Keeping Customers Happy in Casinos

Nov. 1, 2007 — -- Walking into a casino is a visceral experience. Hundreds of people line the slot machines and gaming tables. Scantily clad cocktail waitresses parade around carrying trays of free drinks. The bells and whistles of the slot machines dominate the room with losing spins buried beneath the sounds of the vociferous payout routines of the lucky few.

The facade of success is a key weapon of the casinos in making sure that when people start gambling, they do not soon stop.

"Casinos try and ply their patrons with the idea of good luck," said Frank Scoblete, a well-known gaming writer. "Above the urinals at Tropicana Casino in Atlantic City they would have photos of previous winners holding giant checks so there would be no escaping the pretense that everyone's a winner."

Which of course they are not. Casinos thrive because the house generally wins. In games like poker, generally it does not matter how good the table of players is as the casino always takes a cut of the pot. Think of it as a rent for using the table.

A key weapon of the casinos is the comp card system, casino-specific credit cards that tot up an individual's gambling totals and reward in the style of frequent flyer miles — the more money a person gambles, the more freebies the casino gives them.

"It's one of the most brilliant ways to keep you at a particular casino," regular craps player Joey Farrales told ABC News. "When I go to certain casinos they have me on file and I'm treated to complimentary meals, tickets to shows and sometimes a free room."

These perks help ensure people stay in the vicinity of casinos where the temptation to gamble remains. The more people spend, the more comps they get. Players are divided on casino databases from low-level players, who spend say $5 each time they bet, to midlevel players who average say $250, up to high rollers who spend thousands on each bet.

"Each group looks up to the group above them as something special as, the higher you are ranked, the more freebies you get," Scoblete said."The thing is that it's all an illusion as the greater power you have, the more money you're often losing. The players know this, but it's almost like a drug the casinos are feeding them."

The excitement and adrenaline created by the prospects of winning big blends with the time warp illusion of casinos that never sleep. Scoblete told the story of a lady at the Golden Nugget casino who asked what day it was. "When I told her it was April 2, she asked me where April 1 had gone."

Alcohol also plays its part. Gaming regulations prohibit casinos from supplying clearly intoxicated people with alcohol, but most people are still able to have a steady supply of fresh cocktails brought to them throughout the night.

"The waitresses certainly ply us guys with drink," said Farrales. "As I'm playing though, I ask myself if I feel in the right frame of mind. If I'm too drunk then I'll decide on just one or two more rounds [of cards] and then walk away."

Gaming authorities told ABC News, they take the drinking issue seriously, and insist that instances of people complaining that they were so intoxicated that they felt taken advantage of by the casino are rare.

But it is not at the cards tables that casinos make the majority of their money — it's at the slots. Experts say that the percentage of profits from slot machines varies from casino to casino but ranges between 10 percent and 30 percent, depending on the state.

"The bonus rounds featured on today's slot machines are the greatest incentive for people to play they've ever had," said slot machine expert John Robison. "People say to themselves, 'I'll just have one more spin on the "Wheel of fortune,"' with the temptation to get to the bonus round just one more time almost irresistible."

Hitting the winning combination on a bonus round can mean a jackpot worth millions of dollars. When big money is on the line, casinos and their patrons can often butt heads.

Gary Hoffman, a retired Albuquerque city employee, is suing the Sandia Resort and Casino in New Mexico saying it refused to pay a $1.6 million jackpot he says he won playing the slots. The casino says the jackpot was a computer mistake.

Gaming commissions often intervene in such circumstances and make the decision as to who gets to keep the cash, in the hopes of avoiding court battles.

But figuring out how to work out the increasingly complex machines is the first challenge.

"When I'm on an investigation and go out and look at the machines I can initially get confused too," said Jerry Markling, chief of the Nevada Gaming Commission's Enforcement Division. "However, regulations require that instructions are included on the games so it makes sense to read them before playing."

In 2006, 923 cases involving more than $38 million in disputed winnings were investigated by Nevada's Gaming Commission. Of these cases, only 10 percent went the way of the patron, with a total of $1.7 million paid out by the casinos.

"Our investigations usually find that the patron simply misunderstood the payout rules, but sometimes it's people hoping to get rich by taking a shot," Markling said.

Experts say the grand trick of successful casinos is not to try and take everyone's money in one fell swoop. It is to get players to participate in games where the casino has a very small statistical edge in winning.

"Nobody wants to lose everything within the first three minutes," said professor I. Nelson Rose, of Whitier Law School in Costa Mesa Calif., who developed one of the first casino-law classes. "People are buying time and the longer they sit at a slot machine they happier they are — even if they ultimately go away with a loss."

The flashing lights, alcohol and lack of windows or clocks place many people into a land of fantasy. Casinos want their patrons to win small victories and feel good — so long as, in the end, they come out on top.

"The money they [let] you win or what they give you for free is overwhelmingly dwarfed by what they know you'll lose," said Scoblete.

Each and every day, casinos rake in the cash with none of the hoopla that accompanies a patron hitting the jackpot. After all, if you advertise yourself as unbeatable then soon enough people will stop wanting to play with you.