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Casino Credit:
Part Four
Click
here
for Part I, here
for Part II or here
for Part III of this series
The
subject of casino-credit is a popular one with frequent Vegas visitors and
professional craps players alike. Both types need to stay on top of changes in
the law or opportunities in casino operating procedures.
Today’s item has “Profit
Opportunity” written all over it.
Marker-Debt Discounts
A player wrote in and asked:
“I’ve heard that some
casinos will write-off a portion of a player’s marker-debt if he has established
a Line-of-Credit. Is that true, and how does it work?”
The answer is as resounding, “YES”!
Why the
Discount?
Ø
All casinos are willing to comp-back
a certain percentage of a players “action” in the form of comps. For most
players, some of the “comp-value” is usually left untapped. In a recent
nationwide gaming survey, Harrah’s noted that up to 80% of available comps go
unclaimed, unused, or un-asked for by players.
Ø
The higher or longer that you play,
the more they are willing to comp back to you. There is a generally accepted
schedule of comp-percentage allowances based on the “expected value” (EV) or
expected-win from each particular players level and type of bets.
Ø
Each casino-corporation has a
slightly different comp-formula criteria which is programmed into their
Player-Rating computer. Bet-size versus bet-spread versus bet-type versus
session-time are all weighed differently by each corporation, but you generally
end up with the same percentage of permitted comps.
Ø
Generally the formula looks like
this:
| Average Bet |
Comp Percentage |
| |
|
| $5 to $15 per hand |
10% |
|
$25-$50 |
15% |
| $50-$100 |
20% |
|
$100-$200
|
25% |
| $200+over |
30% |
Ø
Of course, you have to remember that
a $5 player at the Sahara Hotel-Casino is considered a “premium” full RFB+++
player, while a $25 player at Caesars Palace will only reluctantly get comped
for a cheese sandwich. Each casino has a different comp-threshold that it wants
you to reach before they open up the gates to their kingdom.
Ø
MGM-Mirage controls slightly more
than half (51%) of the city's high-end gambling market through its Bellagio, MGM
Grand, Mirage, Treasure Island, and Golden Nugget properties.
Ø
Park Place Entertainment with its
Caesars Palace, Bally’s, Paris, Flamingo and LV Hilton-operations control
another 25% of the high-end market, while Mandalay Bay Group (8%) and The
Venetian (4%) pick up much of the remaining “premium-player” business.
Ø
The remaining 12% is roughly split
between Harrah’s, Rio, The Palms, Hard Rock and a few other casinos throughout
LV and Clarke County.
Ø
The monopolization of the high-end
market by those three top corporations actually led to a decrease
in the costly practice of discounting high-roller losses.
Ø
However, just as you will find in a
free-market society, some of their comparatively smaller competitors were
willing to cut profit-margins in hope of locking up a slightly larger
market-share, or even getting a taste of the high-roller business for the first
time.
Ø
When the three major players (MGM,
PPE, MBG) decided to reduce the percentage of marker-discounts they were willing
to offer; the smaller casino operators decided to increase
their comp-back values in hopes of snagging some disgruntled up-market players.
Ø
This has made the whole
Line-of-Credit and Marker-Discount process more competitive. It has also
broadened the scope and number of players that now qualify for those discounted
markers.
Typically, a casino may ask that a $100,000 loser
pay back $92,000 or 92% of the marker-debt (an 8% discount), but The Venetian
started pushing that envelope more than two years ago, writing-off and reducing
the markers “call value” by as much as 15% to 25% of a gambler's losses.
That Venetian move forced the other
large-operators to follow suit or risk losing too many of it’s premium-players.
Concurrent with that, the smaller casino operators decided to increase
their comp-back and marker-debt discounts to snag some of those tasty and
profitable mid-level players.
Remember that a mid-level player
at Bellagio is considered a “whale” at the Tropicana, Aladdin,
Stardust, Riviera or Stratosphere to name just a few.
Also keep in mind that a mid-level
player at NYNY, The Riv or the Aladdin, is considered a
“super-whale” at places like Fremont Hotel, Plaza, Sunset Station,
Frontier, Four Queens, or Gold Coast for example.
All of those marker-debt discounting moves have
filtered down to lower-ranked players with smaller, but still attractive
Lines-of–Credit. In the post 9-11 reality, no casino wants to lose ANY good
player who gives the casino a shot at their confirmed bankroll.
To that end, mere mortals like the Mad Professor
and other professional craps players have been able to take advantage of that
new corporate largesse as it filters down to low and mid-level players.
How to Profit from
Marker-Debt Discounts
If you’ve read my articles
with more than just a passing interest, you know that I am a firm believer in
“skimming” significant amounts of gaming-chips from your rail-space during every
session. It makes your wins look much, much smaller and your losses
look much, much larger.
Let me tell you how “marker
play” can actually add more profit to your bankroll.
As you skim off healthy
amounts of gaming-chips during your session, you are not only hiding how much
money you have won, but you are making it appear as though most, if not all of
your craps sessions are losing ones.
According to the casino, as a
craps player, YOU ARE SUPPOSED LOSE. So why disappoint them…appear to be a
loser...a BIG loser!
While you are actually making
a Precision-Shooting profit during most of your sessions, they think that you
are just another gambler who consistently loses.
Those apparent “losses” bring
in bigger and better comps, plus they bring in more “direct cash” benefits.
Fully rebating your first-class airfare, pre-paying for your next return to
Vegas-ville, and reducing the amount of your marker-debt by ranges of 5% all
the way up to 25% are some of those “direct cash” benefits.
That is the amount that you
are “entitled to” by the casino through its comp-back formula. If you haven’t
consumed all of your comp benefits; then they are usually willing to reduce your
marker-debt by at least a corresponding amount, and usually even more.
Remember they want to retain
good (read: LOSING) players. They are willing to do whatever makes economic
sense to keep you coming back to their gaming-house again and again.
There are many benefits to
having a Line-of-Credit arranged at different hotels…discounted marker-debt
where you have actually made a profit is one of those benefits.
Have a look at a simplified
example to see how it all works. Let’s say that you have played as follows:
Ø
A three-night,
four-day stay.
Ø
You played four
sessions per day.
Ø
Each session
averaged about 90 minutes.
Ø
You played a
total of 16 sessions.
Ø
That means you
played a total of about 24 hours at the craps table.
Ø
At each session
you pulled down a $1000 marker.
Ø
You managed to
squirrel away or “skim” about $400 in chips from each session.
Ø
Let’s say that
your Precision-Shooting was not up to par, but it wasn’t altogether lousy. You
maintained discipline, and were very selective about how you bet on other
players.
Ø
Overall you made
a $1000 profit, but because of “skimming” $400 from each session, you “appear”
to have actually lost $6400.
Ø
You drew a total
of $16,000 in markers from your Line-of-Credit.
Ø
In the casinos
view, you “lost” 40% of your “exposed” bankroll, and your average bet was decent
enough to warrant your “normal” room/food/shows comp.
Ø
“Exposure” or
“buy-in” doesn’t usually figure into the comp-equation for low-buck players, but
it figures prominently for big-buck and credit-players because of bet-volatility
and the larger bankroll-swings that occur with premium-players. That volatility
usually heavily favors the casino.
Ø
In the final
comp-evaluation, they will look at the “EV”, the “expected value” that they
should have gotten from you and compare it to their “actual” win. Remember,
they think you lost $6400, even though you actually made a $1000 profit.
Ø
Let’s say that
they expected to “win” about $3500 from you based on your bet-types, bet-level,
and betting-time, and that covered your “normal” room/food/shows comps.
Ø
That leaves
about $2900 over the expected “EV” casino-win. Since your normal comps have
been covered, IF YOU ASK, they should be willing to “knock a little off” of your
marker-debt, especially if you are willing to pay it off in full before checking
out of their hotel.
Ø
With that in
mind, you could ask for and expect a marker-debt discount of anywhere from $300
up to $750. Let’s say you generally agree and accept a $500 discount off of
your outstanding marker.
Ø
When you
“settle” or pay your marker, you would actually be paying it off with money that
you managed to squirrel away at the tables.
Ø
Your profit
picture now looks like this:
$1000 from your actual
Precision-Shooting winnings
+ $500
cash-in-hand balance after marker-debt payment
= $1500 in
actual profit
Like I said, there are many benefits to having a Line-of-Credit arranged at
different hotels. Discounted marker-debt is just one more of those profit
opportunities.
Good Luck & Good Skill at the Tables…and in Life.
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