internationalcasinoreview


JoaCasino Uriage east of Grenoble in the shadow of the Alps


Interview


Rebalancing the casino experience both on and off the gaming floor


JoaGroupe, with 20 casinos, is the third largest operator in France, itself Europe’s largest casino market. Under the leadership of CEO Laurent Lassiaz, the company has taken bold moves to reinforce its position in order not only to withstand the strong winds that have blown across the gaming landscape in the last few years but also use them to drive its business. It is now considered France’s most profitable casino operator by ratio. As Lassiaz tells Hugh Sorrill, the company has made some surprising decisions, including a reduction in the machine park and greater emphasis on table games. Another key element is the promotion of gaming alongside other activities, transforming the casino into an entertainment centre more than a gambling house – a move that operators in almost all the major European markets are keen to make.


newapproach INTERVIEW


Casino Review: What is the state of the French market currently in your opinion? Laurent Lassiaz: The market is in the process of stabilising after what’s turned out to be three years of contraction: in 2008 the anti- smoking law was put into place and in 2009 we had the impact of the economic crisis. In 2010, the first half was negative and the second level or just above – zero-plus as we call it.


My analysis is that we have probably


reached the low point. Now little by little, activity will increase, something what we have been noticing for several months now. There are more and more casinos that have started back on the path of growth.


CR: Does that mean in terms of visitor numbers, turnover or both? LL: Both – but the relationship between the two has changed. Now if you want to see an increase of five per cent in terms of GGR, you have to record an increase of ten per cent in terms of traffic because the average spend per guest is decreasing. If you want to record any growth in GGR, traffic has to be at least five per cent up. That’s the ratio. It’s a direct effect of the economic crisis in that people are spending less money.


CR: What about the state of the market on the Mediterranean coast? Is the perception that the market has suffered more there than else- where in France justified? LL: One reason is simply numbers: it’s the region that has the most casinos. The impact of the smoking ban on the Mediterranean market was similar to that in the rest of the country, however the impact of the eco-


44 February 2011 • interview


LL: It’s still a bit early to tell. It’s still a very fragile market. But it’s also a market where there is a lot of competition. There is a high density of casinos, so it will need more time to regenerate.


CR: How have all these influences affected JoaGroupe? LL: It’s suffered the same effects as the rest of the market. But in addition JoaGroupe was the group that turned out to be the most exposed to the opening of new rival casinos. So for us, the effects were doubled. The eco- nomic crisis affected our basic business we also had strong competition with new licences awarded in the area where Joa- Groupe had originally dominated. The most recent examples are in Toulouse for example, and Blotzheim, near the Swiss border and Basel. There are new casinos [opened by Bar- rière] in these cities that have had an impact on our turnover.


But while that has been difficult for us,


there has been a good side to it, in as much as it forced us to develop a business model that is fit for the current business environment. And that is what we have been doing in 2010.


Laurent Lassiaz, CEO of JoaGroupe has instituted a new business plan with entertainment the keyword of the offer


nomic crisis was much greater, mainly due to fewer foreign visitors visiting. It’s a vacation destination, and the high rollers from China and Russia were not coming in the same numbers as before.


CR: Is it picking up again in the south like the rest?


CR: What is the result of your work on the business model? LL: We undertook a complete renovation of the business model, working on five axes. The first axis is how we define the ideal size of the offer in terms of slot machines per casino, with the result that in a quarter of our casino estate we have actually reduced the number of slot machines in order to address questions of productivity.


CR: When so many casino operators want the right to operate more slot machines that’s a


surprising move; why have you done it? LL: It’s like in restaurants: people are more likely go to restaurants where there are more people. Similarly a largely empty slot floor is much less attractive than a much busier one; the more a slot floor is busy, the more is played and because the machines are played more, the prizes fall faster and so become more attractive for players. We have exam- ined our slot floors and decided on sizes that are better adapted to the level of visitors we are currently welcoming and to the type of target audience for slot machines. That’s the first way we’ve reworked the business model.


The second is the total re-engineering of


what we call our peripheral activities, such as our hotels, restaurants, night clubs, cinemas and bowling alleys. We’ve now relaunched many of them and are seeing very strong growth from them. So, for example, three quarters of our restaurants have now been refurbished; we’ve doubled the size of some of our nightclubs, updated our cinemas and also built bowling alleys.


CR: Bowling is not an activity that most people associate with casinos. Why did you go for bowling alleys? LL: It’s part of the JoaGroupe strategy that says we are not solely a destination for people who like to gamble, but rather a leisure des- tination. We want to be able to welcome people who are coming for a party, or for a drink, or to celebrate a birthday, even if they are not a casino player. This is a strategy designed to broaden the clientele. Its main aim is to create an opportunity to visit a casino for someone who has never been before. In France the rate of penetration by casinos among the target adult audience is


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