If you are new to Player Development, then here are some of the words that you will hear being used:
Actual. If you played for two hours on the $1 slots and you won $2500 then your actual win or loss is $2500. The slot machines truly cannot control who wins and loses, or by how much, so the Casino has no idea what your actual will be, when you ‘make a trip’ and play.
Theo. The computer system can figure out how much you would Theoretically lose when you come back, by watching how you played for those two hours on the $1 slots.
Your Theo might be 15 which means that theoretically you will lose $15 every time you play. Or your Theo might be 250 which means theoretically you will lose $250 every time you play.
The casino uses this Theo number to decide what to send you as free offers. If your Theo is $15 then you should not going to get an offer for a free hotel room! To qualify for a Host, you probably need a 400+ Theo but this varies across Casinos depending on the type of players that they have.
ADT stands for Average Daily Theo. The computer system will typically look at how you have played over the last 30, 60, or 90 days. Your ADT is the total Theo for all of your trips, divided by the number of days you played, to get your average.
Let’s say you played on 3 days; your first day had a Theo of 600, your second day had a Theo of 400, and your third day had a Theo of 500. 600+500+400 = 1500/3 = 500. Your average, your ADT, is 500.
ADT is very important to the Player Development team because it is an easy way to see how important the guest is; and if the ADT goes way up, or way down, over a few months, then the Host can see that there is something happening with that player, be it good or bad for the Casino.
Comp. Traditionally, a Casino Host has been able to give a player a Comp (short for Complimentary) for food, drinks, hotel, spa, and even for free play.
But, as more and more casinos have opened across the United States, there is so much competition that it is harder for each casino to make a lot of money; so they have often cut back on Comps.
If the casino does let the Casino Host issue comps, then there will be strict guidelines on what can and cannot be given. (These rules are sometimes called a Comp Matrix.)
Coded. A player that is coded to a Host in the Player Tracking System or a spreadsheet. There will typically be 300-400 players coded to each Host. (We are not advocating that many players, we are just making an observation on what we have seen.)
Active. The Active players are making regular enough Trips with a high-end ADT. For example, 450+ ADT and 12+ trips over the last six months.
These players have visited ‘recently’ which has a different definition by Property and Market. If your casino serves local players within a two-hour drive, then ‘recently’ might be a trip within the last 3 months, but you may also have some really high-end players that come in twice a year from a distant major city and deserve VIP attention.
In Database Marketing, we take a longer view so ‘Active’ tends to mean ‘played in the last 12 months’. In Player Development, we are focused on a small set of highly valuable players who should be visiting with above average frequency, so ‘Active’ may mean 3 months.
Inactive. A player that used to play with a high ADT and frequency of trips but has not visited ‘recently’. If the Player Development team can get these people back on property then that is called Reactivation.
At Risk. A player ‘at risk’ is an Active player that is almost Inactive! For example, if your criteria for Active is that they have played with six months, then an Active player might be considered ‘at risk’ if they have not played for four months. You can focus the Player Development team on these at risk players by setting a Retention Goal. For example, “80% of Active coded players must play at least once a Quarter.”
Churn. “Are you busy generating new customers but losing your existing customers at the same rate?” If a Host acquires 20 new players but allows 60 Active players to slip away because they are dissatisfied then the Host is down by 40 valuable players. Read More.
Incliner and Decliner. We refer to a player as an Incliner if contribution is increasing because of increased trips, increased ADT, or both. Conversely, a player is Declining if they have few trips, lower ADT, or both.
Acquisition. A player that is not coded to a Host but is playing often enough, and with enough Theo, to be coded to a Host in the future. Many PD programs will monitor these players and assign a Host to reach out and develop them.
New. A player that signed up within the last few days and has played with a high enough Theo to suggest they could be valuable in the future. These are sometimes referred to as Dibbed players meaning a Host has dibs on them, or as Ghosted to describe the fact that the Host is quietly monitoring the player.
Earned Benefit. In some Properties, it is considered a valuable benefit to be coded to a Host, and a player can ‘earn’ this VIP Service as part of their Tier benefits in the loyalty program. A player is automatically coded if their play is high enough, and will be automatically de-coded if their play falls away.
Valuable. Does a valuable player have a 200+ ADT or a 600+ ADT? The definition of valuable varies by Property and Market. A valuable player to a casino on the Strip is playing much higher than a valuable player in a casino in a rural area. But the 80:20 rule applies in both cases. Who are the 20% of players that are contributing 80% of revenue?
Profitable. If you want a lively discussion in your next team meeting then initiate this debate about who is most profitable?
- Kim who plays 20 days each month with a 100 ADT and receives a free buffet?
- Or, Beth who plays twice a month with a 1000 ADT but demands the penthouse and a dinner comp, and drinks all the Jack Daniels in the VIP room?
Their total Theo per month is the same and Kim’s expenses are less, so she is more profitable to the Casino. In most Properties, Beth will have a VIP Host because of his 500 ADT and Kin will not, with her 100 ADT. So many Properties use both ADT and total Theo as criteria for decisions in both Direct Mail and Player Development.
Retention. See Churn above.
Upside Down. A player that is ‘upside down’ is consuming more expenses than is warranted by their Theo. Let’s say the VP Marketing has set a maximum investment of 23% in players. A player is upside down if their total expenses for the month are $280 and their total Theo is $1000 i.e. investment is 28% of Theo.
Net Theo (Total Theo – Total Expenses) is sometimes used in the Host Goals to measure value. For example, the goal “Increase Net Theo from Active players by 10% over the same quarter last year” is measuring both an increase in Theo and a control on expenses.