Customer reinvestment analysis in the gaming industry

Abstract

PurposeOver the past several years, the term “Player Reinvestment” been used more frequently when describing the money and effort casinos expend in retaining profitable gaming customers. Most often, player reinvestment refers to the suite of benefits and offers that casinos give to various segments of their databases. The purpose of this paper is to examine the concept of player reinvestment.Design/methodology/approachThe paper draws on the author's experience in the gaming industry as well as studies that have been done by his organization, Gaming Market Advisors.FindingsThis paper provides definitions for the components that make up player reinvestment, and how casinos measure those costs and the benefits that these investments contribute to their revenue streams. Further, the paper shows the range of expenditures that casinos in the US gaming market expend on fostering customer loyalty.Practical implicationsThis paper is written by a gaming industry executive for gaming industry managers. It contains conceptual as well as specific information on how to manage a player reinvestment program.Originality/valueThe player clubs in casinos have to be looked at as an investment to bring existing players back to the casino. This paper explains the concept of player reinvestment, an emerging practice in casino management.