The document summarizes the development of Community Gaming Centres (CGCs) in British Columbia as a new entertainment brand. It describes how CGCs were created in 2004 to meet growing demand for slots while maintaining responsible gambling in a differentiated facility model compared to casinos. Four cornerstones guided the vision: exciting facilities, product variety, remarkable guest experiences, and effective marketing. While alignment issues arose between BCLC and private sector operators, the CGC model achieved revenue growth, increased participation, and public support for gambling in BC.

1. Building a New Entertainment Brand:
The Story of Community Gaming Centres
Canadian Gaming Summit - 20 April 2011

2. Building a New Entertainment Brand
BC’s Model
Flashback
Envisioning a New Future
– Four Cornerstones
20/20 Hindsight
– Issues
– Successes
– Regrets
– Results

3. BC’s Model
Gov’t Gaming Policy & Enforcement Branch is the regulator
for all gambling in BC (commercial, charitable, horse racing)
BCLC is a provincial crown corporation with responsibility to
conduct and manage commercial gambling:
– Lottery (1985)
– Casino (1997)
– Bingo (2001)
– CGCs (2004)
– Internet (2004)
BCLC has long-term contracts with private sector companies
for Casino/CGC/Bingo operational services and facilities

4. BCLC: Net Win Growth
$18.0 $2.5
$16.0 $15.20 $15.40 $15.00
$14.70 $14.80
$14.10
$13.40 $13.40 $2.0
$14.0 $2.03
$12.80
$1.95 $1.94
$12.20 $1.91
$12.0 $11.00 $1.78
$10.00 $1.61 $1.5
$10.0 $9.00
$1.40
$8.00
$8.0 $1.25
$7.10
$6.40 $1.14 $1.0
$1.03
$6.0 $0.94
$0.89
$0.75
$4.0
$0.5
$0.46
$2.0 $0.38 $0.38 $0.41
$0.0 $0.0
95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11
CANADA BC

5. BCLC: 2011 Net Win Projections
$464.9
Lottery
$16.0 eGaming
Community Gaming (slots)
$166.9
$1,339.3 Bingo
Casino
$39.3

6. Building a New Entertainment Brand
Flashback

7. State of the Industry: 2001
Industry initiative to turn around dying business and
protect charities; BCLC manage & conduct
32 Bingo Halls around the province
22 Service Providers (many were charities)
3-4 Bingo Halls on the brink of closure
Negotiating for territories; new agreements
Model did not preclude charities from continuing as
Service Providers
By 2003, BCLC/Industry jointly exploring future models

8. Flashback to 2004: Perceptions
Bingo players said….
Bingo is a social ritual that’s important to me, “Bingo could
but far short of ideal. be more
“You should be entertainment
“Get away from allowed to based , rather
Cheese Whiz socialize while than just a
poured over you’re playing.” sterile room.
nachos.” It could be
more fun.”
“We should be treated
less like cattle and more
like valued customers.”

9. Flashback to 2004: Perceptions
Non-players said…..
I can’t see myself playing. “Smoke-filled halls”
“Crummy
prizes”
“Bingo is a
“Boring”
game for
old people
and losers”

10. Flashback to 2004: Ideal “Exhilaration.”
What players and non-players wanted…..
“Freedom,
“Sharing, escape
“Something for humour.” from
everyone. everyday.”
Go as a group,
play some
“Dancing!”
games and “Not too
meet up later dressy.”
for a drink.”
“Having fun,
feeling good
about myself.”

11. Flashback to 2004: Reality

12. Flashback to 2004: Reality

13. Flashback to 2004: Reality

14. Building a New Entertainment Brand
Envisioning a New Future

15. The Challenges
Create a strong business from a dying business
Ensure the new business can compete long term
Mix existing bingo players with new guests
Encourage investment; create attractive ROI for
Bingo Service Providers and BCLC
Align BCLC and BSP visions
Build positive partnerships with municipalities;
create a financial and entertainment asset

16. Strategic Response
New Revenues – use bingo gambling facilities to
meet market demand for slots in a responsible way
Differentiate Our Portfolio – distinguish the CGC
experience from Casino and Hospitality facilities to
improve overall market penetration/participation
Reinvent the Experience – create broader appeal
and compete effectively as an entertainment option

17. Strategic Response:
New Revenues – Meet Slot Demand
8,000 slots in BC; market demand for 14,000+
Bingo model not viable
Casino model not feasible
VLT model not desirable
Bingo halls in BC already offered gambling
Municipal participation in gambling revenues
Community Gaming Centres were born:
– Lower cost operating model (vs. casinos)
– New/Different standards for staffing
– Maintained gambling integrity and player safety

18. Strategic Response:
Differentiate Our Facility Portfolio

19. Strategic Response:
Reinvent the Experience
Four Cornerstones:
1. Exciting, inviting facilities
2. Product variety
3. Remarkable guest experience
4. Effective marketing

20. Four Cornerstones:
1. Exciting, inviting facilities
Vision:
• 16,000 to 25,000 sq. ft. on a single level
• Enter through lively slot zone, transition thru lounge and e-
bingo, quiet zone for paper bingo
• Quality F&B amenities; space for group events
• Small stage (100-200 sq. ft.)
• Moderate facility investment
• Most $9M - $11M
• Range $4 - $19M
• Facility Development Comm’n

21. Exciting, inviting facilities

22. Flashback to 2004…….a reminder

23. Exciting, inviting facilities

24. Four Cornerstones:
2. Product Variety
Vision:
• Bingo – paper, electronic, linked, personal play
• Slots – 50-225, lower volatility/denoms/jackpots
• Tables – electronic only
• Lottery – Lotto, Keno, S&W
• Horse Racing - teletheatres
• Interactives, Multiplayer
• Signage – more subdued

25. Product Variety

26. Four Cornerstones:
3. Remarkable Guest Experience
Vision:
• Friendly, personal service
o Chances Customer Service Standards
o Customer Service Training Kits/Modules
• Well-priced, quality food & beverage
o White Spot comparable
• ‘Winnertainment’
o Game Shows
o Musical Bingo
o Lightning Bingo
o Contest Vignettes

27. Remarkable Guest Experience

28. Four Cornerstones:
4. Effective Marketing
• Shared marketing roles:
o BCLC supports provincial player development
o SPs support local player acquisition and loyalty
• Common brand to compete for share-of-voice
• Graphic Standards/Templates
• Chances brand positioning:
“Chances celebrates
the thrill of winning, great food
and hours of fun with your friends.”

29. Effective Marketing

30. Building a New Entertainment Brand
20/20 Hindsight

31. Issues
BCLC and SP alignment
- Managing expectations
- Vision (lack of long term view, requirement to invest)
- Slots (number, need for facility upgrades, selection)
- Compensation, contract terms
Access to capital (charity-owned SPs)
Chances Brand: preserve sense of ownership/independence
and desire not to become a ‘franchisee’
Municipal approvals: initial reticence but Service Providers and
charities were very successful in engaging communities
– problem gambling, crime, policing costs, revenue-sharing, public
acceptance

32. Successes
Player participation and support in small markets
Overall market growth, limited cannibalization
Vision achieved: Four Cornerstones
– Facilities: 15 CGCs, 4 underway, 10 Bingos remain
– Guest experience: F&B, ambience, service
– Variety: products, winnertainment, amenities
– Effective marketing: Chances brand, BC Gold
Municipalities now seek CGCs (new, relocations)

33. Regrets
Underestimated change management
New operations requirements overwhelmed SPs
Compensation
Contract structure
Over-built bingo floors
Several SPs over-leveraged
No SP downside for delays in build-outs

34. Results
BCLC: CGC revenues $275 Million
SPs: annual commission/investment 13-32%
Slot cannibalization of Bingo met projections (22%)
Player visitation increased by 50%+
Player satisfaction (77%)
Public support for gambling remained steady
Municipal revenue-share $8 Million per year; plus
tax revenues, employment, economic spin-offs

35. Community Gaming: BCLC Net Income
$100
$91.2
$90
$81.1
$80 $76.2
$70
$63.2
$60
$50
Net Income
$40 $36.7
$30 $27.9
$18.8
$20
$10
$-
2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11

36. Building a New Entertainment Brand