This “expiring asset circumstance” has led hotels and airlines to various sales and marketing strategies: sometimes they offer “last minute discounts” to squeeze a little more revenue from “fence sitters;” sometimes they adjust the spigots from third party booking agents like Travelocity or Expedia; and sometimes they don’t do anything except raise last minute rates and fares, accepting the underutilized capacity, but squeezing the last minute buyers.
I’m not trying to suggest that any of these expiring asset strategies are “the best.” Perhaps they all have a place on the decision matrix. But I am going to suggest that it appears our industry has no strategy when it comes to the expiring asset that casinos face every day—empty, unplayed slot machines.
I am not going to claim that I have the answer to squeezing more play from unused machines, but I am going to try and stir up a discussion that might lead back to more “butts in seats,” and not just moving players around during the day, with no real increase in revenue from these “expiring slot assets.”
So here are my thoughts:
1. You can make some strategic headway on the expiring slot asset issue by asking the question, “What would I have to do to never have an empty slot stool again?” No, you can’t have all slot machines pay out on every spin (now that would drive slot play!), but this perspective might identify some pretty aggressive and innovative tactics.
2. Yes, it is true that much “excess slot capacity” in casinos exists because of when it occurs—late, late night and early, early morning when people are generally sleeping or just getting up. But focusing on who is awake at these hours might help those slot assets expire a little less.
3. The concept of “convertible space” might help expiring slot assets but in a different way. How could that dead slot space be used in a different, but revenue-generating way? It’s difficult (and expensive) to keep moving slot machines to “repurpose” a space, but could you make it into a photo gallery? A slot nightclub (you figure out what that looks like)? A late night wedding chapel?
4. What about creating a sort of “Travelocity of Slots,” where third party vendors have a chance to fill those seats for a fee or for financial benefit? Casinos already pay slot vendors substantial “participation fees” to develop compelling slot games. Why not pay some third party vendors to find people to play them? Sure, there likely would be substantial discounting involved, but it might lead to some revenue from those otherwise expiring assets.
5. Perhaps that ubiquitous tool called free play could help expiring slot assets. What if all free play offers were only redeemable from midnight to 8:00 am at the slot machines, and were real generous? I bet that would put a few “butts in seats” and help clarify if the slot play generated by the free play was incremental or not.
6. Finally, I would think that having fewer expiring slot assets could be addressed by having better slot assets. That is, if your current slot machines paid better and allowed players to play longer, some of the current expiring assets wouldn’t exist. They would already have happier players at them, getting more “time on device,” extending their playing time, coming back more often and recommending those slots to their friends.
I know it can be tricky to create demand for those pesky expiring slot assets, especially given the graveyard times they most often occur. But I continue to believe that if airlines and hotels can breathe some life into their expiring assets, then so can some savvy marketers in the gaming industry.