Advising a proper live game and slot mix

 



THE PROBLEM

Let's spend a few minutes defining the problem for table games departments:

  • Loss of revenue share and floor space to slots.
  • Declining departmental profitability.
  • Lack of technical advancements.
  • Stagnant product line--still predominantly original Black Jack, Roulette and Punto Banco, the same as it has been for decades. However, this is beginning to change.


    • What other challenges are being faced by table games departments?

    SLOT COMPARISON

    Let’s look at slots to see why this product line has improved so dramatically. When table games were the dominant product, slots were mechanical machines with certain key deficiencies:
  • No coin-in information.
  • No game result information.
  • Susceptible to cheating.
  • Labour intensive.
  • No player information.
  • Limited game variety due to 22 mechanical stops that only provide 10,648 different reel combinations.


    • What happened to change the way slot departments operated? Improved technology! By applying electronics to slots here's what happened:

  • Precise coin-in information provides a true measure of volume and popularity.
  • Precise game result information tells the casino exactly what happened on every handle pull.
  • Difficult to cheat. Game outcome is determined by an electronic random number generator.
  • Automation of hoppers and bill acceptors has reduced the need for change and jackpot payoff labour. Fewer moving parts have reduced the need for slot mechanics.
  • Player tracking has provided the casinos with exact information of individual player worth and has dramatically expanded the ability to use complimentaries, tournaments and promotions to develop profitable slot play.
  • The ability to have 255 stops per reel now gives casinos up to 16.6 million reel combinations to better configure payouts, manipulate house advantage, experiment with hit frequency and provide $20 million progressive jackpots.
  • Increased game speed has resulted from the spin button and the use of credit meters and "play max coin" buttons.
  • Slot bonusing and merchandising has freshened the product.
  • Linked and wide area progressives have added excitement and "life-changing" reasons to play.
  • Video poker has created an entire new segment of players.
  • Video slots are dramatically increasing the coin-in per pull.


    • Now, what's happened to table games? You still have no record of coin-in or what is truly bet on your tables. You have no record of the results of a hand. You are still labor intensive. Your inventory is uncounted cash/chips. You continue to be vulnerable to cheating. Player tracking relies on sporadic observation and manual data entry. Not enough new games and game enhancements to take back floor space.

    What innovations can you point to that address these issues and help table games to compete with slots?

  • Shufflers provide the table games version of a random number generator.
  • Coin-in acceptors on tables for Caribbean Stud. Not widely adopted elsewhere.
  • Progressive meters are used occasionally, but jackpots are lower than are available in slots and security is an issue.
  • Game variety is improving somewhat, particularly with poker-style table games, but Black Jack, Punto Banco and Roulette are still the most frequent offerings.
  • Player tracking has been automated somewhat
  • Management information systems still rely on manual data input.


    • Your customers use technology in their jobs, at home and for entertainment. Table games is behind the curve.

    GAME REVENUE PRODUCTIVITY STANDARDS

    Innovations are there now, however, table games departments need to develop strategies and analyses in order to determine what innovations to introduce and test, and what standards new innovations must achieve in order to decide whether to keep an innovation permanently.

    First, let's identify the fundamental elements of how you generate revenues at table games:

    1. House advantage--theoretical win percentage. This is the price you charge for your product.
    2. Average wager--what the player bets per hand.
    3. Game speed-- decisions per hour.
    4. Length of play--how long player stays in action.
    5. Number of players--average table utilization.
    6. Game integrity--how well is your game protected from manipulation, fraud or theft.

    Can you think of anything else not covered by these six items that is fundamental to the generation of revenues at table games? On the daily report for table games for your casino, what information on these basic elements is provided?

    A MacDonalds burger shop provides more information for its manager than any multimillion dollar casino table games department! MacDonalds knows how many people they served; the average price per customer; how much of each product they served; shortages in the cash registers; when every sale was made; etc., etc., etc. In a table games department, until you place a cash register or computer on the table, you will always be working from partial information. This places heavy emphasis on the theories of the table games business. If you do not have access to timely, accurate and thorough information about your performance, you have to be very sharp in understanding your business. Swiss Gaming Corporation offers you THE solution by its Magic Table Control and yes; you can have a Jackpot System on your tables with or without a connection with your slots!

    As a company, you should conduct the research necessary to set up revenue performance standards for your existing games on the floor.

    Decisions per hour X house advantage X average wager X number of players provides the hourly revenue productivity model for your table games.

    It is particularly important to do this on Black Jack, as this game is the most typical target for enhancements or to be replaced by a new game. Since there is no cash register on your table, this research must be gathered by statistical sampling methods through observations by surveillance and other floor observation methods. If you fail to establish productivity standards on the revenue performance of your tables, it will be very difficult to determine whether innovations being offered to you by vendors will be improvements or not.

    Let's construct an hourly productivity model for Black Jack.

    A typical model for a grind Black Jack table might look like this- 70 hands per hour per player X .015 house advantage X $20 average wager X average utilization of 3 players = $63 per hour revenue productivity rate.

    Another key measurement of a new game offering is to ascertain the game's fair share performance. For example, if the objective is to outperform the average blackjack table on your floor, set the blackjack revenue production by table as the standard or 100%. Then compare the new games performance as a percentage of the blackjack standard.

    For example, the Black Jack revenue per table per day in Casino A is $1,000. The performance of new game X is $1,200. New game X's fair share performance is 120%, clearly exceeding the criteria set for its success. New game Y is winning $850 and its fair share percentage is only 85% and is clearly under the criteria of outperforming the average blackjack table.

    However, you should target your poorest performing tables on the floor for replacement or enhancement. In that circumstance, the criteria for new game success could be lower than the average Black Jack.

    MARKETING AND OPERATING EXPENSE STANDARDS

    Revenue production is not the only component of table games profitability. The marketing of your product and operating expenses are important components as well. Many of the innovations you will be evaluating will provide benefits in these areas. The methodology that I advocate in looking at the marketing potential of an innovation is as follows:

    1. Attract players. Does the innovation have signage, meters or uniqueness that draws people to the game? Is the innovation strong enough to be used in advertising to attract players to the casino to seek out the game?
    2. Initiate play. Is the innovation inviting and non-intimidating so that once drawn to the game, a player will give it a try?
    3. Sustain play. Is the game enough fun, easy enough to learn yet challenging?
    4. Price. Is the innovation priced right to encourage the player to stay and play? What is the house advantage, hit frequency, average win, player loss per hour?
    5. Return play. Is the playing experience fun and exciting? Does the player get a fair chance at winning? Will the player want to return to play the game?

    Is there anything that we have missed?

    The areas of expense to evaluate an innovation include:

    1. Risk. Is the innovation vulnerable to cheating techniques by players or dealers?
    2. Labor. Does the innovation require additional or less supervision, surveillance or other labour?
    3. Regulatory. Will there be increased regulatory costs?
    4. Capital. What will be the initial capital outlay for the innovation? Electrical, cameras, signage, meter, etc. costs?
    5. Lease costs. What will be the ongoing lease, participation or rental expense?
    6. Comps. Will the innovation increase or decrease complimentary costs?
    7. Maintenance. What upkeep will be required?
    8. Service. Does the vendor have local service support?
    9. Training. Does the vendor provide dealer procedures, minimum control standards and training?
    10. Supplies. Will the innovation require expensive or an abnormal amount of supplies?

    Having read this, take a look at MTC, Magic Table Control and realise then what possibilities you have to make your Table Games, or your Table Games/ Slotmix more attractive and controllable. Management is information. SGC: Smart, General, Clever.