Time for an Arcade Tune-Up!
Strategies to Help Ensure You Don’t Leave Money on the Table
By George McAuliffe, President, Pinnacle Entertainment Group
In our many years managing and advising owners on the management of arcades, we learned how easy it is to leave money (sales) on the table. Most owners don’t realize, and will never know, how much those lost sales add up. We’ve tuned up enough arcades –– dozens and dozens –– to know that the results are plus-10 to -20% (in the best locations) to as high as plus-300%, which was our all-time-best sales improvement after the tune-up process. And, most of that sales increase goes right to the bottom line!
How do you start? Here are a few things to try as you tune up your own arcade.
Games
Layout: A simple, inexpensive trick is to periodically rearrange your games. This is a great way to introduce change at a low cost.
Selection: When was the last time you bought a new game? There are definitely a few new pieces worth buying. Our top three are Smart’s Ticket Ring crane, Andamiro’s Marvel Avengers pusher and LAI’s Angry Birds Coin Crash.
Pricing (Marketing): Periodically examining your price structure is always a good idea. With inflation hitting your business, your customers are used to paying more. Your play card system has “two branches to the tree” –– at the point of sale and at the games or attractions. If you feature a $20 price point on your kiosk, an easy move is to raise that to $25. At the game level, you might consider instituting peak and off-peak pricing. Leave off-peak at today’s price and raise the weekend price by .25 per game.
Maintenance: We all fall into bad habits. Maintenance tuning and deep cleaning is often put off or forgotten. That affects game playability and long-term reliability. Getting cleaning and preventive maintenance programs back on track is a key part of your tune-up.
People
Plans and Systems: We can all learn from the Walt Disney Company. They call an incident of guest dissatisfaction a “tragic moment” and guest happiness “magic moments.” Minimizing the tragic and maximizing the magic takes a plan and a system. They require periodic fine-tuning to deliver consistently.
Mapping the Guest Experience: You set up plans and goals for a great guest experience when you started but, chances are, they need to be refreshed, too! Map your guest’s experience through the various parts of your business to ensure it is at the level you intend and adjust accordingly.
Mapping the Staff Experience: It’s never been more important to invest in our management and employees who represent the FEC brand and deliver the experience you are creating. Digging deeper into their work experience will pay big dividends and catch problems before they grow.
Training Tools: Engaging today’s employees, teaching them the key things they need to know to entertain your guests and doing so with tools and materials that they can relate to is the key. Fortunately, there are great tools available today. We use an app-based, gamified training system that is gaining great popularity in our industry and others.
Merchandise
We always hear about how important a first impression is. But, in the redemption world, it is the last impression that is most important. One of the last things guests do during a visit is redeem their tickets. It’s critical that we are tuned up throughout this process.
Counter or Store: If you use a counter but are in a position to step up to a store approach, this can have a huge impact on improving sales.
Redemption Displays/ Merchandising Systems: Effective merchandising needs a system behind it and that also needs to stay in tune. Factors include:
• Full displays.
• Price points for each item clearly displayed.
• Section prizes by theme such as sporting goods,
inflatables and electronics.
• Display prizes in order of price point whenever possible so that guests can clearly see the prizes they can afford for the tickets they have.
• Display by order of price point has the added benefit of allowing guests to clearly see the next prizes in reach, stimulating them to play more.
• Players fall into one of four categories: Impulse, Trader, Saver and Super Saver. They have roughly equal weight in terms of opportunity for sales. Tune-up time is ideal for ensuring that your merchandise appeals to all four groups.
• Plan Forward: Look at the next six months and plan seasonal changes, adding merchandise sections following seasonal and popular trends.
Cranes & Merchandisers: These are defined as games that dispense a prize directly from the machine to the guest. They have their own set of operating principles to be kept in tune. Perhaps the most important is to change the merchandise mix on a regular basis with relevant mixes playing on seasons or trends. “March Madness” and “Summer Fun” are just ahead. Planning your crane and merchandiser merchandise program will pay dividends.
Controls
As the saying goes, “If you don’t know your numbers, you don’t know your business.” Good system reporting, such as Intercard’s for example, allows you to monitor all the key metrics including employee play, revenue reports, game sales, pricing dynamics and redemption dynamics, just to name a few. Analyzing all of these during the tune-up effort can get you back on track and keep you there!
George McAuliffe has helped hundreds of businesses large and small develop and execute arcades and FECs. He has personally operated family entertainment centers from 2,000 to 150,000 square feet as a corporate executive, entrepreneur and consultant. He is the owner, with his partner and son Howard, of Pinnacle Entertainment Group.
George lives on the Jersey Shore with his wife, Julie. They have three sons, two daughters-in-law and a grandson.
Readers can learn more about Pinnacle at grouppinnacle.com or contact George at [email protected]; phone: 314-422-7197.