Optimization
As the industry embarks on this year’s budget and planning season, casino managers across the country are loosening their collar buttons and rolling up their collective sleeves. Most properties have long since harvested the low-hanging fruit, and making next year’s budget requires hard thinking.
In our experience, most properties have EBITDA margin upside through yield optimization initiatives or clever cost right-sizing. And in the modern day, generative AI can help move the needle.
Generative AI
In Q2 2024 we launched the industry’s first Generative AI resource, affectionately called Project AL. Named for esteemed advantage player Al Francesco, Project AL is comped of three independent modules: a generative AI model trained to personalize casino offers, a vector database with gaming specific word embeddings and a large language model (LLM) fine-tuned to interpret gaming analytics. Visit our resource devoted page devoted to Project AL.
Asset Optimization
While the hotel is often the most effective casino marketing tool, the tenuous balance between gaming and non-gaming room utilization is complex and risky. Pivoting from static room blocks to dynamic room allocation requires tackling an equation that includes lifetime value and incorporates non-gaming spend. We have supported companies across markets in developing a rigorous approach to hotel room allocation, including integration with most major revenue management systems. We have developed a suite of tools to hasten the optimization journey.
Floor Optimization
Optimizing the floor absent of a clear player strategy is just wishful thinking. We have supported operators, from one of the largest globally to a bustling casino in Manila, in optimizing their electronic gaming strategy. Our approach starts with patron segmentation and the development of districts before forming a strategy regarding constrained product and RTP/jackpot strategy. Aligning marketing and product strategy is a critical link. We have the capabilities to support the administration of this holistic approach.
Clever Cost Right-Sizing
Too often, cost right-sizing is arbitrary. A common refrain is, “We need to improve EBITDA by ten percent, so every department should cut ten percent of costs.” Instead, we help operators take a patron-centric approach, identifying lower-utility functions outside the core guest experience. For example, we recently helped a major operator right-size costs without affecting top players’ net promoter scores by clustering guest experiences into five journeys covering ~90% of revenues, protecting the key touchpoints, and focusing cost cuts elsewhere.