More digital to react to Covid-19

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Will the coronavirus emergency permanently change gaming habits globally? Here is the analysis by Mauro De Fabritiis, founder of Mdf Partners, which also illustrates the possible strategies to be implemented for both the land-based and the online gaming

by Mauro De Fabritiis Mdf Partners, founder

The spread of Covid-19 is generating significant impacts worldwide and producing changes in consumption patterns and lifestyles that will probably remain changed, even after the supposed “return to normal”. The stop of transfers and social distance, imposed as

measures to combat the pandemic, have made us aware of the economic interdependence existing between the various countries and the critical issues that the spread of the virus entails in all economic sectors. Tourism, transport, food service, physical entertainment and automotive were the sectors most affected and those that will

probably restart last and consequently suffer the worst losses in economic terms. The pandemic affected the entire world

economy, focusing on four sites: China (Hubei), East Asia

(South Korea, Japan and Singapore), the Middle East (Iran) and

Western Europe (Italy, Spain and France). In addition, while the situation in China has stabilized with the implementation of extraordinary public health measures, new cases are emerging elsewhere, including Latin America (especially Brazil), the United States (New York State, California, Oregon and Washington) and Africa (Algeria and Nigeria), suggesting a delay in the times for the global economic recovery. The gaming sector: still early to make predictions Gaming with money winning sector will have longer recovery times than others, following, on the one hand, the fact that much of the industry is tied to the world of physical entertainment and, on the other hand, to the negative meaning and to the social uselessness that characterise it both politically and in public opinion. Worldwide, the sector moves around €450 billion of expen

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diture, of which about 90 percent via land-based places - gaming rooms, betting shops, bingo halls, casinos, racecourses, bars - which will follow re-opening plans decided by the various governments and with adaptation measures in order to preserve the distances between people and avoid gatherings, similar to those followed for other sectors of physical entertainment (cinemas, theaters, concerts, etc..). The stigmatization of the sector, despite the fact that it assures significant employment levels and revenues for the state, will penalize, however, the speed of the recovery plan, also following the difficulty in obtaining state funds, indeed guaranteed for other sectors. The impact of Covid-19 will be heavier for the physical gaming compared to the online gaming which, although affected by the reduction in sports events and the economic situation, will benefit from the favorable situation that is characterizing the various sectors of e-commerce. It is difficult to make predictions in a context that changes daily, but the facts related to the first quarter of 2020 provide us with some indications. The closure, at the international level, from midMarch, of the main physical gaming stores and the absence of sports events, will compromise the results of the year for most companies operating in the physical sector, mainly following the reduction in spending on gaming machines and bets. However, as regards the online there is an increase, albeit limited, in casino games, poker, especially in tournament mode, virtual games and, albeit marginal, esports. A possible sign, the latter, of a change in the attitude of players, who are rediscovering in this period of uncertainty and caution in purchases, gaming forms with lower entertainment costs and more related to fun than to the game itself. Online spending at the end of the year, hypothetically compromised by the pandemic, could improve compared to 2019. The final result will depend on the restart of sporting events which represent in most countries about half of the expenditure.