In the fast-paced world of iGaming, one thing is becoming clear: if you’re not on the AI train, you might just get left behind at the station. As operators scramble to enhance player engagement and fine-tune their marketing strategies, predictive AI has emerged as the superhero of the industry. Forget the generative AI buzz. Predictive AI is where the magic happens, and it’s shaking things up in ways that are both exciting and essential for future growth.
The shift from generative to predictive AI
During an enjoyable conversation with Staffan Engstr?m, the CEO of Fieldstream AI, he discussed the industry’s evolving perspective on AI. “Our main feature is predictive AI and not generative AI. Many people think AI is mostly generative, but it’s a big industry. I think the applications on the predictive side are where the real value is,” he explained.
Engstr?m, started a consulting business and built an AI model scanning 600 brains with Stanford University. It was one of the world’s largest neural models. He felt he should try building a prediction model with large data sets using business data.
Having witnessed the profound changes that predictive AI can bring, he added, “I soon realised that there was a negative correlation between clicks and brand value. With long-term business value, that was unheard of.” The realisation? Clicking isn’t king anymore. Engagement is the royal decree.
As operators shift their focus from mere clicks to meaningful interactions, the question arises: how do you keep players engaged? Engstr?m highlights the value of grasping the entire customer journey rather than solely concentrating on the final steps. “You trigger someone’s curiosity way, way, way earlier,” he smiled, highlighting that the marketing focus often ends with the signup, ignoring the earlier sparks of interest.
A holistic approach to customer engagement
This holistic view is where AI truly shines. Engstr?m’s analysis shows how predictive algorithms can bring together different marketing sources to construct a unified narrative. “Our algorithm connects all the marketing sources to one true story and a holistic truth,” he said, hinting at the idea that the whole is greater than the sum of its parts. This approach allows companies to measure engagement at every stage of the customer journey, from that first intriguing ad to the moment a player hits ‘play’.
With predictive AI, operators can now create a more tailored experience for their players, leading to increased loyalty and a healthier bottom line. After all, who wouldn’t want to be treated like a VIP?
The unsung hero of iGaming, data analytics
In an industry where marketing accounts for nearly 40% of revenue, data analytics have never been more critical. Engstr?m pointed out, “Marketing is almost 40% of all your revenue for iGaming; enormous amounts.” With such high stakes, the last thing operators want is to throw their money into a black hole of ineffective advertising.
By harnessing the power of AI, companies can maintain control over their data sources, ensuring compliance with regulatory requirements while building trust with players. “Once you get full control over where the marketing actually goes, it’s very easy to follow governmental regulations in terms of where the money has gone and who the receiver is and where the results are coming from,” Engstr?m noted.
So, what does this mean for operators? Well, it’s a chance to step out of the shadows and promote ethical practices. With increased scrutiny from regulators, especially the ongoing arguments of the failures of self regulation in the gambling industry, adopting transparent data strategies is not just smart; it’s essential.
A double-edged sword
People often view emerging markets as the wild west of iGaming, offering plenty of opportunity but also presenting significant challenges. Engstr?m candidly discussed the obstacles, stating, “To build effective AI, you need historical data, which you don’t have in emerging markets.” But don’t let that dishearten you; he suggests starting the data collection process from day one.
“The opportunity exists to create efficient models that can adapt and grow as more data becomes available,” he encouraged, underscoring the importance of a proactive approach. In this ever-changing landscape, those who act swiftly can establish a strong foothold and reap the rewards of a data-driven strategy.
The ethics of AI and the call for responsible gambling
As we navigate the world of AI in iGaming, ethical considerations surrounding its use are of utmost importance. Engstr?m passionately advocates for AI’s potential role in promoting responsible gambling. “iGaming could really be at the forefront of driving behavioural medicine because it is an addiction, and these mechanisms have never been studied this in depth before,” he stated. “Now, we can really make a difference. He alluded to the big operators, the regulators and policymakers getting together to look at addictive behaviours in an efficient way.”
The conversation around responsible gambling is more than just a trend; it’s a necessity. With AI’s ability to analyse player data, operators can identify patterns and implement measures that encourage safer gaming environments. “There should really be a common interest for both government and operators to dig into this behavioural data together,” Engstr?m argued, calling for collaboration that prioritises player welfare while supporting business objectives.
In a landscape where addiction can be a devastating issue, embracing ethical AI practices isn’t just good for business, it’s essential for the industry’s reputation.
A new era for iGaming?
As the iGaming sector marches forward, integrating AI presents a glut of opportunities. From enhancing player engagement to streamlining marketing efforts, the benefits are obvious. Engstr?m’s insights emphasise the transformative power of AI in shaping the future of iGaming, but the road ahead is not without its bumps.
With regulatory environments evolving and player expectations shifting, companies must remain agile and responsive to the changes. “The AI revolution is in its infancy,” Engstr?m noted. As new technologies emerge, operators will need to adapt and innovate to stay ahead of the curve.
Image courtesy of Staffan Engstr?m
The challenge for industry leaders is to embrace the full potential of AI while maintaining a commitment to ethical practices. As Engstr?m aptly points out, “You know what needs to be solved.” Once companies realise this, they can harness the power of AI to drive positive change.
The iGaming industry stands at the precipice of a new era, with AI poised to redefine how companies engage with players and manage their operations. By embracing predictive AI, operators can move from insights to impact, crafting experiences that resonate with players and foster loyalty.
In a world where data is king, the future belongs to those who can harness its power ethically and effectively. As we look ahead, let’s hope that the iGaming industry will not only embrace these advancements but also prioritise responsible practices that ensure a safe and enjoyable gaming environment for all.
Finding the ‘lightbulb’ moment
Engstr?m embraces the ‘lightbulb moments’ when he finds something that truly works because, as he says, “all these years of preparation, all these university studies, all this grind, all this curiosity, all the people say now you, you know this will never work.” So when it works, it’s thrilling.
Staffan Engstr?m offers invaluable advice for those stepping into the AI landscape: “Don’t ever be impressed by power. Be impressed by knowledge.” This perspective highlights the significance of prioritising learning over authority. He urges newcomers to “study, take classes, test your thoughts,” and “dare to be wrong.”
Engstr?m emphasises that this mindset is crucial for building a firm foundation. He warns that if one tries to become a power person, “the wrong people will lead you.” Instead, he advises aspiring professionals to focus on “building your knowledge base day in and day out.” This commitment to continuous learning is essential for navigating the complex challenges of the AI industry.
When asked about how he unwinds at industry events like the upcoming SiGMA Malta 2024, Engstr?m quipped, “You need to be really prepared for going into them because once you get in, there’s so much happening.” He humorously compared the experience to “running blind with a million different tracks to take.” As he reflected on the importance of strategic networking, he added, “This is for me just to go out and spread the gospel about what we’re doing, and driving sales,” His light-hearted yet intensely focussed perspective serves as a reminder that amidst the chaos of industry gatherings, preparation and genuine conversation will make all the difference.
About Staffan Engstr?m
Staffan Engstr?m is the CEO of Fieldstream AI, a pioneering company focused on leveraging artificial intelligence to optimise user experience and operational efficiency in the iGaming industry. With a wealth of experience in the sector, Engstr?m is committed to driving innovation and ethical practices in this rapidly evolving landscape.
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