Automated Retail

Giving Arcade Gaming A Level-Up

It’s pretty much “game over” for those old-school, fixed-price arcade video games. Updating self-service brick-and-mortar gaming means offering consoles featuring multiple games each, with prices and selections tailored to the venue and night, says Jake Galler, chief operating officer and co-founder of arcade cabinet startup Polycade. In this month’s Automated Retail Tracker, Galler discusses how data, the cloud and digital payments are modernizing arcade games.

Video games have come a long way from the early days of “Pong” and “Pac-Man,” when players crowded around joystick-equipped cabinets and inserted quarters to play 2D pixelated games. Today’s video games have high-definition graphics, carefully composed soundtracks and innovative gameplay, but classic arcade games retain their appeal, with ’80s nostalgia prompting the creation of bar arcades, or barcades. Entrepreneurs are exploring new ways to energize this space to draw in new customers along with long-time fans. 

Polycade is seeking to do just that by designing machines that enable easy payments and intuitive gaming experiences. Jake Galler, the company’s chief operating officer and co-founder, explained that Polycade’s sleek, wall-mounted gaming cabinets work well in bars and breweries, enabling users to play both traditional arcade and modern computer games. 

Galler spoke with PYMNTS about the company’s upcoming pay-to-play cabinet trial, which will focus on easy operation and data insights and will not require staff support. Up to a dozen of these machines will be deployed in downtown Los Angeles during the pilot, after which they will be rolled out to other cities.

From Quarters to Contactless 

Consumers likely will not be interested in complicated instructions on how to use or play games when they are out with friends, and bars may not have staff available to help. Polycade sought to provide an intuitive experience by offering easy-to-understand indie games as well as classic retro titles that many already know how to play.

The company also wanted to streamline payments acceptance, and did so by abandoning cash-only setups for digital ones with chip card readers and contactless payment capabilities. Such payment methods are key to offering quick transactions and consumer convenience, Galler noted – something cash is not known for.

“It didn’t make a ton of sense for us to incorporate an older hardware and technical solution into our machines when everyone’s looking to pay as easily and reliably as possible,” he said.

A new pricing approach also had to be determined along with the change in payment types. Traditional arcade cabinets feature single games and set numbers of lives that are purchased with quarters, determining how long users can play. Polycade’s cabinets stream multiple games to each machine, and the company charges players based on how long they wish to play, with current plans calling for $3 to $5 for 10 to 20 minutes of access. 

“It gives people the opportunity to put money in and try a couple different games,” Galler explained. “You can [pay to] unlock a machine … play a game you’ve never heard of for a few minutes and [say you] realize you didn’t like it. You don’t feel like you just got ripped off for having to put a few bucks into a machine to play a game you didn’t like [because] you still have time on the machine to go play a classic Atari game or something that you’re more familiar with.”

Payment Insights

Digital payments are also key to Polycade’s operating model. The system is cloud-connected, enabling the company to route digital payments directly into its bank account. This also makes it easier for Polycade to quickly manage its revenue sharing with game developers, bars and other owner-operators hosting the machines. The cloud connection also allows the company to monitor machines’ performances, track which games are getting the most and least play at particular locations, and analyze that information to adjust game options and set prices accordingly. 

“We’ll be using data learning and machine learning to track everything from what’s being played and what isn’t to the updates of a game, triggering discounts or tournament and leagues – things of that nature,” Galler said. 

Remote operation means Polycade can change prices, enabling them to offer happy hour or tournament discounts, raise prices during peak traffic on Friday and Saturday nights or lower prices on slow weekday evenings. Galler noted that the company intends to test different prices at different locations. 

Arcade games’ appeal can withstand decades, but payment methods frequently fall out of favor. Cloud-connected, intuitive payment systems may now be key to getting new generations in the door and hooked on retro games. 

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New PYMNTS Report: The CFO’s Guide To Digitizing B2B Payments – August 2020 

The CFO’s Guide To Digitizing B2B Payments, a PYMNTS and Comdata collaboration, examines how companies are updating their AP approaches to protect their cash flows, support their vendors and enable their financial departments to operate remotely.

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