A closer look: The Rank Group

With two strong UK-facing brands at its disposal, the Rank Group is in the midst of a digital restructure that has seen it target mobile for growth. But is it too late?

This article has been amended to correct some inaccuracies in the original version. eGR Mobile Intelligence would like to apologise to Rank Group.

Although still a business predominantly focused on bricks and mortar, the Rank Group is gearing towards a more digital future with mobile at the forefront. An overhaul of its online businesses, started by former CEO Ian Burke but now led by his successor and former William Hill Online chief Henry Birch, is well underway and the firm’s mobile products are understood to be in line for substantial development.

Talk of a digital overhaul first emerged at the firm’s H1 FY14 results disclosure in January of this year. Burke outlined plans to make radical changes to its online products after its profits slumped during what was a disappointing year. Mecca Bingo, the group’s most known brand, recorded a 40% slump in year-on-year profits for the second six months of 2013, dropping to £6.8m after struggling to come to terms with what Burke coined a “challenging and highly competitive environment”.

While its nascent Grosvenor Casino online business fared slightly better – revenue for the period increased 32% year-on-year to £5.8m – it still only served to reduce its losses by 50% to £0.9m.

Despite the lacklustre performance, the mobile channel increased its importance to the group. Mecca Bingo’s mobile revenue for the period increased 24% year-on-year to represent 22% of total revenue.

And mobile’s prominence grew further in August after the group reported that for the full-year ended 30 June mobile revenues had increased by 43% to £18.9m across the two brands.

With digital, and in turn mobile, central to the business moving forward, the newly appointed Birch recruited former William Hill colleague Colin Cole-Johnson, who served under Birch as the bookmaker’s director of egaming, as its director of cross-channel services to lead the digital revolution at the firm.

The management reshuffle has subsequently continued with Grosvenor Casino MD Phil Urban leaving the company, causing Mark Jones to move sideways from the Mecca hot seat to lead the casino brand. An external hire is being sought to step in as Mecca MD, with Birch currently filling the role in the interim.

“We recognise that we need to step up our capability in the digital area if we are to meet the changing needs of our customers and to capture a greater share of the digital market,” the company’s full-year results disclosure stated, noting that the group had “put in place a number of building blocks” to support its digital restructuring.

Building blocks

Some of these building blocks took the shape of a substantial investment into its digital business, with Rank confirming plans to double its current level of investment and plough some £6.7m into its online division – with the majority used to fund Mecca Bingo – in an effort to increase its capabilities.

“Significant” upgrades have since been made to the Mecca Bingo mobile app, causing a 41% year-on-year increase in mobile revenues for the brand over the course of its last financial year. The app is certainly the most sophisticated in Rank’s current mobile portfolio and has been tailored specifically towards the mobile bingo audience, standing out from the majority of mobile bingo applications that remain HTML5 wraps.

The native app includes a number of onboarding features to help users less familiar with the technology or gaming on a mobile device get accustomed, demonstrating how to sign up, deposit and play their first game. Customers can register for account using a two-page registration process or use their Mecca account pin number if they’ve visited one of the firm’s bingo halls. Games are listed in their start-time order on the front page allowing customers to enter a game within one or two clicks, and a chat function for users to communicate with each other is displayed in the top right-hand side of the screen.

Rank’s development efforts have not gone unnoticed and the operator has reaped the rewards of a mobile focus on bingo. The firm derives more than 60% of new customer registrations through the mobile product and more than half of its customer base are now playing on mobile. The Mecca Bingo app won the best mobile bingo product category at last year’s eGaming Review Operator Awards and it has been favourably received by its customers, boasting an average rating of four stars out of five from a total of 1,600 ratings.

But if the Mecca app has received significant upgrades, its Grosvenor Casino counterpart has arguably been left neglected. Launched in May last year, the app has yet to receive a single upgrade and consists of a HTML5 wrap of its mobile site. The site’s slots, table and card games products – as well as its successful live casino product – are however mobile optimised and come from more than 15 separate suppliers. Content within the app is refreshed on Rank’s side to ensure the app remains up to date.

Grosvenor’s digital business is small but growing, however if it is to continue its growth then its mobile product will have to be brought up to date. A content deal with Swedish casino supplier Quickspin signed in April this year will see the delivery of a number of mobile-optimised slots products, however more will need to be done to its surrounding architecture if it’s to realise its mobile potential.

Brand power

But what Rank might lack in its current product portfolio, it makes up for in brand partnerships. With its exclusive partnership with the ITV talent show the X Factor, the Rank Group has a highly sought-after weapon at its disposal. It serves as the show’s exclusive gaming partner and reaps the benefits of being associated with a television show with such a broad reach. It’s perfectly aligned with Mecca Bingo’s target audience of middle-aged females and has the popularity to penetrate into other demographics.

The firm has used this to its advantage. Not only does the X Factor appear in its gaming titles, but Rank has spun off its X Factor Jackpot slot into its own, standalone app to complement its existing portfolio. Not only does Rank benefit from having a more diversified product suite that allows users to launch straight into one of the firm’s more popular products, but its presence in the App Store acts as a substantial marketing tool.

The app is listed among search results for the X Factor, which is a huge boost for its organic app discovery. And changes to the way App Store listings are populated with iOS8 has only enhanced this, with trending searches and suggested search terms added to the search bar.

Through launching the standalone app, Rank has boosted its chances of finding a more casual user and shifted the challenge at hand from one of app discovery to effective cross-sell. Delivering apps that the firm can cross-sell its acquired customers into is now the task at hand, however moves are afoot to accelerate this process.

Ready for the revolution

While last month’s interim results disclosure offered no material update as to the status of Rank’s digital overhaul, it is understood an announcement is imminent regarding a change of platform. Any change in platform is likely to form only a minor part of a digital overhaul designed to reposition Rank as a key player in the hugely competitive UK-facing egaming space. It retains some huge advantages in its land-based casino and bingo brands, but both face pressures in the digital space from the impeding PoC tax that is set to hit Rank hard in 2015.

And the competition is fierce, with recently upgraded apps from its biggest competitors and no shortage of marketing spend at the current time. Henry Birch, Colin Cole-Johnson and the as-yet-unidentified managing director for Mecca Bingo will certainly have their work cut out to boost growth in the vertical, but the signs are promising.

However it’s the firm’s casino business which needs the most work. Users have grown accustomed to the highly engaging native app experiences on offer from the likes of Unibet’s Spin City and Paddy Power’s Roller Casino. Making the most of its exclusive brand partners and land-based links will be vital, but not more so than ensuring its product is able to compete.

Rank’s overhaul is still a work in progress and, with mobile a crucial battleground in both bingo and casino, the operator will have to dedicate a sizeable portion of the £6.7m reserved for digital upgrades to the platform if it’s to truly compete. The next six months is likely to see substantial change for the group’s online offering, but arguably it will be its efforts on mobile that will dictate its success or failure in 2015.