Keywords
slot machines; par; casino management; slot math; operations analysis
Disciplines
Gaming and Casino Operations Management
Document Type
Original Research Article
Abstract
The aim of this study was to better understand the role of a slot machine’s house advantage (a.k.a. par) in the individual player’s gambling experience. On this issue, the results challenged the inveterate wisdom of the industry. A battery of simulations comparing outcomes produced on slot machines with different pars failed to produce significant differences in play time, i.e., spins per losing player. These simulations were the first to accommodate variable wagering behavior, as identified by player tracking data donated by a Nevada casino operator. The results inform operators and game makers alike as to the ability of gamblers to detect differences in the house advantage, based solely on their results from play. This information is critical to the formulation of revenue optimization strategies, price positioning strategies, and marketing communications. Additionally, critical insight is provided on the slot machine experience, within a profit center vital to the success of many of the world’s gaming properties. The absence of significant differences in play time for individual gamblers suggests potential for gains in aggregated slot revenue, without fear of “price” detection by individual gamblers. The findings add to a growing stream of research on the impacts of pay table metrics.
Funding Sources
This work was supported by a research grant from the William F. Harrah College of Hospitality at the University of Nevada Las Vegas.
Competing Interests
Anthony Lucas has owned common stock in the following gaming companies: MGM Resorts International, Las Vegas Sands Corp., and Wynn Resorts, Limited. Dr. Lucas has also received funds from the US Department of Justice, Las Vegas Sands Corp., and FortuNet, Inc. Dr. Singh has no competing interests.