Anthony F. Lucas

Measuring The Effect Of Casino-Operated Restaurant Volume On Slot Machine Business Volume: An Exploratory Study

Using data from three different North American casino markets, models designed to explain the variance in slot machine business volume (coin-in) produced a significant and positive effect for a variable representing casino-operated restaurant business volume (covers). Simultaneous multiple regression analysis was used to test the audited, secondary data for significance at the .05 alpha level. A 200-day period was examined for each casino property. The results of this study contradicted an earlier, counterintuitive finding by Lucas and Brewer that provided the basis for this work. The related literature is scarce, largely anecdotal, and split regarding the nature of the relationship between restaurants’ and casinos’ volumes. This exploratory study adds valuable empirical results to this limited but growing literature base while highlighting important strategic and managerial implications.

Managing the Slot Operations of a Hotel Casino in the Las Vegas Locals’ Market:

This exploratory study was designed to identify and explain the sources of variation in the daily slot handle of a locals’ market hotel casino in Las Vegas, Nevada. A regression model was used to analyze the effects of temporal, operational, and marketing variables hypothesized to influence slot handle. A simultaneous regression analysis was conducted with audited, secondary data using variables adapted from prior research. Significance tests were conducted at the .05 alpha level. The model failed to produce a significant effect for the food covers variable. The buy-in incentives (direct mail) and bingo headcount variables were significantly and positively related to slot handle. The temporal variables emerged as powerful predictors of slot handle. Finally, the results demonstrate the questionable economic significance of the buy-in incentives program and the bingo operation.

Estimating the Impact of Match-Play Promotional Offers on the Blackjack Business Volume of a Las Vegas Hotel Casino

Abstract A theoretical model advanced by Lucas and Kilby (2002) is modified and empirically tested to estimate the effect of match-play coupons on blackjack business volume. Although widely employed, little is known about the effectiveness of these play incentives. Using data from a Las Vegas Strip hotel casino spanning a 222-day period, a variable representing the dollar-value of match-play coupons redeemed fails to produce a positive effect on blackjack cash drop. Hypothesis testing is conducted via simultaneous multiple regression analysis at the .05 alpha level. Variables representing the day of the week, holidays and special events produce positive effects on blackjack cash drop.

Assessing the Profitability of Premium Players

Abstract High rollers may not mean high profits, particularly when casinos offer financial incentives to attract premium players.

Estimating the short-term effect of free-play offers in a Las Vegas hotel casino.

Abstract A direct mail offer, common to the casino industry, is analyzed using performance data obtained from the player database of a Las Vegas Strip hotel casino. These free-play offers, fueled by technological advances in player tracking systems, attempt to encourage repeat patronage by offering cash awards and free room nights. Despite compulsory play requirements, these popular offers fail to generate a statistically significant increase in individual trip slot volume. This result held across two levels of the offer, i.e., both

Estimating Untracked Gaming Volumes by Hotel Occupancy Segment

50 and

Estimating the Effects of Micro-Location Variables and Game Characteristics on Slot Machine Volume: A Performance-Potential Model

100 cash offers. Once offer costs are considered, the free-play campaign is found to produce negative cash flows. Related long-term issues, such as the inducement of increased visitation and polygamous loyalty, are also addressed. These unique results enrich both the casino marketing and direct marketing literature bases. Most importantly, this paper represents the only empirical study of a popular play incentive, increasing its practical value to casino operators.

Influences on Video Poker Machine Performance

Many Las Vegas gaming properties also operate hotels with thousands of rooms, which cannot be filled with premium gamblers every night. Given the fierce competition for premium gamblers, hotel-casino executives must pursue other segments as well. To choose segments that optimize earnings, management must compute the total value of a room night for each target segment. Customer spending traverses several departments, including slots, table games, restaurants, and retail. Unfortunately, many of these transactions are not captured at the customer level. Therefore, equations must be derived to estimate critical values, such as the change in unrated slot play resulting from a one-unit increase in the wholesale room segment. Such equations allow executives to fill in crucial gaps in the segment valuation grid. Once the overall profit per room night is computed for each hotel segment, operators can rank segment values. This business intelligence identifies the most and least valuable segments, allowing management to move toward optimizing earnings. Performance data from a Las Vegas Strip hotel-casino are used to illustrate the tenability of models designed to predict critical pieces of this profit puzzle. Unique and important differences in the margins of hotel-casino profit centers are also highlighted.

Decreases in a Slot Machine's Coefficient of Variation Lead to Increases in Customer Play Time

A performance-potential model explains 64% of the variation in the unit-level wagering volume of 166 slot machines located in a Las Vegas Strip casino. This study extends the extant gaming literature by narrowing the definition of a slot machine’s location and advancing new variables theorized to influence slot machine performance. Micro-location variables describing ceiling height, aisle locations, and the placement of a unit within a bank of machines all produce significant increases in unit-level performance. These results also have floor design implications related to increasing real capacity. In addition, slot signs fail to significantly affect coin-in levels, whereas the standard deviation of the pay-table and the top-award value produce significant and negative effects on performance. Casino executives are offered a performance-potential equation as an alternative evaluation tool beyond that of simplistic comparisons to categorical averages. The model specification is influenced by literature from the marketing, environmental psychology, performance-potential, and gaming disciplines.

From Maverick to Mafia to MBA: Gaming Industry Leadership in Las Vegas from 1931 through 2007

Abstract This study seeks to determine if slot machine performance levels are influenced by casino floor location and specific game characteristics. A Las Vegas hotel casino supplied the results of 418,