MARKETING: A parable from the machine age
March 16, 2012
In the beginning, there were only slot machines. And life was good.
Players were asked what they liked about these slot machines and they always replied, “We like when we hear the coins hit the metal bowl and we like when we can play these slot machines for a long time, without it costing us too much.”
Soon, however, many changes swept over slot machine land. The owners of the slot machines discovered that players could play faster if they could put currency into bill acceptors on the slot machines and use “credits” instead of coins. They realized players didn’t have to pull an awkward handle to play these slot machines, but that it was more convenient (and faster) to use a spin button to play.
And still life was good. Players came to like the new features of the slot machines, as they could play faster, not get their hands dirty, and be free of lugging heavy buckets of coins to a slot cashier. Yes, winnings from the slot machines were now paid with tickets instead of coins.
Soon, slot machines were enjoying immense popularity. And when the owners of the slot machines asked players what they liked about these new, improved slot machines, the players responded, “We like when we see the credit meter racking up slot machine credits after winning spins and we like when we can play these slot machines, for a long time, without it costing us too much.”
And still life was good.
But trouble began brewing in slot machine land. Owners of the slot machines started looking for “new revenue streams” and began building restaurants, and hotel rooms, and spas, and shops around these slot machines that players liked so much. And to pay for these new and fancy things, the owners of the slot machines looked for ways to make more money from those very same slot machines.
These owners found that they could offer something unheard of, “one-cent slot machines,” where players could actually bet more money, have more winning spins, and still lose money faster than before. “What a concept!” they thought.
They found that they could have the slot machine’s reels spin faster and produce a result sooner. They found they could have 2, 3, 5, 10, 50, even 100 (!) slot games play simultaneously on one slot machine. They discovered that they could have fewer slot winning spins on progressive jackpot slots and on expensive slots with fancy names made famous in movies; on cheaper-to-play slots; on slots in high traffic areas where it was hard to find a seat; and on slots in places where there were no other slots around for 50 miles or more.
And when the owners of the slot machines asked the players how they liked the new slot machines with fewer winnings that helped pay for all the other stuff, the players replied, “We like the slot machines where we win more often and we can play for a long time, without it costing us too much.”
And life was beginning to be not so good.
And then the owners of the slot machines saw that the players appeared to be growing weary of the slot machines with fewer winnings. So they started giving rewards to the players who played the slot machines. They gave them meals and merchandise and free rooms and other things that they had built by having less winning on their slot machines. Some owners even gave cash rewards to the players while others gave free play on the slot machines with less winning.
And to pay for all of the rewards, the owners decided to have even less winning on their slot machines.
When the owners asked the players how they liked the slot machines with even less winning, the players loudly replied, “Are you crazy???”
And all was definitely not well in the land of slot machines.