WMS: Revenue Model Innovation for Gaming Solutions

Case Solution

Mohanbir Sawhney, Pallavi Goodman, Ori Broit
Kellogg School of Management ()

In 2014, WMS Gaming, a manufacturer and marketer of casino slot machines, considered redesigning its existing revenue model. As technology advanced and customer demand for gaming solutions intensified, innovative new revenue models were introduced in other technology markets. In particular, the subscription revenue model, in which customers paid a monthly subscription fee rather than a high initial fee, became widespread in the software industry. Product Manager Dayna Stone was tasked with evaluating various revenue models and recommending the one that best suited WMS business needs while taking into account the needs and wants of customers. Several factors that had to be taken into account made this decision difficult. Americans’ love of gambling had led to the expansion of casinos, which meant increased competition for casino dollars. But the 2008 financial crisis and its aftermath had weakened demand for casinos. Also, depending on the type of customers they attracted, the casinos differed in their appetites for innovation and maintenance of their slot machines. Students take on the role of Dayna Stone, who weighs these factors and selects the appropriate income model.

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