Want to roll a dice? I’m sure you would love to roll. Let’s accept it, we all have been enticed at least once by the very thought of rolling the dice in a plush casino even though we are not sure whether we will go with our hands full. From the scintillating lights of Las Vegas strip to the local poker parlours of China and Bangkok, people across the world make travel plans to brush up on their skills at blackjack, roulette or poker and see if lady luck is smiling at them! Despite economic ebb and flow, the casino industry continues to attract the crowds. The growth of this industry seems to be mushrooming and with so many new players getting involved, the stakes are pretty high.
According to Technavio’s market research analysts, the casino gaming market in the US is growing at a rapid pace and gearing to grow at a CAGR of around 5% during 2016-2020. However, there are several bottlenecks that could cripple this growth. One of the biggest challenges is to give the players the game they want. Players have disposable income and hence they look towards having some variety and exciting offers/games on their table. Secondly, casinos attract massive crowds, which makes it an easy target of thieves and fraudsters. Needless to say, there is always a way out. This post will address why analytics is now a hot topic in the gambling space and how it is helping the casino industry solve challenges.
Turning Challenges into Opportunities
In business, as in baseball, the question isn’t whether or not you’ll jump into analytics. The question is when. Do you want to ride the analytics horse to profitability… or follow it with a shovel. – Rob Neyer
This quote has a lot of relevance for the casino / gaming industry. Casino owners, for decades, have resorted to giving incentives to gamblers in the forms of special deals and offers. Over the last decade or so, consumer preferences have seen a dramatic shift. A huge percentage of consumers are now spending their time and money on experiences outside of the gaming floor; food, entertainment, and retail, leading to a decline in gaming revenues. Casinos have therefore been forced to think out of the box and provide a more comprehensive casino resort experience to attract and retain customers. Customer experience has become the top business metrics for casinos and the hospitality industry in general. Customer Data is now driving the evolution of this lucrative industry.
Allowing Data to Speak!
The casino industry today, is a data-driven industry, with customer data being captured at every possible avenue. That level of granularity presents both a challenge as well as an opportunity. Customer data comes in structured and unstructured forms and in huge volumes. Making sense of all this data and deriving actionable insights is a massive exercise involving advanced analytics capabilities, tools, and processes. Analytics has multiple applications in casino operations. For example, casinos have started using analytics to determine an ideal layout for games to maximize revenue. Apart from gambling revenue optimization, casinos are also looking for ways to encourage gambling by offering customers lucrative deals on stay and food. The key is to be selective and tailor the offer according to customer preference. That’s where customer analytics comes into play. The applications are numerous and one thing is for certain…the gaming industry can no longer leave things to luck!
Increasing the Customer Relationship Value
With so many people gambling occasionally for fun and not necessarily for winning, major casino players like Las Vegas Sands (LVS), MGM Resorts (MGM), Caesar Entertainment (CZR), and Pinnacle Entertainment (PNK) have embraced analytics to attract customers who are most likely to respond to a new offer. Free betting vouchers and enhanced odds are provided to woo the new players, thereby bolstering customer acquisition. Additionally, recognizing which games are played by the player based on his/her past data can help the casino industry to offer suggestions and embellish game strategies, thus enticing customers into the game of fun or (profit). Unstructured customer data in the form of reviews, customer feedback and social media brand mentions (to name a few) is a vital source of insights for customer loyalty programs. Mining this data can help organizations extract significant value and enhance customer relationship. In parallel, casino managers can build a robust roadmap for managing the data deluge and get a real 360-degree view of what their customers are experiencing. The takeaway: what the casino industry gets from analytics is the ‘lifetime value’ of the customer whose behaviour can be analysed only with the power of analytics.
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Foreseeing Security Threats
Although a casino is a place for all kinds of people, from the great roller and fun seekers to married men, it is also a place for much less desirable guests. Some roam the casino room floor, cheating at cards or sneaking craps bets onto the table after the dice has already been thrown. Others use tech skills—or even something as low-tech as a garage door clicker—to trick slot machines into making more frequent payouts. A portion of people on the floor are fraudsters waiting for the perfect opportunity to win big and slink away. For casinos grappling to detect and prevent fraud, advanced behavioural analytics can come to the rescue by helping spot the difference between a flesh-and-blood player and fraudsters.
Although most casinos rely on security personnel handling high-megapixel digital cameras to identify unwanted guests and biometric technology, behavioural analytics can also prove to be the silver bullet in nabbing fraudsters. Just as each person has a distinct fingerprint that helps identify him or her, each person also has inimitable behaviours and habits that reveal their actual identity. Behaviour-based analytics compares the data sent by the security system that records user behaviour against the images of undesirables in the casino’s database, thus allowing to differentiate between a real player and an undesirable.
Behaviour-based analytics looks for signals such as how the guests hold their device, how they use a mouse or a trackpad when playing. It is these non-identifying but wholly unique behaviours that create a player profile that can’t be faked. Las Vegas casinos catch card-counting teams at Blackjack tables by using ‘Entity Analytics’ to churn out and connect information about their patrons/fraudsters/potential employees. With the broader utilization of analytics, casino operators can even catch the bad guys while they are still playing Blackjack.
Betting on the Growth of Analytics
The casino industry is expanding and casino operators have embarked on a series of high-profile expansions into various markets by obliterating their tight spots. Having incorporated modern and diverse amenities, casinos today attract a substantial number of overseas visitors, thus aiding to stimulate the economy of that particular place. This expansion presents endless and tantalizing opportunities for the analytics market to grow. It’s the right time for analytics players to spend every waking moment thinking about enhancing their analytics solutions, thereby helping casinos in improving service to patrons, increasing patron loyalty, optimizing gaming revenue, achieving a greater return on promotions, reducing costs, and bolstering operational efficiencies.
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