The Disruption of the Arcade Industry

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What have we learned from COVID-19’s disruption?

Pretty much exactly one year before COVID-19 ravaged the United States, we wrote an article about intentionally disrupting your business operations to grow, reinvent, and look for new opportunities.  What ended up happening isn’t something we could have ever predicted, and we got some chills reading back upon our own statement: “Sometimes disruption happens outside of our control and we must adapt to it.


The disruption of the arcade industry

We decided to revisit this article with the new outlook we’ve gained from living through a worldwide pandemic, and refocus it back to business operations for rebuilding, regrowth, and renewal.  Some of the content has been left untouched so we can look at the sobering contrast of the world we used to live in, but we’ve attempted to amend the article with practical advice and insight on moving forward in ‘the new normal‘ (ironically another article we wrote almost exactly 1 year after our article on disruption original article mentioned above).


FECs and arcades are still well
positioned as an entertainment option.

For a moment, let’s set aside the fact that most businesses were forced to shut their doors when COVID-19 hit. When the community transmission of a virus is the greatest threat to a community, what guest would even want to go to a venue where all you do is touch things? Arcades and FECs were some of the businesses that got hit the hardest.

However, while arcades may not have been well-positioned for a health crisis, they are still well-positioned (possibly even better than before) as an entertainment option.

One of the things that is so important to us as human beings is social connections, and it’s one of the things that makes the arcade industry so rewarding to be a part of.   You have the ability to offer guests a truly social experience at an affordable cost, so keep your eye out for any opportunity you have to engage your guests.

Many of the first locations to re-open reported higher revenues than the same time on the previous year!  There is a light at the end of this tunnel, so stay positive, and stay connected.


Now might be the time to consider a card system.

The polls, surveys, and reports that have come out over the last few months all point to major changes in consumer expectations and behavior.  With guests and businesses alike looking for opportunities to reduce physical contact where possible, what better way to facilitate transactions at the game than with an Arcade Debit Card System. Debit Card Systems have changed a lot since they became widely accepted a little over a decade ago, so if you haven’t looked at them for a while, maybe it’s the perfect time to reconsider.

Debit Card System

Debit Card Systems provide a wide range of benefits

For a list of the range of benefits a debit card system can bring to your venue, please see our original article.


Virtual Reality (is still) the next big thing.

2020 was supposed to be the year that VR went mainstream but it hasn’t lost any traction, and guest behavior has shown that it’s still the most popular format in venues that are able to re-open.  LAI Games Virtual Rabbids was a game-changer and it is continuing to report incredible earnings for locations that are able to resume normal operations.  If you operate The Big Ride, take advantage of The Virtual Rabbids Hygiene Kit, an industrial-strength solution that builds guest confidence around public health concerns. Hardware upgrades and replacement parts address equipment cleaning between each use and puts the power to follow best practice hygiene in the hands of your guests.


Virtual Rabbids Hygiene Kit Virtual Rabbids Hygiene Kit Virtual Rabbids Hygiene Kit Virtual Rabbids Hygiene Kit

“In a recent survey of 22 clients with Virtual Rabbids: The Big Ride, the game was #1 in all but one of the locations, and #2 in the last one. The average percent of sales is a whopping 8%. This is a statement on guest VR acceptance, even during the pandemic.”

– George McAuliffe, President, Pinnacle Entertainment Group


It’s a Critical Time to Revisit Your Marketing

Marketing, whether it’s inside or outside your venue, is responsible for a huge part of your success and is an area where many operators have the capacity to reinvent themselves.  With people spending more time than ever on social media during the pandemic, the opportunity for engagement was unparalleled.  Make sure you’re actively building and engaging your audience, they’re out there.

How actively are you marketing your games?

Your new game may not be as obvious to your guests as you think it is, and if you’ve made the decision to invest in new equipment right now (which most locations admittedly haven’t) make sure to capitalize on it.  New games are the #1 influencing factor as reported by guests as to what will incentivize them to return to an arcade.   You should be advertising your new games on your website, social media and in-store on your TV displays.

Virtual Rabbids Media Kit

Print pull up banners, posters or counter signs so people see your new games and seek them out. Having advertising inside your venue also encourages repeat play. LAI Games makes Media Kits for many of its games and is always happy to help our operators with marketing support.  Reach out to if you want to find out how we can help your team market our games more effectively for you.

There is always room for growth, so take a good look at your marketing, and ask yourself these 5 simple marketing questions.

Attract new audiences with social media advertising .

Social Media advertising allows you to specifically target by region and interest, making it a very effective way to reach people in your area who are interested in your offering.

Email your customers and entice them to visit.

Your email subscription list is one of the best marketing assets you have.  If you’re not actively building it, you’re missing out. Make sure you send out an email or newsletter every time you get a new game in your location.  Incentivize people to come in for another visit with a special offer.

Get your staff involved.

Think of your staff like your customer-facing marketing team. Make sure they’re knowledgeable about all your products and current offers. This applies to all staff, not just certain departments. If you have a restaurant or bar in your FEC, make sure that your bartenders and wait staff know how to talk about the games.  They have the opportunity to create excitement for guests and should be able to talk about all your attractions with confidence and enthusiasm.

Incentivize your staff to proactively interact with customers, and take your guest experience from good to great.  If staff enjoy playing certain games, you have a great exchange waiting to happen!  Staff will be able to genuinely talk to guests about why they like the game, offer tips on how to play it better and genuinely build excitement for your business.


Thinking Outside the Box

This is one of those phrases that we’re all getting sick of hearing, but that doesn’t make it untrue.  Businesses will need to find new ways of generating revenues until operations get back to pre-pandemic norms, and there is no telling how long that will take.

Here are a few ideas and examples to help get your wheels turning:

Consider launching your own virtual experiences, similar to what Main Event did for their chain of FECs.

Sell “boredom buster boxes” to your guests, a concept from our friends at Redemption Plus, which allows you to take advantage of their warehouse of inventory and sell directly to your guests so they can have fun at home.  Talk to Redemption Plus to learn more.

Sell birthday party boxes which include your redemption inventory.  Allow guests to pick them up curbside, and use the opportunity to upsell a card package to be used at a later date.

Utilize a software management system like CenterEdge that can facilitate memberships and offer a ‘Fitness Center Model’ where people can join now with no money for 30-60 days, then pay a monthly membership fee that allows them to come in and play video games whenever they want (consider restricting to video games to save redemption merchandise costs).  This will allow you to accept smaller amounts of money but over a longer period of time.  Considering that most FECs guest visitation rate is only 2.5 times per year, you have the opportunity to get people back to your venue more often where you can upsell them on food and beverage or other offers.

Rent your equipment or your space.  Find out if your local area safety guidelines allow you to hold private events and sell play packages that allow a group to hire your location for the evening.

Offer a free family night and upsell on food and beverage.  It’s important to get people back out and used to the idea of socializing at your venue again.


We wish you a safe, speedy recovery

We continue to wish you the best of luck upon your recovery and re-opening, stay safe, and stay connected.

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