year.* Previously at IGT WagerWorks and Million 2-1, Murphy joined FremantleMedia Enterprises in January. Murphy's mission is to grow the gambling business organically with FME's stable of brands such as X-Factor and Play Your Cards Right, as well as by attracting third party brands to take into the gambling space. It is a specialized and highly complex area of business.
*Figures from H2 Gambling Capital.