Enticing Addicts

...He [Mirman of Harrah's] loved to adjust the gears of his machine to send the right offers-coupons, discount meals-to the customers who were the most motivated by them. Coupons were tracked with bar codes, gambling on slot cards.

Mirman rejoiced when roughly 75 percent of the "coin in" - a term that represented total bets made on a Harrah's slot machine- came from loyalty club members. That meant Mirman could "watch" every move made by those gamblers: when they made their bets, how much, how fast, when they took breaks, when they moved from machine to machine...

"I am watching everything. I see it all," Mirman said.

Harrah's littered its print and television ads with subliminal gambling messages ....

Harrah's made its Total Rewards loyalty program completely national so that points earned at one casino finally equaled points at anothers and could be spent like cash on anything from a hotel room to a Coach handbag - especially a Coach bag, as [Gary] Loveman served on Coach's board ....

To launch the new national Total Rewards card, Mirman and his crew of mathematicians created a "pot o' gold" promotion. Each property would have a prize, some sort of pot o' gold. "The more you play, the better your chances of winning," Mirman said, his voice rising in excitement.

"Now you notice that not at one point have I told you what the prize is. We've tested this! People get more excited by the description of how they're going to win than about what they're going to win."

By early 2000, Loveman and his crew had established , in great detail, that the players who hit the button the fastest were of far higher value than the slow-hitters. The average slot player hit it six times per minute. They delved deeper. Which denomination machine and what type of game produced the most valuable gamblers?

"Winner Takes All," Christina Binkley, pages 192-194

If we take the gambling industry's figures for granted, it would be easy to assume that only a small percentage of that $78.6 billion came from gambling addicts. That would be a poor assumption. Harrah's propeller heads discovered that 90 percent of Harrah's profits come from about 10 percent of its most avid cutomers.

Harrah's data suggests that addicted gamblers are providing a disproportionate share of all casino's profits. Which raises an uncomfortable, if moot question, What would happen to casino profits if the addicts were eliminated?

"Winner Takes All," Christina Binkley, pages 183-184

(emphasis mine)