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Friday, July 25, 2008

Churn

I received an interesting email awhile ago I thought I would share. It is from a small harness player.

I registered for a XXXX account and I must say I am impressed. All they need now is free video and programs. I like the smaller tracks like Monticello and Northville... I even tried a place ticket on a 3-1 greyhound...... best yet.... I started with 100........ betting frivilously and stupid, I blew it all... but next day I had 23 dollars in my account.... and then last night.... I got the 23 all the way back up to 100 and then blew it all again ... but anyway I managed to bet about $700.... So now they throw $35 back in my account....... Thanks for playing!!......... Back to the slow grind.

If this player took his $100 to the track, he is broke after the first day. Instead, by getting a boost through an overnight rebate he bet well over 7 times that amount. Instead of contributing $21 to racing through takeouts, he contributed over $150. There is a genuine excitement in his email, and I found that infectious. That is exactly what we need in this business.

This is a small player; and that folks is churn. Lower takeouts should not be just for whales. Whales started as minnows once too.

This was contributed by a Canadian member of HANA. As always, if you would like to join HANA please click here, it is free and all information is confidential. We'd love to have you a part of our association. We need your help to make this a better game.

2 comments:

Anonymous said...

I hope everyone realizes this, when HANA talks about rebates as a form of lowering takeout, this kind of rebating to low level players is part and parcel of that.

I think it does work, and if the industry just got out of the way and allowed some experimentation and different ADW business models to enter the market without such an uphill fight, you'd see this take off.

Rebates don't have to be reserved solely for million dollar a year bettors.

Anonymous said...

The casino industry's player rewards programs send direct mail marketing material to players; especially slot players, which includ comps for "free play", which contemplate that of they can just get you to show up there you will often times inject an additional direct spend that is two to three times the complimentary play offered.

These complimentary plays are not directed only to their "whales", and actually the size of the reward comp plays are predicated on past play and tiered accordingly. The comps are offered to almost everyone however just to incentivize them to come back and play again.

The tracks on the other hand go out of their way to alienate people by making them feel as though they are getting ripped off every time they go out there. Expensive parking, lofty admissions costs, outrageous concessions costs for pretty crappy food.

Time for a new business model; that's for sure.