Could reinventing family fun serve as a lifeline in Chuck E. Cheese’s current bankruptcy case?

chuck e cheese, cec entertainment, winner winner app, business, covid-19, bankruptcy, businesses in bankruptcy, coronavirus

PUBLISHED ON MEDIUM

Home. Where a kid can be a kid.

Growing up, a kid was a kid when climbing through plastic tubes, jumping into a lagoon of colorful balls, happily watching animatronics malfunction, eating pizza, and — of course — exchanging our hard-earned tickets for spider rings and bubble gum wristwatches. Over the years, our favorite birthday venue would transform before our very eyes, serving a newer generation and doing away with our bless-ed jungle gyms — all while adding touch screens into the mix.

And, then… COVID struck.

Amidst national shutdowns and closures, Chuck E. Cheese would go on to see its greatest transformation, yet. Concerned that virus would linger on the surfaces of old tickets and gaming devices, the company decided to go contactless and instead target families at home, while relinquishing the torch to good old Pasqually through the launch of a secondary pizza and wings business. Although many locations would remain open, capacity would be limited throughout the pandemic. Overhead remained. And now, the entire franchise is facing bankruptcy.

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Image by Steven Miller via Flickr

Protecting customers at the pinnacle of the pandemic

Initially, most Chuck E. Cheese locations remained open but shortened their business hours to abide by local laws and regulations. With operations taking a direct hit, they began to offer discounted summer passes in effort to an avert the inevitable. These passes would cost customers more in the short-run but would include unlimited game time and benefits. Vetting regulars would mean that locations could remain open, while fewer crowds were in attendance. And while each store was open to the public, fewer customers were coming for fear of catching the virus.

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via @SomaQz on Twitter

Fewer customers meant fewer winnings.

To protect the company from liabilities that could surmise through the unlawful distribution of more than seven billion prize tickets, the company would come up with a plan to not only put those tickets to good use but to also keep their most beloved loyalists from jumping ship.

Since the beginning of the pandemic, the existing supply chain began stockpiling outstanding ticket orders, leaving various vendors in possession of the CEC-based currency and creating a huge risk for the organization. These tickets would normally be awarded, directly, to store patrons and would have otherwise been redeemed for small prizes, candy, and branded merchandise. If not properly monitored, these excess tickets could disrupt an already fragile environment and lead to the immediate closure of the remaining Chuck E. Cheese locations, across the country.

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Image via The Pinning Mama

A move to protect their assets and keep brand currency from unfairly diluting

In a June court filing, Chuck E. Cheese asked for a judge’s permission to destroy tickets that had not yet been distributed, over fears that over $9M in prize merchandise could be unfairly claimed if these tickets would somehow end up in open markets. This would protect actual ticket holders that might one day be able to redeem existing balances.

The claim went on to state that the quantity of physical tickets, not yet in circulation, would fill more than 65 forty-foot cargo shipping containers and would need to be destroyed immediately. In order to retrieve these pent-up tickets and carry out the demolition, they would then receive the judge’s approval to use $2.3M and take immediate action in doing so.

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Image via CEC Entertainment, Inc.

Chuck E. Cheese continues to stay innovative.

On the evening of September 23, Chuck E. Cheese announced a new initiative that would allow parents to convert tickets, that they may have been saving, into a new digital format by allowing them to mail outstanding award tickets for credits on the Winner WinnerLive Arcade app.

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Image provided by CEC Entertainment, Inc.

Prior to the COVID-19 pandemic, Chuck E. Cheese had already implemented the use of digital CEC currencies, replacing traditional arcade tokens with reloadable game cards. This allowed the company to cut back on residual expenses, associated with the minting, distribution, and sanitization of branded game tokens. It also minimized the repair and downtime of game and token machines, damaged from the misuse and jamming of coins in token slots. This move to a more digital format also cut down wait times for customers reloading coin cups, strengthened customer loss prevention efforts, and drove customers to spend more time and money at each location.

Needless to say, the move to a digital ticketing system had been in the works for a while. In fact, over time, it would lead to the company to further eliminate the unnecessary repair and damage of machines due to ticket jams, provide more accountability for ticket distribution during the malfunction of said games and minimize congestion at the ticket counter. Particularly relevant at this time, it is also a giant step towards improving sanitary conditions at each location. As of late, these efforts have been accelerated due to both the COVID-19 pandemic and the industry’s rapid move toward contactless service. The ultimate goal would be to remain contactless post-pandemic in creating a more fun, healthy, and highly efficient experience for regular patrons and annual birthday goers.

A move to save the company while rewarding brand enthusiasts

Taking the fun of Chuck E. Cheese to the Winner Winner App, patrons may not have to say goodbye to their favorite “Pizza Time Theatre” location, after all. In exchange for individual prize tickets, customers will receive 1–1 redemption within the virtual Winner Winner Prize Center, free additional game tokens, and the opportunity to participate in the “Play Free Until You Win” promotion.

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Image via CEC Entertainment, Inc.

While the pandemic may have shuttered many businesses, most customers still want the experience and thrill of playing real live arcade games and winning tangible prizes that they can show their friends. As the mobile gaming industry continues to thrive, Winner Winner is set to be a true success, bringing home 24/7 live streaming action and mobile gaming experiences to Chuck E. Cheese fans all over the world.

The perks of family home entertainment

Customers won’t feel the threat of catching the virus while eating a slice of pizza from the comfort of their own home — and, they won’t be restricted to business hours when doing so. They can play real live claw machine games, try their chance at the color-changing UFO, interact with the Chuck E. Cheese prize grabber and engage with many of the other ticket-style arcade games we have all grown to love.

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Image via CEC Entertainment, Inc.

CEC promises to recreate the unparallel offline experience through distance gaming.

Promising to offer high-quality prizes and a one of a kind game experience, Chuck E. Cheese emphasizes that these are “100% real machines, 100% real prizes and 100% real home entertainment…” Prizes will be delivered upon redemption. Winner Winner is available un the iOS App Store and Google Play.

Will Chuck E. Cheese be a casualty of the pandemic?

Will Chuck E. Cheese be able to save their business? Possibly. But, this will depend on the millions of patrons that visit nearby locations on a weekly basis. Chuck E. Cheese will depend on the support of their audiences, as they get through these trying times. The opening of Pasqually’s Pizza and the continued delivery of Chuck E. Cheese brand pizzas via crowdsourcing delivery apps, such as GrubHub and DoorDash, and will also add to the potential of keeping each and every store open across the country.

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Image provided by CEC Entertainment, Inc.

As part of Chuck E. Cheese’s commitment to an enhanced guest experience, Chuck E. Cheese recently rolled out e-tickets to help ensure a cleaner, greener, faster way to earn and redeem prizes. And while over time, physical tickets will be replaced with e-tickets at all locations, guests can rest assured that any physical tickets they now have or win in our restaurants are still valid for prizes.

A hero of our generation, Chuck E. Cheese has lived through several recessions, aggressive competition, and the fierce opposition of regulations, leading to the removal of play centers and ball pits, over the years. The company continues to do what it has to do to survive. There are rumors of live action movies and cartoons, and pizza boxes can now be transformed into an at-home game of skee-ball. We just can’t let it die!

Through innovative design concepts and the at-home delivery of family fun and entertainment, not only could they get through the tail-end of this pandemic with ease, but they just might bring our families closer together.

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