SkyCity honing innovation strategy to remain relevant
Aug. 10 (BusinessDesk) - SkyCity Entertainment Group is honing its innovation strategy, looking at everything from facial recognition to online casinos, in a bid to stay on top of emerging trends, says chief executive Graeme Stephens after presenting his first annual result since taking the job last May.
"We all have to look to the future to make sure we remain relevant," he said. "Our real competition is entertainment, other forms of entertainment. A lot of the new entertainment forms in the world are in that futuristic digital space so, if we are going to remain relevant in the world of entertainment, we also have to understand that space," said Stephens.
SkyCity's board recently travelled to Silicon Valley to see first hand the potential changes likely to impact the gaming and entertainment sectors in the coming years.
"There's a lot of innovation out there and it's not all about inventing it but also about staying abreast of it," Stephens said. SkyCity now has a dedicated innovation team and since Stephens took the helm "there has been greater emphasis on that space, greater gravitas on what that team is doing," he said.
Online casinos could have a direct impact on SkyCity's core business and "it's about when (they come) not whether" he said. "Developing an online strategy, which might encompass an online casino and other forms of entertainment. I think it's the right thing to be doing," he said. "We are not the only ones doing it."
SkyCity's innovation team is not just focused on artificial intelligence and virtual reality but "there are all sorts of innovation in our existing businesses," Stephens said. The team is looking at ways for people to access their hotel rooms and "facial recognition is becoming a thing that's available" he said.
The team is also looking at chatbots, which is when a person phones to complain and gets a robot, something Stephens said not everyone is fond of. They are also looking at different apps that let customers book a restaurant en route and be informed about the length of the queue, the wait time and a possible alternative restaurant.
"The team is tasked with understanding our world, and not just the gaming aspect of it," he said. SkyCity - which has casinos in Auckland, Hamilton and Queenstown in New Zealand and Darwin and Adelaide in Australia - has the advantage of being able to trial different things in its smaller properties first or in certain segments of properties.
"We must become early adopters of whatever is going to improve our business," he said.
On the gaming front, he said any innovation is subject to significant regulatory control before it can be implemented but noted major strides in technology have been made from a gaming surveillance and control point of view.
He said the cards all have unique numbers that are recognised by card readers. It can signal if a dealer has made a mistake and ring a bell in surveillance to put immediate focus on the issue. Chips are all tagged "so you know where each chip is" and the cameras that are being used have incredible detail compared to what they did even five years ago, said Stephens. "Technology is absolutely helping the business."
On Wednesday, SkyCity reported a 1.3 percent increase in normalised net profit to $154.6 million in the year ended June 30, while normalised revenue dropped 4.9 percent to $1.03 billion.
Stephens noted the market was disappointed with the result and said that also "reflects the internal mood." June trading was weaker than expected and that impacted the year. The company said it is expected "modest" growth across most of its business in the current financial year, something Stephens said was "mid single figure growth."
That has "been the trend over the last couple of months. It hasn't really changed much in the first weeks of trading," he said.
SkyCity shares recently fell 0.8 percent at $3.92 and has lost around 17 percent over the past 12 months.