CASINO ENTERTAINMENT - A NATIVE TALENT BUYERS PERSPECTIVE
DOES YOUR TRIBAL CASINO NEED ENTERTAINMENT?
Live entertainment in the modern-day tribal casino is used for one very important purpose, retention. Before we dig into the important elements of retention or how it impacts tribal casinos, we should talk about the number one goal of any strategy or marketing effort, which is to control the outcome. For casino marketers, when you stimulate, alter or change gaming behavior, you know the event or plan was successful.
SHOULD WE OFFER MORE COMP TICKETS?
Live casino entertainment at tribal casinos and non-tribal gaming resorts are an added amenity for VIP players, tourists, and locals. If being profitable is important to you, then keeping a balanced sold to comp ticketing ratio is imperative. Unfortunately, if your venue comps too many seats it will reinforce the wrong kind of player behavior. A guest will start to hold off on buying tickets because they know you will likely be offering them a comp. Also, it is important to remember that concert tickets have value, even as a Comp. If they are thrown around and used just to fill seats, the exclusivity is lost. Over time your venue’s concert ticket will become as worthless as the arcade token that loses its value after you’ve left the arcade.
If your tribal casino is located in a high-frequency market, having too many concerts will create a saturated entertainment program and you could cause an imbalance in your ticketing ratio. If you have started selling fewer tickets and have started to comp too many, it is extremely, difficult to re-correct the ratio without shocking your guests, and suffering severe revenue loss. Some properties have a 60% comp to 40% sold ratio, or higher! And if you are going to comp that many seats, you are going to be potentially leaving new money on the table every show, especially if only a fraction of your comps are showing up (which is quite common). Nothing is less exciting to an A list celebrity than seeing the front row empty because the VIP decided not to go, is still eating in the restaurant or has left already.
UNDERSTANDING RETENTION AND TRIBAL GAMING.
What is retention? Can you really control a player’s time on the device? Our extensive research indicates a casino gambler will only leave your casino floor for one of two very simple reasons:
- They run out of money
- They run out of time
We know the aforementioned two reasons may seem lackluster, but we promise the information is very valuable. We’ve known for a while that the average casino patron at any given casino is likely to spend just over 2 hours before they run out of time or money. What does that mean though? It means that the casino can only control the patron's behavior so much before they run out of one or both of these valuable resources.
Stop doing 3 hour-long concerts at your tribal casino or non-tribal gaming facility, especially if they start late! Guide your patron’s habits by pre-planning the important details like; time, duration date, ticket prices, and other details to align with your key gaming objectives. If you intend to maximize the time your player spends on-site, it will take some foresight. Always remember to use live entertainment wisely and understand how it affects your customer base before you launch an entertainment program.
WHY YOU SHOULDN’T ALWAYS COUNT ON THE GAMING LIFT.
It is incredibly difficult to alter or change a gambler’s habits. You will see casino talent buyers and executive leadership attempt to retain gaming patrons in a variety of ways. Most tribal organizations encourage elaborate promotions or often ask their talent buyers to blindly pursue overpriced vanity bookings “to get players in the door”.
Never bank on the hopeful gaming lift the night of your concert to right-size your budget or proforma. Gaming revenue should only be considered after the fact, or separately since you can never comfortably count your chickens before they hatch.
CONSIDER THIS SCENARIO IN A 1500 SEAT CASINO BALLROOM.
If your casino talent buyer spent $125,000 for an act and the venue offers a 1,000 comps to players who all have an average daily theoretical win (or ADT) of $500, would you be able to recoup the $125,000 artists fee based on their gaming lift the night show alone?
The answer is, probably not. ADT is not actually the actual win. And it is an averaged theoretical formula that is meant to show performance from a non-singular perspective. Gaming metrics aside, let’s not forget VIPs are notorious for not showing up. Additionally, if the casinos hold is low or the player avoided the casino earlier in the week to make sure they could make it to the show on Saturday, then you have essentially overspent just to get the same player to play the same amount just on a different day. The good news is that you still have a chance with 500 leftover tickets to make up the difference with cash sales. And if you have the right act it is possible.
- Players will often skip their regular Tuesday so they can have money to gamble the day of the show on Friday or Saturday if it is a show they like.
- True incremental revenue is difficult to obtain, especially when the concert-goers hypothetical gaming is anything but a guarantee.
WHY HAVING A STRATEGY IS MORE IMPORTANT THAN HAVING AN AGENDA.
THE ONLY WAY TO CHANGE BEHAVIOR OR INCREASE INCREMENTAL GAMING REVENUE IS TO BUILD A PROGRAM THAT IS UNIQUE AND SPECIAL TO THE REGION IT’S LOCATED IN. THE APPEAL OF A UNIQUE-HIGH QUALITY ENTERTAINMENT PROGRAM WILL STIMULATE INTEREST, TICKET SALES, AND OPPORTUNITIES TO ADD VISITS.
To move toward this kind of strategy, the talent your buyer booking shows for your tribal casino must always be mindful of these two very important objectives.
- Appeal to a new gamer or Acquire a new guest. Your casino needs something to market. Marketing Food and Beverage has its purpose, but people are less likely to drive 3 hours across town to get a burger and a beer than to see Jo Koy. Nothing gets the attention of new guests more than celebrity entertainers or national touring musicians.
- Rewarding or retaining your current demographic. It is imperative to maintain interest in your core gaming demographic. Rewarding your core players with comps is the most important part of a casino entertainment program.
WHAT ARE THE TAKEAWAYS?
Tickets are a player developmental tool and if used correctly, can have a tremendous impact on a player’s loyalty.
Concert tickets are used for reinvestment purposes. A small fraction of the tickets to the biggest show of the year should go to the highest level players only, the rest should be sold to recoup the artist fee.
Your Casino entertainment program is vulnerable if you have not identified the key objectives for every show. The concert venue will be less profitable, your casinos EBITDA will plateau and your ticket holders will get confused if the talent buyer working with your tribal casino isn’t catering to your objectives.
Working with a talent buyer to reinforce a venue's reputation is valuable. Casino talent buyers also serve as a great resource to tribal members and leaders looking to develops more involved relationships within the industry. The relationship between talent buyer and tribal casino is reciprocal thankfully. The talent buyer also uses the casino’s money to build his or her reputation and feed their family as well.