Can Slot Players Tell If a Machine is “Loose” or “Tight?”

ON PLAYERS PERCEIVING "TIGHT" MACHINES

By Dennis Conrad, Dennis Conrad, President and Chief Strategist , Raving Consulting Company

I am not a market researcher, although I think I have a basic understanding of how to ask good questions of the right people and use the information to gain some reasonably valuable insights. But as far as understanding “research jargon” (you know, such terms as “causal relationship,” “confidence level,” “sampling error,”) or even keeping straight the difference between “mean” and “median,” well that’s just not me. I leave that to the Mike Meczka’s and Deb Hilgeman’s of the gaming research world.

Over the past few years, there have been a couple of academic research projects pretending  to shed light on a particularly thorny issue – whether slot players can tell the difference between two otherwise identical slot machines, but where one machine was significantly “looser” than the other. The studies were conducted in two different ways, one was a “simulation” (not real gambling) and the other was a live “casino floor trial,” where two sets of two slot machines were set up side by side for six months to see if players would notice the looser game and begin to gravitate towards it and spend more money on it, since, I guess, it was “better” for them and they could “perceive” it.

I’ll leave it to the professional casino researchers to comment on the validity of these studies, the quality of their “findings,” and the overall research methodology that was used in the study (although I do believe that they were both flawed studies). But I do take great exception to the “implied results” of these “player perception studies,” namely that SLOT PLAYERS COULD NOT TELL THE DIFFERENCE BETWEEEN TWO SLOT MACHINE EXPERIENCES WHERE ONE MACHINE WAS 25% MORE GENEROUS THAN THE OTHER. And the implied corollary was YOU CAN TIGHTEN YOUR SLOTS, MAKE MORE MONEY, AND YOUR PLAYERS WON’T KNOW IT!!!

As someone who has been preaching the concept of “restoring value to the casino playing experience,” I find this to be the most dangerous and false “advice” I have ever seen enter the gaming media and the casino industry public discourse. Again, I am not a researcher, so I am not going to try and pick apart the research methodology, even if I find a study involving TWO machines laughable. I won’t poke holes in the studies’ obvious assumptions that players are rational and would compare two SLOT EXPERIENCES like they were comparing a name brand and a generic brand on a grocery store shelf (think Kirkland vs. Nabisco), with their obvious and posted difference in prices.

No, as a consultant, discussion leader, industry observer, and (maybe most importantly) a CASINO PLAYER MYSELF, I thought I’d suggest a couple of different ways to do a real and valid study on whether casino slot players can tell the difference between a tight machine and a loose machine. In Dennis’ Research Method 1, I’d have a willing casino subject property (I realize no casino is likely to do this) divide its slot floor into equal halves, with identical slot products in each, except that in one half the slots are 25% looser than the other half. Then I would chart the results for the year (just the total win of the two halves not TWIN, Actual Win, Handle or anything else) to see WHICH HALF OF THE SLOT FLOOR MADE THE MOST MONEY.

Ok, tough experiment to pull off. Well in Dennis Research Method 2, I’d simply look at the posted yearly slot results in gaming states that post such numbers, along with each individual casino’s overall slot hold percentage for the year. Then I would divide the state set of casinos into competitive market sets and look at the correlation between slot hold percentages and win per unit numbers of these competitors.

So there you have my two simple experiments to see if you should tighten your slots to make more money and (somehow) not tick off your slot players. In “Dennis 1,” I’m betting that after a year, the loose slot floor half would have much more slot win than the tight half. And in “Dennis 2,” I’m betting the loose casino in the market would greatly outperform the tighter competitors in slot win metrics.

But here’s the real surprise. I actually AGREE with the (otherwise misguided) slot researches who say a player can’t really tell a tight slot from a loose slot after an extended period of time. The vagaries of win cycles, individualized player results and a WHOLE BUNCH OF OTHER FACTORS, would disguise the actual rate we nibble away at each individual slot player’s “time on device.” But take your top 20,000 slot players who almost always play at multiple properties in a competitive gaming market, and ask them who has the loosest slot machines in your market. If it’s not you (and I believe most of them will tell you it’s not), and you don’t believe that affects how they share their slot wallet with other (looser) casinos, you’re crazy.

Please don’t tighten your slot machines, at least any more than you already have.

Short term gain. Long term pain.

Believe it.

This article was originally published in the July 2017 Issue of Casino Journal.

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About the author

Dennis Conrad
President and Chief Strategist of Raving, Dennis has over 40 years of casino experience, including keno writer, bartender, dealer, floorperson, gaming instructor, special events manager, casino marketing director, gaming institute director, and corporate vice president of employee training and development. Meet Dennis at G2E this year at Raving's Insider Party.
 

One thought on “Can Slot Players Tell If a Machine is “Loose” or “Tight?”

  1. Dennis is a very long time friend and former co-worker when we were both at Harrah’s Las Vegas (then Holiday Casino/Holiday Inn).

    I agree with him about casino marketing on many things but on the issue of loose vs tight machines I have told him (and Mike Meczka who shares a similar view to Dennis) I do not.

    While I won’t get into in all among the reasons I think that players cannot tell, and that it is not a smart financial move to lower hold:

    1. Penny machines have been extremely popular for years now and have typically seen the greatest revenue growth of any denomination. Yet they easily have the highest average hold of any slot denomination.

    2. In markets where the overall casino slot hold is reported, the most successful (highest revenue) companies were not necessarily those with the lowest hold and when I last looked at it years ago Marketing Research surveys did not show the lowest hold casinos to be seen as the “luckiest”,

    3. Most slot play is tracked thru Players Clubs with substantial promotional rewards including point multiples offered. So the net cost of the hold percentage is affected by the amount of rewards given back rather than just being a straight function of hold.

    4. Most slot players, especially casual players like tourists, don’t approach gambling as a mathematical exercise, don’t understand the concept of hold and don’t really know how much they totally wagered during a visit versus knowing what their budget is and how long they played.

    5. Loose or tight, about 2/3rds of players lose money on a visit. But if they had fun and excitement and good service they generally feel that had a good time and value for their money.

    — David Zamarin

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