The claw machine market capitalises on consumers’ enthusiasm for testing their luck and attracts a dedicated clientele with a wide range of prizes. These machines are increasingly prevalent due to their low operating costs and minimal entry barrier. Despite their popularity, the Consumer Council oftentimes receives complaints about these machines, covering a myriad of reported issues. These include the pincers automatically loosening coupled with an undisclosed “guaranteed grab” mechanism that acted as a minimum spend requirement; successfully grabbing a winning paper slip but not receiving the displayed prize leading to disappointment; and a shortage of coins in the coin exchange machine with refunds issued in the form of play rounds, thereby compelling further consumption.
To increase revenue, the industry often modifies claw settings or introduces obstacles inside claw machines to make winning more challenging. However, the Council opines that these adjustments should be reasonable, and terms of play should be clearly stated in order to provide a positive consumer experience, as excessive difficulty or unfair settings could aggravate consumers. Furthermore, the industry should display fair and clear rules for winning prizes, for example any terms and conditions for mechanisms such as the “guaranteed grab” or points redemption being visible on the machine to enhance transparency. The Council reminds the industry that linking coin exchange to play rounds is an unfair practice and no different from forcing consumption. This practice ought to be stopped and rectified to maintain public trust in the industry’s integrity.
Case 1: Taiwanese Model Claw Machine Loosened Grip Automatically
“Guaranteed Grab” Mechanism No Different from Compulsory Minimum Spend
The complainant was drawn by a toy reward in one of Trader A’s claw machines and played 4 rounds at $5 per game. Yet, whenever she had managed to lift the toy, the pincers would automatically loosen once the claw reached the top, causing the toy to fall back down. The staff told the complainant that this was the machine’s setting and not a case of malfunction. Additionally, the machine featured a “guaranteed grab” mechanism – should a player spend up to a certain amount without winning, the claw would maintain its grip until it reached the prize chute. However, the complainant felt that this slack setting of the claw made it impossible to win without reaching the “guaranteed grab” threshold. Besides, no information about the “guaranteed grab” mechanism was presented in-store, and she only learned about it after enquiring with the staff. Considering this to be a dishonest trade practice that compromised consumers’ rights, she reported the case to the Council.
Trader A responded by explaining that their machines were Taiwanese-style 3-pincer models, designed in a way that the claw would loosen its grip when it returned to the prize chute. In order to win, players were required to skilfully and gradually move the rewards towards the chute. Trader A also added that all their machines included a “guaranteed grab” mechanism to ensure players could eventually win. On the claw machine the complainant engaged with, the “guaranteed grab” threshold was set at $100. The issue was resolved promptly when the staff refunded $20 to the complainant as soon as they received her complaint.
Case 2: Grabbed “Instant Prize” Paper Slip but Not Given Displayed Prize from Claw Machine
Trader B featured a claw machine filled with paper slips. Some slips were marked with points that could be collected to redeem rewards, while others labelled “instant prize” granted players immediate rewards. The complainant was particularly interested in one of the displayed instant prizes, a waffle maker, inside the claw machine. After a 45-minute attempt and spending nearly $500, he finally succeeded in grabbing an instant prize paper slip numbered 33. When collecting his prize, the staff handed him a gift box marked with “instant prize 33” from an unknown corner but inside were nothing more than a few trinkets. Refusing this prize, the complainant contacted the machine operator via instant messaging, who then offered him another displayed item inside the claw machine, a chocolate fountain machine, as a substitute. Despite extended discussions, no agreement was reached.
From the complainant’s perspective, the instant prizes inside the claw machine were not numbered, and the terms and conditions regarding prize collection were nowhere to be seen around the machine. As such, he believed that consumers should have the right to select their reward. Furthermore, although he had managed to grab around 150 slips, he collected only 7 points in total, while most prizes required over 10 points to redeem. Feeling that the game settings made it extremely difficult to collect enough points for basic rewards, and that it was misleading to display but not provide the reward (the waffle maker), he lodged a complaint with the Council. After multiple unsuccessful written attempts to Trader B to try to reach the claw machine operator, the case could not be conciliated. The Council recommended the complainant to consider consulting legal advice before deciding whether to seek further redress.
Case 3: Coin Exchange Machine Out of Coins
Not Cash Refunds but Play Rounds Forcing Consumption
The complainant was playing at Trader C’s arcade and attempted to break a $100 bill into $5 coins with the coin exchange machine. However, after inserting the bill, he received only one $5 coin and no receipt. When he contacted the merchant for a cash refund, his request was declined. Instead, he was offered the equivalent value in play rounds on the arcade’s claw machines as compensation. Believing that the coin shortage in the exchange machine was an issue of mismanagement on the trader’s end, he felt entitled to a cash refund rather than being compelled to accept play rounds on game machines he was not interested in. Perceiving this as a potential case of forced consumption, he filed a complaint with the Council.
In its response to the Council, Trader C explained that coin exchange incurred operating costs such as bank fees. Refunds in the form of play rounds were therefore intended to prevent exploitation of the coin exchange machine. It also added that the relevant terms and conditions had been clearly displayed on the machine, and thus upheld the decision not to issue a cash refund. The Council advised the complainant to consider pursuing further redress through civil avenues.
Some consumers might believe that arcades operating claw machines, which are luck-based entertainment devices, should be protected by the Places of Public Entertainment Ordinance. However, a court ruling in 2022 determined that claw machines do not meet the definition of entertainment under this ordinance, thus arcades with claw machines are neither subject to the licensing requirements nor regulated by this ordinance. In recent years, “lucky machines” using the claw hand of claw machines to play dice-rolling games have emerged in the market. These games rely purely on luck and use valuable prizes such as game consoles, mobile phones, and even cash to attract consumers. As the police have been cracking down on individuals suspected of using these machines for gambling activities, consumers should exercise caution. They should be aware that engaging with these machines could potentially violate the Gambling Ordinance and result in legal consequences.
Claw games exist in many different formats. Besides the gameplay itself, the prizes showcased inside the machines can also entice consumers to try their luck or even lead to excessive spending. Therefore, when playing, consumers should keep the following in mind:
- The difficulty of claw games is influenced by factors such as the machine settings and arrangement of items inside the machines. The skill and luck of the player could also affect the outcome. Consumers are advised to spend rationally and be mindful of addiction. Although some machines come with a “guaranteed grab” or “guaranteed win” design to reward players after a specific number of plays, consumers should assess whether the total amount spent is worth the value of the desired prize;
- Many claw machine arcades do not have staff on-site, and the machines may be owned by different operators. As a result, consumers may not be able to immediately contact the person in charge if they have questions about the game rules or encounter issues while playing. In such cases, they should look out for information posted inside the arcade or on the machines;
- Since claw machines are coin-operated, consumers typically do not receive receipts. If necessary, they may consider recording their gameplay as video evidence to support any claims in case of disputes.
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