Atlantic City casinos have been told that, through more careful selection of the promotions they offer, they could help to increase the overall local gambling market – and not just steal customers from their rivals.
Seul Ki Lee, an assistant professor at the School of Tourism and Hospitality Management at Temple University, looked at 11 casinos’ complimentary offers, or ‘comps’, to determine which achieved the best return on investment.
Perhaps surprisingly, those that tied customers to a specific casino – such as free rooms, bonus casino credit and food vouchers – made a return of just $2.51, most of which was cannibalised from elsewhere in the local casino market.
In stark contrast, those that allowed players to visit other casinos without forgoing their comps – for example, free parking or travel vouchers – brought as much as $8.45 in for every dollar spent by the relevant casino.
When neighbouring casinos’ earnings from these non-binding offers were included, the figure rose further, to $11.19.
The researcher explains that serious, regular weekend gamblers visit Atlantic City regardless of any special offers – meaning it is the casual tourist market that represents a better potential for increasing demand at casinos throughout the area.
However, with many casinos understandably reluctant to run promotions that benefit their rivals, it could be some time before a collaborative approach to growing the local market is seen.