The Big Picture Does Not Come Easy
Expanding the Industry World View & Studying History to Set the Stage for Growth
by Frank Seninsky, President/CEO Amusement Entertainment Management (AEM) & Alpha-Omega Amusements & Sales
As we hit November every year, the wider amusement industry prepares for what we used to call the “Parks Show,” the IAAPA Attractions Expo. As the business has morphed and widened, so has this show and in the process, it’s become more relevant to every part of our business, and yes, even route operations. So if you read no further, get this message: You should go to IAAPA.
As to why, part of what I want to say is going to be a little controversial, so here goes.
Throughout my career in this industry, I’ve been involved in AMOA and have been to pretty much every state association meeting there is, and I’m always being told, “The street is tough. We still make our money the same old way we always did where more than half of it is from jukeboxes.” And the next best thing on the street is the crane.
At the same time, some operators pride themselves and actually kind of brag about how they pick up bargain priced games at an auction or somewhere else to put out on location. Their rationale is that these games don’t have to generate a lot of money to be happy with the performance.
That rationale works well enough in some cases, and I’ve got nothing against it, but there’s much more to running a profitable route. I don’t see why they don’t take advantage of top-earning games right away instead of waiting two or three years…or more.
Operators might also go to their state distributor’s open houses to see what’s there, but then again, they only see what the distributors have in their showrooms. Distributors do not have large showrooms any longer. Those days are over and have been for a long time. So, if you don’t travel out of your state or area, you’re in a bubble.
Sometimes your bubble is good because it’s your network and area, but at the same time, you don’t get to see everything new that you need to see. You can read all you want and spend time looking at different games (videos) and trends, but there’s really no way to see the “big picture.” Even my Redemption Report, which tells you what the top new games are, can’t help you fill in all the gaps. This is because small-footprint games that don’t cost much can get overlooked since they’re not going to make a lot of money in a large FEC, but they’re going to be killers –– great revenue generators –– in certain street locations.
thing to consider is that when you go to local events, you might not get the candid information you need most for the simple reason that locally, you’re dealing most of the time with your direct competitors. What I noticed back in the early FEC days – and it’s just as true today –– is that the interaction is “different” when a big FEC invites their competitors to a function. They just don’t share “all” the information. You can be competitors and become friends –– even best friends –– but it’s all different because you’re competing directly with each other. In contrast, when I’m at a Foundations event and have people from all over the country, you find veteran FEC attendees to be much more open with each other and the wanna-bees because they know they’re not competitors.
So, let’s take these ideas and apply them to why you should go to IAAPA. You’re going to be surrounded by people in the industry on multiple levels from all over the world, not just in your own backyard. You might pick up tips from someone else that you wouldn’t run into at the other shows. Just one idea can help your business and make your trip worthwhile.
Also, you’re going to see virtually everything that’s amusement industry related. It’s all there. If you could spend a month going through the products and concepts, you’ll find ideas and learn about products and concepts you’d never see at any other show.
Don’t get me wrong, I’m not putting down any other shows. In fact, the smaller shows where you’re not dealing with 40,000 other people –– like Amusement Expo or Bowl Expo – are great because you can really focus and spend a lot of time with the suppliers, engineers other attendees and really dig down and deep. And at all industry events, there is a tremendous opportunity to network and make new industry friends.
Of course, IAAPA also offers a ton of educational programs. I struggle with finding the time to attend those because I’m focused on spending as much time on the floor as possible so I can see as much as I can. A pre-show planning tip is to look through the seminars online before you go to Orlando and put your must-attend sessions on your calendar so you don’t miss them.
I’ve mentioned just how many people are at IAAPA and it’s well known that the event’s show floor is quite large, but don’t let that overwhelm you or cause you to think you don’t belong. You do!
Over the past several years, IAAPA has made it a lot easier to find the companies and concepts you’re trying to find by using themed sections of the expansive show floor. Take the “Theming & High Tech Pavilion” for example. If you’re looking for VR, you’ll probably find dozens of companies in that zone of the floor. Speaking of VR, this is an area of opportunity for route operators, though it remains to be seen whether they will embrace that entrepreneurial mindset in this regard. For example, an operator could buy VR hardware and software, put them together, rent them and I think they could make additional revenue. Sure, it’s a little different from running a street operation, but it takes the same talents and it takes the same infrastructure. It’s no different than renting games for events, which many operators have done for years and years.
Similarly, consider how great route operators are at running tournaments and leagues. It’s not a great leap to consider adding esports and yet, for many, the concept is completely foreign. To me, esports events are so similar to what they already do it makes sense to consider adding them to the mix. It doesn’t take a lot of money to run these tournaments and find new ways to market yourself. Esports is what I expect to learn more about at IAAPA this year.
And this is really the way you need to be thinking all the time: How is your business going to evolve? This isn’t just true for routes. FECs have to work on service and finding different ways to drive traffic and get customers to visit more often.
So, at IAAPA, more importantly than any one concept, you’ll be able to see where the industry is heading. What are these companies bringing, who are they trying to sell to and why? IAAPA provides a chance to see what’s coming, where your future is headed and where an opportunity might be. If you just stay in your own bubble and do the same things over and over again because you’re comfortable, you’re eventually going to see your business diminish. It’s a simple fact. I see it in my own business. I must spend time looking for new ideas and if there’s anything I wish I had more of, it’s time!
IAAPA is like the World Series. You can almost tell what’s going to be a hit by what’s being sold off the floor. So many operators go to these big shows and make out like bandits because they know no one wants to ship this equipment back. For example, you might find a small footprint game that’s a new, untested and unranked concept that you just know you’re going to make some money with.
Even if you don’t score a deal on a game in Orlando, what you’re going to come away with is well worth the trip from the networking to the new ideas to the greater understanding of the global amusement business that reaches well beyond the equipment you operate today. So, while FEC owners and operators are no doubt going to IAAPA in droves, the smart route operator should go too. Will I see you there? I sure hope so!
Frank Seninsky is president of the Alpha-Omega Group of companies, which includes a consulting agency (Amusement Entertainment Management), two nationwide revenue-sharing equipment suppliers (Alpha-Omega Amusements and Alpha-BET Entertainment), and Alpha-Omega Sales, a full-line game and related equipment distributor. During his 47 years in the leisure entertainment industry, Seninsky has presented nearly 400 seminars and continues to regularly write columns in numerous trade publications. He served as president of the AMOA (and was on the board for 22 years), and was president of IALEI (founding member and on the board for 11 years). Frank is the sole owner of Foundations Entertainment University, now in its 16th year. He is also considered a leading industry expert in the design, layout, and operations of coin-/debit card-operated arcades and FEC attractions, and is often called upon as an expert witness in cases involving the amusement industry. Frank edits The Redemption & FEC Report e-newsletter (35,000+ readers worldwide) and also writes a blog at www. frank-thecrank.com. Frank can be reached by phone at 732- 616-5345 or by email at [email protected] (website: www.AEMLLC.com).