Inside Asian Gaming

INSIDE ASIAN GAMING | August 2011 46 O ne of the advantages of being a casual blackjack player as well as an avid student of gaming is the opportunitytoseevariouscasinos’marketing strategies in action. A couple of months ago, I happened to be at the receiving end of extremely poor player reinvestment in operation at my local casino on the Gold Coast in Australia. As most IAG readers know, player reinvestment is a strategy to reward loyal customers through targeted offers. The intent is to show appreciation to regular customers with the hope of retaining them and enhancing their lifetime value. With only one in five adults visiting a casino in any given year in the US, and only a fraction of them returning, player reinvestment plays a crucial role in preserving the relatively few customers who happen to be regular gamblers. Back to my experience with the casino in question. The management succeeded in creating just the opposite impact on yours truly in a matter of 24 hours. Let me explain. I played blackjack for 10 hours, betting around A$75 a hand on two boxes.The net result was a loss of A$4,450 over the ten hour period. The next day, I requested a comp voucher for a meal from the Casino Rewards Desk. To my utter surprise, I was told that my play translated into comps worth $36. To justify his point, the desk attendant informed me that someone else had dropped $15,000 in slots just a day ago and got $35 in comps. I know better than to expect 25% or even 20% of my losses in comps. Using the house advantage of 0.55% for Blackjack, the theoretical win for the casino in this case would be around $500. Andrew Klebanow, a casino consultant and friend, has conducted surveys of several casino markets in the US to estimate the level of player reinvestment. His conclusion was that in 2009, player reinvestment rates were between 25-43% of Why Ethical Player Reinvestment? By Sudhir Kale