Cost of Losing a Player

By Bill Zender

(This article is an exurb from my new book, Advantage Play For the Casino Executive (2006), and was printed in Casino Enterprise Management Magazine’s March 2006 edition)
 

This next and final part of this text begins with an exam question I developed to help test a floor supervisor’s ability to properly protect their blackjack games.  This question was one of twenty one question that covered areas of card counting and advantage play.  (Note: The article containing these questions can be found on my website: www.lastresortconsulting.com/pages/articles/ezine_21knowledge.html).  Here’s the question:

If you see that a player who is standing by a 21 table and, after a while, suddenly makes a big bet, the first thing you as a pit boss should do is:

A.) Take some time and analyze the play
B.) "Break" the deck
C.) Cut the shoe (or deck) in half from now on
D.) Tell the player that you don't want his play

When I ask supervisors and casino executives this question during classes and seminars I get every answer except the correct answer.  Many supervisors and casino executives are quick to make snap judgments in order to protect the bankroll forgetting they may be insulting a good customer who may represents plenty of future revenue potential.  The most common answer given for this question; “Tell the player that you don’t want his play” or can’t play until the cards are shuffled at the end of play.  Amazing!

This question deals with a customer who is standing by the table and jumps in with a big bet.  It’s always assumed he must have been counting the deck down and has just noticed a high positive count.  Why else would the player plunge in with a big bet?.  But if he is counting and finds an extremely plus situation, he’s all but guaranteed to win the hand, right?  Wrong.

If he is counting cards in this situation, the highest “true count” he can expect to achieve on a six deck shoe game is around a +8 using a single parameter count system (notice I stated it as true not running count). This occurs about once every 200 hands in the six deck game, and translates into a player edge of 3.5% (Snyder, 1987).  Wait! 3.5% edge?  That’s not a guarantee.  That’s less than the casino’s house advantage on even money bets on the roulette table.  If a player places a wager on black, is the casino guaranteed to win it? No.  So what does this number tell us?  Don’t sweat the small potential loss situation.  What’s it going to cost the casino if were wrong; practically nothing, or $3.50 per hundred dollars wagered.  What’s the best answer to the question; “Take some time and analyze the play”.

Today more and more supervisors and casino executives are gravitating toward the philosophy of “analyzing the play” instead of immediately labeling suspect players as “persona non gratis”.  Even though, what about the players who are given the boot unjustly; what does that cost the casino in lost revenue?  Back in the early 80’s I worked with a casino owner who prescribed to the theory that anyone moving their money in an up and down manner had to be counting cards.  He wanted anyone who the pit even suspected of card counting ejected from the property.  “Don’t worry about throwing someone out; there will be two more new customers walk in through the front doors when you do”.  I believe this argument held little validity then and I definitely know it doesn’t in this day and age.  In today’s highly competitive gaming market every player counts.  If a player is ejected or harassed to a point where he or she will never come back to your establishment, the loss will cost your operation revenue today and possibly for a number of years into the future as well.

Based on the previous example, let’s say management has put pressure on the live game manager to maintain no less than a specific hold percentage, and let’s say this live game manager has put even more pressure on his management staff to produce.  This type of negative motivation always breeds paranoia and the floor supervisors will probably be looking for anyone who might represent a threat to the casino’s bankroll, especially an unknown player who jumps into the middle of a six deck game with a handful of one hundred dollar chips.

Now let’s look at this from the player’s standpoint.  This player doesn’t like to just walk into a casino, and sit and play, but likes to walk around until he finds a friendly dealer.  This player loves to gamble and has plenty of disposable income in which to play with, and has a good personal income flow because he has a bright future with the company which he is employed.  The only problem is he likes to wander around a new casino just testing the water and looking for a fun table with a dealer who will make his stay on the table an enjoyable experience regardless whether he wins or loses. After buying in for chips and testing his luck once or twice he spies a blackjack shoe game that seems to have a group of players and a dealer having a great time.  So he approaches the table, says “hi” to everyone and proceeds to make a $200 bet.  Just then he notice a floor supervisor give him a suspicious once over and whisper something to the dealer.  Suddenly the atmosphere at the table turns cold, especially the dealer’s attitude, and he decides that maybe this isn’t the best table after all for his tastes.  He soon notices that every table he goes to turns “unfriendly”.  Since this casino seems to be cold and unfriendly, the player cashes out his chips at the cage and heads elsewhere.  The casino pit manager lets out a sigh of relief because a suspected advantage player just got the message that he won’t be able to ply his trade at “his” casino, and decided to take his action elsewhere.

Whether a casino runs a potentially good player off verbally or through their actions really isn’t important.  The fact that they have miss-diagnosed the situation and the player will never again enter their establishment.  So what’s the cost of losing this potential player?  First, we must establish some parameters of play regarding what the players’ worth based on his average bet and time played per session.

Table # - Player’s Worth per Trip

Based on this information we can assume that this player will be worth $936.00 every trip he makes to the casino.  If he makes six trips to the casino per year we can calculate his annual worth to be approximately $5,600.  This means that our casino had just mistakenly ran off one player who might be worth about $5,600 over the next year, not to mention an undeterminable number of years to come.  This doesn’t seem like that big a deal, right?  But, what happens if your casino chases away one player like this a month? Or, what about one player a week?  It’s easy to see that a problem of this kind can escalate quickly into thousands, if not hundreds of thousands of potential revenue chased down the street to the competition.  Be sure that your desire to raise the hold percentage or avoid advantage players does not translate into unacceptable revenue potential chased out the door.

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