Casino Marketing & Technology Conference: Let’s solve disconnect between marketing and slots that costs millions

July 20, 2023 1:39 PM
  • Buddy Frank, CDC Gaming Reports
July 20, 2023 1:39 PM

This controversial panel at the recent Casino Marketing & Technology Conference began with a statement that at many casinos the slot and marketing teams are siloed from each other. They seldom share data, ideas, and information as much as they should. And sometimes, neither group uses the data they have.

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Robbie Sawyer, COO Slotco, said, “I’ve worked on both sides of the slots and marketing fence for about 22 years. That disconnect is real … to say the least.”

In addition, it’s no exaggeration that millions of dollars are at stake. Casinos across the country generated more than $90 billion last year and with rare exceptions (like the Las Vegas Strip), slot-machine revenues are often 70%-80% of that total.

Often the slot team doesn’t look carefully enough at its own data and the connection to players to make major gains.

Panelist Nick Hogan, CEO of the survey and analytical firm ReelMetrics, said, “When we look at the balance of (slot) inventory relative to player demand, that’s where the most startling mismatches really pop. What we see is that between 55% and 65% of most mixes that we look at fail to meet our definition of a ‘dog.'” He added that “78% of new slot-machine titles failed to reach an index of 1.0 (or House Average) at any time in their lifespans.”

Andrew Cardno, who co-founded the analytical firm Quick Custom Intelligence (QCI), asked the audience the interesting question, “How do you make money in the casino?” While that seemed obvious at first, he noted that we often do the math wrong by just looking at individual slot machines and judging them by their win per unit per day (WPUPD). Somewhat sarcastically, he said, “I can tell you the easy way to increase that performance metric of each game is to remove half of them.” His point was that looking at the WPUPD “was the wrong kind of math.”

He noted, “Slot machines don’t make money. Players playing those machines are how we make money.” He explained that’s why casinos need to examine the entire market basket of the various machines that players want to play and design strategies around those products and customers.

Sawyer said, “Subtle ways to bridge the gap for marketers include artwork in your promotional material that features the games that your targeted players enjoy. And that data can be shared from slot operations.”

It’s also vital to have enough of the popular games that top players prefer. Hogan said the pandemic-related reduction in machines on the floor allowed his firm to do some double-blind testing of before and after the addition or subtraction machines. “Through very minor adjustments to overall (machine) inventories, creating incremental capacity on those (popular) games, we saw the trip value on these players just skyrocket. What we’re doing is satisfying players in that they get on what they want to play.”

Mike Trask represented the slot vendor side as product manager for Ainsworth Game Technology. He said, “The bulk of what we’re doing is trying to find that magic (that makes a machine successful). One of the most recent things we’re doing is bringing in YouTube players having private-play action.” But he confessed that “until you’re sitting there with your own $100 and you’re sticking it in that game and you’re hitting that spin button, you can never properly judge performance.” He said that is the casino’s true advantage when their marketing and slot teams share well (they have that firsthand data).

Cardno pointed out that incremental revenue, not necessarily WPUPD, was the key metric in evaluating a game. “Everyone here would say that a game performing at half house average is a dog. But if (that revenue) is all incremental, it’s still a great game. Try and argue against extra money in your bank account; you just can’t. We’ve measured it at QCI. This is the point of decision when we think many have been measuring it wrong. We’ve been optimizing performance of game when what we want is more incremental revenue.”

Moderator Buddy Frank of BF Slot Strategies said, “While standard video poker games are seldom top performers, if you don’t have them, video poker players will go elsewhere and your overall revenues will decline. When you do have them, their revenue is therefore incremental and a big plus, despite their low WPUPD numbers.”

Frank also polled the audience, composed almost entirely of marketing pros, by asking, “How many go to lunch at least once every two weeks with your slot manager or director?” Only a few hands went up. One marketer commented that their slot director said, “It’s my floor, not yours.”

A few marketers noted that they meet on a regular basis with their slot-department counterparts and the panelists all agreed that such collaboration is key to a more productive slot floor.

The three-day conference sponsored by Raving Consulting wrapped up on Thursday at the Grand Sierra Resort in Reno. It was the first time that conference met in northern Nevada after being held in Las Vegas for more than two decades.