The see-saw battle between clubs and pubs for gaming revenue continues with the recovery from COVID-19 still having an impact, the latest figures from Queensland and NSW authorities show.
While taking into account L&G NSW data for the non-corresponding period for clubs and hotels and adjustments for the closures between 23rd March and 1 June 2020, the total market for NSW club and pub gaming grew 5.4 per cent, from $6.281bn in 2017 to $6.623bn in 2019.
But NSW club revenues barely grew over that period, meaning that the sector lost market share to pubs, from 62.8 per cent in 2017 to 59.9 per cent in 2019, data analysis by Geoff Wohlsen of Wohlsen Consulting indicates.
Club’s share of gaming fell again over the 2020 period – impacted by COVID closures and restrictions – to 58.5 per cent.
Mr Wohlsen said the NSW data for the first quarter of 2021 (although for slightly different periods but an equal number of trading days) shows a bounce back in market share to clubs, at 60.6 per cent. This reflects the trend in Queensland, where clubs also gained share over the post-COVID period.
“Another interesting point to note is the average machine performance at clubs compared with hotels, measured by average daily net revenue (ADR) per machine,” Mr Wohlsen said. “ADR for hotels was around 1.7 to 1.8 times the club average in 2017. But in late 2019 and during 2020 it ramped up to over two times, and in fact was as high as 2.8 times in 1H 2020.
“The ratio has settled in 1Q 2021 at 1.9. But the fact remains that machines within pubs work a lot harder than those in clubs.”
In Queensland, OLGR numbers for Q1 2021 found an average lift in machine gross revenue (March 2021 v March 2019) across the two sectors of 9.5 per cent, representing an annual figure of 4.7 per cent. This comes from a 10.7 per cent gain in clubs and 8.3 per cent in hotels.
Wohlsen Consulting’s analysis shows that when Queensland venues reopened in June after the shutdown, there was a rush of people back to pubs, pushing their market share in gaming to 62 per cent –followed by a crash that took share back to levels not seen since 2017.
Wohlsen suggests there were potentially several pandemic-related factors at play in both states. Pubs – with sit-down drinking and many of their usual drawcards on hold – could simply not be what many of their younger patrons wanted them to be.
“Bigger clubs had budget and wherewithal to create a safer environment,” Mr Wohlsen said.
Many larger club venues with bigger budgets also allocated greater resources to the COVID-19 environment, to satisfy the aged and virus-wary, such as QR code check-in and temperature checks, plus greater distance between machines. EGMs were also less likely to be decommissioned due to challenges in achieving mandated distancing.
“A good number of larger clubs really embraced all these things and did it well,” he said.
“The thing I like about clubs is after about 150 (machines) it starts to look pretty casino-like. They can play with a lot more signage than a hotel can, across 30 machines.”
He says good operators such as Dooleys Lidcombe, in Sydney, have signage that is “magnificent”.
“It really is high quality, interactive, and very much a casino look,” he said.
Wohlsen Consulting provides professional consultation on a range of concerns within pub and club venues, including governance, member research and cultural training.