People are driven by incentives. A prime example is Playstudio’s myVegas game. It’s been a wild success and is a model that can and should be more closely replicated in real casinos.
What you have with myVegas is a free game that offers real rewards. The success of myVegas is built on two things: players have the opportunity to win tangible rewards, of which they know exactly how much of their points are required to obtain said rewards, and they have set up the games to ensure that a completable goal is always, seemingly, within reach.
What keeps people playing for hours on end is the opportunity to complete certain achievements- either to level up or consummate certain tasks, earning extra points. Again, as we all know, the game is free. However, people become obsessed with the idea of completing certain goals or achieving a particular level that is just within their grasp. Players are so enamored with the idea and “pleasure” of reaching a particular goal that, instead of being patient when they run out of chips, they will voluntarily pay real money in an attempt to reach that goal sooner. This is exemplified in other “free-to-play” games popular in app stores. No doubt you or someone you know plays a “freemium” game like Candy Crush Saga or Clash of Clans. The games are free to download, free to play, but rake in millions of dollars. Why? The same reason why people pay to play myVegas. It may be equal parts impatience, self-efficacy, and incentivism. In general, people are somewhat impatient, but love completing particular objectives and are driven by tangible rewards.
How can casinos capitalize on this?
If we look at the two major loyalty programs in Vegas, MLife and Total Rewards, what we see is a limited number of achievable levels. Here is a break down of MLife and TR, with how many points it will take to reach each level:
|Gold0 *TC||Platinum5,000 TC||Diamond15,000 TC||Seven Stars150,000 TC|
|Sapphire0 TC||Pearl25,000 TC||Gold75,000||Platinum200,000||NoirInvitation Only|
There are a select group of gamblers who are incentivized to gamble more, perhaps outside of their comfort zone, and those would be the gamblers that are on the fringe of one tier, potentially close to reaching the next. Noir aside, what each program has done, is merely incentivized three small groups of gamblers out of the entire population. The biggest jumps are from Diamond to Seven Stars with TR and from Gold to Platinum with MLife. There are numerous gamblers that are somewhere in those large jumps of 135,000 and 125,000 respective tier credits. What is the incentive for a player with 16,000 with TR or 80,000 with MLife to increase their gambling? Besides the utility they receive from playing the games, not much, as their respective rewards are going to remain the same. If a player achieves Diamond or Gold status, which requires a player to spend quite a lot of money, they would have to more than double their spending to reach the next level.
In fairness, TR does have two other “levels”, if you want to call them that. TR has labeled them as “Diamond Aspirations”. Players can access additional offers at 40,000 and 80,000 points. These offers include complimentary stays, folio and airfare credits, along with upgraded transportation. These levels are not designated on the normal, advertised tier credit schedule, which is odd.
One way to possibly drive gamblers to increase their spending is an increase in the number of tiers. The more tiers added, the more people you incentivize. The tiers would still, obviously, offer additional benefits and rewards as you level up. There is plenty of room between the top two tiers of both MLife and TR, even with the “Diamond Aspirations” accounted for. Room to motivate some gamblers that are already spending decent money. Casinos spend an awful lot of resources trying to acquire new gamblers. There may be some easy, low margin opportunities to motivate an already existing customer base.
It’s clear that both TR and MLife has designated player worth based on the number of credits players have accumulated. They have obviously determined the appropriate ROI for individual players, but I have to ask, why not make the offerings more visible? TR offers the “Great Gift Wrap Up”, allowing players to spend their credits by purchasing rewards in a catalogue. What I argue for in part 2 is for the programs to increase the visibility of the rewards offered and make it easier for players not only to know the comps available to them, but to make it easier to actually redeem them as well.
“Part II: It’s all about the Tangibles” will be posted next week. In the mean time, what do you think? Do you have any major gripes about rewards programs or suggestions for improvement? I’d love to hear them. Feel free to comment here or email me at email@example.com.