An interview with a casino CEO

"There are three ways to get fired from a casino:  theft, sexual harassment, and running an experiment without a control group" says Gary Loveman, the CEO of Ceasars. Gary used to work for the Fed Reserve and as an economics professor at Harvard Business School, yet today runs one of the largest casino companies in the country. At the heart of the discussion is what casinos do to entice new customers to increase business and also how do they retain those customers.  As a business, they are constantly analyzing data on customer usage and demographics and conducting experiments to see what works and what doesn't.  They are thus able to know what customers to offer free dinner, VIP night club passes, or hotel rooms to.  As an example, customers using their "loyalty cards" in the casino give real time data that the casino is able to use to adjust the customer experience on the fly.  On average, casinos pay out 90% of what is earned.  If a customer earns more than that, the casino loses money.  If a customer earns less, they get annoyed and don't want to come back.  So, if a customer is at the casino and is losing money on a slot, Caesars is able to recognize this, notify someone on the floor, and have an employee go up and offer that customer something to improve their experience (free dinner?) and increase the chance of them coming back.

I'm not a big fan of casinos or gambling in general, but I must say I'm quite impressed at how this data is being used.  It's also a little scary when you start pondering how much data companies have on everyone today, and the ways the smart ones can start taking advantage of it.  Big money is on the line for those companies that do this well.

Listen here (starts about 2 minutes in and runs for 20 minutes or so)