

How Casinos Can Find and Target Their Favorite Customers: The Biggest Losers - newmediaclay
http://knowledge.wharton.upenn.edu/article.cfm?articleid=2239

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Tichy
The article does not actually say how (or did I miss that)? It is just saying
"some researchers have tried to create a mathematical model for predicting who
are the biggest losers", and taking several paragraphs to say that.

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patio11
Casinos already have _extensive_ systems for doing this through their loyalty
card programs, where in return for getting comps (non-monetary incentives to
frequent their casino, such as dinner on the house or a free hotel room) you
give them observational powers over your gambling that resemble those
possessed by the NSA in a Hollywood spy flick.

They're some of the most ruthless users of CRM (customer relations management)
technology in the world.

See generally:
[http://archives.cnn.com/2001/TECH/industry/07/03/casinos.crm...](http://archives.cnn.com/2001/TECH/industry/07/03/casinos.crm.idg/)

(Bonus points for being written back when a 200GB database was impressive. :)
)

I assure you that they don't need academics to tell them who the biggest
losers are -- theories are fine and dandy, SQL queries make the world go
round.

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JabavuAdams
I wonder whether the researchers have thought through the ethical implications
of this.

I've worked in the gaming industry, and I'd consider this predatory.

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dmoney
By targeting the worst players based on information stored about them in a
database, it seems that they are doing the same thing a player would be doing
if s/he counted cards and bet high at a time when s/he was most likely to win.

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JabavuAdams
No. The odds are already in the casino's favour, and the casino has more
information than any of the players do.

What they're doing here is identifying suckers, and further exploiting them.

AFAIK, I don't know anyone with a gambling addiction, but when I hear the
retarded ideas that people have about how probability works, it gives me
pause.

We're a select group, here on HN. Many of us took math classes beyond the
first couple of years of high-school, and a lot of us went to university.

The average person out there is at a severe disadvantage, especially when
powerful corporate interests are exploiting well-known cognitive deficiencies.

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stcredzero
Hmm, what would be the analogous strategy for dating sites? Finding the most
unhinged desperate losers and the unacknowledged hookup junkies?

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menloparkbum
One of the most financially successful "dating" sites, Adult Friend Finder,
targeted those very groups: unhinged losers and hookup junkies.

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stcredzero
I wonder if those who so abhor paying for a social safety net secretly want
life's losers to wither away and die? (But leave behind a lot of their money
to bilkers on the way to the grave.)

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xenophanes
Maybe they could get jobs.

And they can't whither away and die while having money for us to take. If they
still had any money they'd buy food. No matter how few friends you have, and
how socially awkward you are, people will be happy to sell you food.

~~~
stcredzero
In particular, I was thinking of the working poor. Many of those are still
"losers." It's hard for many of those people to get other than crappy
healthcare, crappy food, crappy housing, and crappy education for their kids.

It's interesting coming out with a thought 3 or 4 concepts away. It's
interesting to see how people fill in the gaps, and what they project onto
you.

The principle I was thinking of -- those willing to cause consensual suffering
and misfortune. I suspect that some take the laissez-faire stance in order to
ensure that they don't run out of downtrodden suckers.

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chris11
On a semi-related note, does anyone here count cards? I'm slightly interested
in teaching myself sometime.

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RiderOfGiraffes
Do you mean for Blackjack? I have done so, computing for myself first the
optimal playing strategy (which mostly agreed with the published ones) and
then running millions of simulated hands to see whether the assumptions made
were sufficiently accurate. They were.

There's plenty of stuff on the net, and you can compute it for yourself. If
you don't, then you're blindly following someone else's advice, putting your
money on their advice without necessarily understanding what you're doing.

So, with that in mind, how can I help you?

~~~
chris11
Yeah I was thinking about blackjack. So what did you end up with for a profit
margin with you strategy? Looking at articles it seemed like your advantage
while counting cards is razor thin. And computing an optimal playing strategy
just requires some basic knowledge of statistics, right?

~~~
RiderOfGiraffes
Basically, BJ is around 50%. You win slightly less than half the hands, but
some hands give you higher payoffs (doubling, BJ itself, etc). Card counting
lets you move the odds by a few percent. If the deck goes in your favor, you
then increase the size of your bets to recoup your losses and make a small
profit.

The margins are slim, but real. The deck goes in your favor about 10% of the
time, so you have to multiply your bets 10 fold to break even (ish). This gets
noticed, they reshuffle, and you lose your advantage before you recoup your
losses. You ened "social" strategies to beat that.

I've been meaning to write up my experiments for some time, but I've been
reluctant 'cos there's already so much on the web about this.

Have you checked what others have said? Why are you asking? What are you
trying to accomplish?

Computing an optimal playing strategy is simple with a spreadsheet, once you
take into account all the baroque rules. Don't forget, different casinos have
different rules. Some let you split multiple times, others don't. Some let you
double-down on 8, some don't. Etc.

It all depends on what you're trying to achieve, and how much reading you've
already done.

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xenophanes
do the casinos make more off people who play slots or table games?

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anamax
Look at what dominates the floor space.

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xenophanes
So, which?

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rms
I would think it is table games not because of floor space, but because of
high rollers. No one is playing slots for $50,000 a spin.

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sokoloff
There's basically no labor component to slots (there's some maintenance I'm
sure), making slots far more profitable on a $ take per square foot basis.

This is anecdotal, but I've never seen a casino tear out slots to put in table
games (on a net square foot basis), but plenty of casinos in CT and NV have
removed table games to add slots (frustrating as a poker player).

