Most of the time it is belly-aching, but once-in-awhile a player is not actually receiving the proper accounting of his gaming action by a casino. The estimation of theoretical win (upon which a player’s comps are based) has always been a touchy point with table games players.
There has been an historic disconnect between the level at which a player believes he is providing action and the house’s perception of play. This chasm, which occasionally boils down to a player feeling at odds with a property, is a root of pit angst. For the most part, an experienced table games supervisor tracks play activity with a decent level of accuracy. With the increased integration of automated table-tracking systems, negotiations concerning table-player activity will become a relic like paper punch cards.
One would think the highly automated slot tracking systems currently employed and time-tested in casinos would be flawless; yet, the venerable slot tracking systems are only as perfect as their human handlers. At some casinos, the theoretical casino win/player loss calculated by a slot tracking system may be off due to calibration.
Just as if a bathroom scale was set ten pounds too low at the manufacturer, one would assume one’s weight was correct and not ten pounds higher that it actually it is. Only after stepping on a verified scale, such as at the doctor’s office, does one verify the inaccuracy of the home scale (and maybe kicking the blasted thing, sending one back to the doctor for a broken foot).
The process of accountability to ensure reliability, and validity, of casino tracked data should be completed with religious devotion, but sometimes it is not. Thus, this article will explore one casino’s miscalculations of its slot players’ theoretical, the reasons why it occurred, and how it was discovered.
As a member of a direct marketing analysis and fulfillment team working with a casino property (we’ll call it for anonymity’s sake “KW’s Gold Diggers”), one of our efforts to better serve the customer was to evaluate their current database’s status. A database audit was used to explore the hygiene and health (i.e., was the data correct, and where it was supposed to be?).
Multiple checks on various aspects of the data contained within the player tracking system were made (through queries), much like when a doctor does a complete physical. Instead of a stethoscope and thermometer, our group looked at the following matters to establish a rudimentary baseline:
While some of the data, such as the gender identifier, caused some concern (e.g., Why was a statistically significant amount of the database’s gender unknown or unspecified? Was this an input issue, or a tracking issue?), data hygiene challenges can be resolved with a thorough data scrub when categorical information, such as gender, can be determined and appended.
What was more worrisome was the apparent disparity between what the casino theoretically should have been winning from the clients (house win theoretical) and what they actually were winning from clients (house win/loss, or actual win/loss).
The measure of variance between what should be in terms of win (theoretical hold) and actual win/loss (house win/loss) provides a performance indicator of how close (or far) a certain group of players (e.g., >200 ADT) is gaming away from the norm.
Note: The aberration is the measure, not whether the casino is winning or losing more or less from a particular group.
There are two measurements used to determine variance: approximate win/approximate hold percentage and theoretical/actual win using absolute variance.
Approximate Win / Approximate Hold Percentage
The difference between approximate hold percentage, as represented by win/coin in, should range along with the game types and denominations played. The benchmark of 5.7 percent (an average hold for the Colorado limited stakes casino market and a proxy for KW’s Gold Diggers) is used to understand at what percent a player group (in this case as delineated by cash-back groupings) is playing the norm.
Theoretical / Actual Win Using Absolute Variance
The absolute variance measures the difference within player groups (this time ADT delineated) of the amount of theoretical win and actual win. Since all absolute values are measured in the positive, it is the direct measure of distance from a norm. Using the weight example again, if a person’s norm weight is 100 pounds, but he weighs 90, he is ten pounds from the norm; the same is true with 110 pounds.
These results suggest that the actual (approximate) hold for the cash-back groups is not in line with some cash-back groups (i.e., the win/hold for the 800 cash-back group is .28 percent, as compared with a benchmark 5.7 percent for overall slots in the Black Hawk market). The 800 cash-back group (probably affected by the rule of large/small numbers) is only showing 4.96 percent of the hold it should.
The larger groupings of those receiving less cash back (suggesting a reasonable sample size) are closer to an expected house hold (e.g., the $60 cash-back group has an overall average provision of a house win of 5.83 percent: a 2.2 percent difference from the norm). The highest hold is attributed to the no cash-backs group ($0) at 17.71 percent, or three times the expected hold.
Please note that the $0 cash-back group has an ADT of $9 and average-daily-coin-in of $100, plus an unredeemed point compilation of 1,472,150. This may be explained by this group playing higher-than-average hold machines, such as the multi-line penny.
At some casinos, the theoretical casino win/player loss calculated by a slot tracking system may be off due to calibration.
As one may deduce, these measurements of variance provide a neon, bright-red flag to further explore the reason for the discontinuity between actual and theoretical holding levels at KW’s Gold Diggers’ specific issues need to be understood, such as: pace of play, difficulty of universal calibration (as with a multi-game unit), and game-type/denomination utilization. Otherwise, the table game and slot machine (belly-aching) players will not be recognized and rewarded at the level at which they should expect. Further, they will actually be right unless adequate and reasonable measures to ensure players are tracked correctly are pursued.
David Paster is a faculty member at the University of Southern Mississippi College of Business and owns and operates Yarborough Planning LLC, an independent consulting firm. He has 10 years of hospitality and gaming experience. Paster can be reached at (702) 813-5062 or davidpaster1[at]yahoo.com.
Baseline Audit Key Performance Indicators for Gaming Analysis:
Number of Players in Customer Database
Inside Market Region
Complete Addresses
Outside In-State
Complete Phone Numbers
Out of State
Complete E-mails
Do Not Mail
Gender
Average Coin In Per Trip
Average Daily Theoretical
Interest Coded
Age Groups
Acquired: New sign-up and only 1 visit during active < > month evaluation period (dates:______)
Retained: New sign-up and =< visits during active month evaluation period (dates:______)
Active New: New sign-up and 3< visits during active month evaluation period (dates:______)
Active Established: Non-new member with =<3 visits during active month evaluation period (dates:______)
Frequent Established: Non-new member with 3< visits during active month evaluation period (dates:______)
Dormant Established: Non-new member who has not played within active month evaluation period (dates:______), but did play within prior month evaluation period (dates:______)
Archive Established: Non-new member who has not played within the prior two active evaluation periods (dates:______)
Comments
Post new comment