Pulse

Roundtable: variable RTP

By William - 26 September 2022

Despite variable RTP in slots existing in the land-based sector for many years, the feature is now slowly becoming more popular in the online space.

Realistic Games, Kalamba Games, Evoplay and FunFair Games examine the benefits and challenges associated with implementing variable RTP.

To what extent does offering a variable RTP in games benefit both supplier and operator? How does this differ across markets with tighter regulatory restrictions?

Robert Lee, Commercial Director at Realistic Games: For us as a supplier, the main benefit is simply that it allows us to keep working closely with existing partners and deliver what they need. It also broadens the scope for new business.

For the operator, it’s about the extra profit margins. There’s not much research into it as far as I’m aware but what some operators have told us is that they’ve carried out significant AB testing when they’re operating games with different RTP levels. On the lower-level games, they’re seeing no difference in player burnout and no drop-in session times.

If you lower an RTP by 1.5 per cent, most players aren’t playing enough games to notice the difference during an average session. Of course, there are smarter players who will go to the help files and check, but they tend to be few and far between. Most have a favourite site that they play on and don’t often stray far from it, so they won’t care what the RTP is and play their games regardless.

Andrew Crosby, Chief Commercial Officer at Kalamba Games: In today’s climate, we see the need for varying RTP percentages for regulated markets. In Germany, the RTP level can be very low compared to the standard 96.6 per cent we have previously been used to, as operators need to offset the high turnover tax in the country.

UK operators have also been lowering RTP, not just because of the tax, but also looking ahead at regulatory changes that seem inevitable by the UKGC in the future. Being able to be flexible depending on the specific market needs is crucial, and we have seen an increased demand from operators demanding variable RTP.

Carlo Cooke, Commercial Director at FunFair Games: Variable RTP is currently a hot topic of discussion in the iGaming space and one which divides opinions. Since the introduction of variable RTP levels, we have seen a shift towards a lower default RTP, benefitting both the supplier and the operator by providing bigger margins.

Variable RTP also allows us to build games with a lower percentage and then increase the number if needed, which is easier than decreasing RTP as an afterthought. Designing lower meaning creating a better experience for players at the lower RTP, rather than simply reducing RTP to meet market demands, whilst maintaining integrity of the game.

When we say integrity, we are referring to the left side of the win curve and wins that create additional bets for players. To that end, given that the RTP is lower, it is easier for mathematicians to add wins, for example in the 50-70x range. This yields a stronger player experience, and ultimately benefits both the operator and supplier.

A variable RTP strategy gives operators flexibility and allows them to meet the needs of respective regulatory bodies, without impacting player experience and bottom-line revenues. Tighter regulations would normally impact operations, but thanks to lower default RTPs we can act quickly.

Operators are constantly under pressure to adhere to the ever-changing regulatory landscape and as a supplier, our job is to work and liaise with them to understand their needs and requirements for respective markets. We work with them to assist in supplying our games with the relevant RTP.

Ivan Kravchuk, Chief Executive Officer at Evoplay: If we speak about volumes, RTP has an influence on the revenues of both suppliers and operators, though the market sets its own rules and limits for the framework that they can operate within.

The difference between the RTPs that vendors offer – with some casinos providing a lower pay-out percentage – can significantly impact a player’s attitude, though it doesn’t influence a specific gaming experience.

As we know, regulatory bodies oversee the setting of limits for minimum RTP percentages, which varies considerably across different jurisdictions. Game suppliers that can be flexible enough to offer a vast range of RTPs within their products, with operators given the opportunity to choose which ones cater to their audience can really make a difference.

It guarantees fair play for gamblers, boosting their confidence in the figures provided on an operator’s website. Of course, this can vary greatly, with Germany being a prime example.

Is the variable option present across all your games? When did you decide to implement the feature and what prompted you to do so?

Ivan: From a game provider’s perspective, variable RTP serves as a strong vehicle with which they can shape their products to speak to players. By using it effectively, casinos can, to a certain extent, ‘customise’ their offerings and choose what works best for their audience.

The notion of considering a game with variable pay-out percentages as a standalone product is supported by the fact that every single RTP stands in line with regulatory requirements. Therefore, what we have is in effect, multiple options that provide flexibility to operators to make that choice.

Carlo: With the regulatory landscape constantly changing, we’ve altered our titles and now provide variable options to operators across our entire portfolio. Moving forward, all our games will feature a range of RTP variants from 88 per cent to 96 per cent, and we will add more options if operators request it.

We recently retrofitted RTP variants into our back catalogue and as per operator requests, we will continue improving our product offering. Bespoke titles will form a part of our product offering in the future and RTP is an area we will work closely with operators on to understand the sweet spot for different markets.

To put it simply, the market has changed and as a supplier you must act quickly and accordingly. Many things have changed post-covid, and RTP is no exception. As brick-and-mortar casinos closed, players consumed more online casino products and looked for a similar player experience that they saw in land-based venues, where the RTP is generally lower.

To be a leading supplier you must make your games more widely appealing to operators in respective markets and that’s exactly what we’ve done. Additionally, we’ve also seen a positive revenue increase by offering bigger margins and lower RTP titles, so it’s certainly the right move from a purely business point of view. I expect this trend will continue and that the RTP offering will increase to include an even wider range.

Robert: No. It’s only available in our newer games. We took the decision earlier this year with Gorilla Riches to introduce a variable RTP and for all new games going forward from that point. It’s much easier to develop three maths models for a new game than it is for existing ones.

To implement that across your back catalogue would involve a huge amount of work and it also risks upsetting players who are used to how older games have always performed. The other factor is that many operators don’t want the pain of reducing RTPs for a glut of games already on their site.

Initially, operator demand led to the adoption, and as more and more followed, we saw a domino effect of others getting involved because they saw rivals doing it. Not all operators followed suit but there are others have a firmer stance where they will only take a game with a certain RTP and nothing above it, so if we want to supply to them and continue the relationship, we had a decision to make.

Andrew: Yes, all our content available through our BullsEye platform has variable RTP levels ranging and including many variations from 88 per cent to 96.6 per cent. We’ve had the feature available for a couple of years now and when implementing it, we made sure we can change the RTP percentage per country, per game or any other way the operator wishes, giving unparalleled flexibility with choice.

We listen to the market and what is needed and in doing so we were ready for what the market required and more.

Some players have been vocal about their dislike of the possibility of inconsistency between online casinos and their favourite games. How widespread is this sentiment and how much of a challenge does this represent?

Carlo: As a player myself I know that this can be frustrating since you want to be sure that the RTP percentage of a game is presented clearly and easy to locate. This becomes a bigger issue when you consider that lesser-experienced players may not be informed or made aware of RTPs by the operator.

We’ve had internal discussions to explore what more we can do to better inform and educate players about game RTP, and this is perhaps something we can improve on as an industry, with both operators and suppliers paying close attention.

At FunFair Games, our development approach is more consistent and less impactful to the player experience as we design titles with a low default RTP and only increase it when necessary. While the math will change, the altercation to the RTP means that the overall gameplay and bonus features are not severely impacted.

Andrew: In my opinion, a player who plays a game with a one per cent swing in RTP would most likely not even feel the effect of this unless they were playing the same game for very long periods of time. A game to play at its theoretical RTP takes millions of game rounds.

I think in the past, this was a hot topic but now players have got used to the RTP changes and in reality probably do not feel any hit while playing. At the end of the day, a player always has a choice of where to play, and where they can find the highest and lowest RTPs from 99 per cent to 93 per cent.

Ivan: RTP’s role is most tangible when seen in a session with a large volume of spins, and ultimately doesn’t have a massive influence on the shorter sessions of more casual players, as the number of spins may vary, eventually influencing pay-out sizes.

For example, a player can win big with just one spin, with RTP skyrocketing, or experience a series of unsuccessful spins, considerably lowering it. After all, gambling in its very essence is RNG-based entertainment, where the element of chance and potential to ‘strike gold’ prevails.

The possibility of both a non-winning session with lots of spins, and a session with just one spin landing a big win, is ever present. Of course, that’s part of the fun!

Currently, more and more game developers are giving their attention to gamification, which is a massive win for games with lower RTPs. Not only can positive experiences be nurtured with random results, but also by the accomplishments that a player has achieved in a game thanks to its gamified features.

The element of fun can’t be overlooked, as this is what influences players to return to a specific title, even if they don’t experience sizeable wins with regularity.

Robert: It’s not a huge issue as far as I’m aware. It’s no different to, say, a supermarket chain – if they offer a reduced-price item then customers will visit them instead of a rival.

But as already mentioned, there are some who out of brand loyalty and familiarity will play at their preferred casino regardless. There will always be different price points among operators in iGaming and it is up to players to research accordingly before choosing where to deposit.

I believe a bigger problem exists where an operator changes RTPs and doesn’t tell players – an issue I’ve often seen raised within player forums.

Licence conditions state that operators must notify players when RTP changes takes effect, but some simply don’t or hide the changes deep in the game files or terms and conditions, so they are almost impossible to find.