Supplier News
US – Acres Manufacturing reveals free slot play costs casinos $37bn a year
By Phil - 14 September 2023
Acres Manufacturing Company, a leading casino loyalty and technology developer, today released a new position paper as part of its ongoing series exploring the expensive realities of current casino loyalty technology.
This new position paper details the $37bn annual impact player loyalty reinvestment has on casinos’ profitability as a result of existing, antiquated legacy Casino Management System (CMS) technologies. With 166 patents issued and hundreds more pending, Acres created its Foundation hardware and Foundation HQ CMS specifically to address this opportunity. The new position paper, informed by a survey of nearly 200 US casinos, is available HERE alongside earlier installments analyzing the state of current CMS offerings.
The casino survey found that many loyalty programs provide player reinvestment rates approaching or even exceeding 100 per cent when exploited optimally, only maintaining profitability through breakage caused by unredeemed rewards or players that do not take full advantage of the program
Casinos’ net reinvestment in player loyalty conservatively hovers above 35 per cent or roughly $25bn with free play being the largest single cost contributor
Free play take up a significant portion of available play time, eviscerating profitability on novice or time-limited players. Including the time value of free play, net reinvestment balloons to over 50 per cent, or more than $37bn. If free play was eliminated without an impact to loyalty, profitability of slot machine operations would more than double.
“The casino industry’s continued reliance on free play to incentivize player loyalty is impacting industry slot profitability by more than $37bn every year, with smaller casinos typically bearing a larger relative percentage of this impact,” said Noah Acres. “The industry’s strategy of using free play to buy loyalty is completely misaligned with player preferences, as the potential to win is what truly drives loyalty, not free play. By leveraging our Foundation HQ CMS to replace free play with a gamified loyalty experience delivered in real-time as players spend their own money, casinos can exponentially grow revenues and profitability by modernizing their loyalty programs to eliminate massively scale and entertain new players rather than giving away expensive and underappreciated free play entitlements. As our series of position papers highlights, Foundation HQ’s modern technology can empower casino operators of all sizes to significantly increase revenue and lower costs by helping to scale enrollment and rethink player reinvestment strategies, thereby making player loyalty significantly more profitable.”
