Gaming operators’ priorities have changed as a result of the economic slowdown, and with them, suppliers’ orders
Everybody’s feeling the pinch, but some companies see the slump in sales as an opportunity to develop new products and services, and reposition existing ones.
ShuffleMaster’s product director for Asia, Todd Haushalter, says table games and casino products fall into two categories when times are tough: games that would be “nice to have”; and products that assist operators in their race to best practices. Purchases of the former, which include new games, are likely to be delayed during a spending freeze, he says. Whereas products that lead to new and better operating efficiencies rise to the top, fuelled by pressure to reduce expenses and maximise profits.
Nobody bats an eye when casinos are making billions of dollars a year—there is no need to worry about how many hands per hour are dealt or the odd payout mistake here and there. In such an environment, inefficiencies become acceptable, breeding complacency.
The contracting economy has since wrenched operators out of that comfort zone, forcing everybody to take a second look at their businesses.
“As an industry, gaming made so much money that it was allowed to have inefficiencies. By adopting best practices, we [operators and suppliers] are doing things we should have been doing all along,” admits Mr Haushalter.
ShuffleMaster is in a unique space in the market, he asserts, because its products meet operators’ need to reduce expenses and increase operating efficiencies.
Shufflers are a good example. ShuffleMaster dominates the category, which is being seen in a new light in the current economic environment.
“Gaming and casino operators are asking how they can get the most value out of their remaining tables: Are dealers fast enough? Is shuffle downtime significant? Should they consider putting a shuffler on the game?”
In a game of blackjack, for instance, an automatic shuffler reduces shuffling time and can increase game time by 10%, or 2.5 hours per day.
“We didn’t create shufflers for tough economic times, just like Walmart [a discount department store in the US] didn’t open in anticipation of them. The economy created opportunities for us,” he acknowledges.
ShuffleMaster is developing two new products for Asian markets which will be launched at G2E Asia. While they were not designed directly in response to the global recession, Mr Haushalter believes they will serve operators well.
One, the i-Table, is an electronic table that uses digital chips, but is played with real cards and a live dealer. “Imagine a big i-phone mounted into a table—players slide the chips around on the interactive screen with their fingers to bet,” he explains.
The result is faster play, with the potential for up to 30% more hands dealt per hour. More importantly, though, Mr Haushalter claims i-Table eliminates payout mistakes. “The risks of a dealer overpaying, mistaking a win, or miscounting a hand are impossible because the calculations are done digitally. The table knows if the player won or lost and will automatically add or subtract chips,” he explains.
The cost of human errors to casinos is significant, as was established through a comprehensive study of blackjack in California.
Over 45 days, researchers recorded a blackjack table 24 hours a day and analysed every hand using an optical recognition system called Tangam. The study found that 1.25 payout mistakes per table go against the casino in every 24-hour period.
If the average bet is US$25, those mistakes add up to US$11,400 per table per year. In a high-limit pit where the average bet is US$100-$200, those 456 mistakes per year add up to US$45,000-$90,000 per table. With 10 tables in a pit, that quickly amounts to US$450,000-plus in errors. And payout mistakes are just one example of dealer error.
By eliminating the risk of mistakes, i-Table reduces the need for supervision. Where one supervisor used to watch two or three games, they can now watch 10, Mr Haushalter points out.
“If a casino’s desire is to cut its expenses, i-Table is a product that is going to help them do that.”
ShuffleMaster will also roll out Table Master at G2E Asia, a multi-player electronic table game, classified as an electronic gaming machine that was designed to look and feel like a table.
Table Master was originally rolled out in North American markets such as Delaware and Pennsylvania that offer slot machines, but not table games. The product has since expanded its reach into traditional casinos as a lower stakes alternative to live tables.
Table Master’s broadest application is in slot halls, although it is also being used in casinos as a destination game in slots sections, near tables.
“Table Master offers a much lower entry point than the average table game and is a less intimidating way for new players to learn.”
Major Las Vegas casinos Caesars Palace, Treasure Island and others, have added Table Master to their mix. Those casinos are using the product to close down pits, claims Mr Haushalter, who summarises its appeal thus: “Table Master is open 24 hours, always shows up for work, never makes a payout mistake, and does not require supervision.”
Reliability is one selling point, but so is performance, he says: “It has the potential to perform above what five slot machines would do and somewhere below what five table game seats would do—but with no labour, card expense or errors.”
For Table Master’s Asian rollout, ShuffleMaster is adapting the product. “You can’t just take a product from the US, where it works phenomenally well as blackjack, and bring it to Asia where baccarat rules. We are going to introduce it in Asia with simpler games and much cleaner visuals,” he promises.
Mr Haushalter concedes, however, that it is difficult to separate Asian gamblers from their cards. “Asian players like to hold and feel the cards; that’s not going to change.”
Despite this challenge, ShuffleMaster is optimistic about Table Master’s prospects in Asia.
“Within Macau, a major casino like MGM Grand might take it on because it’s fun and offers a lower price point. But for markets like Vietnam, the Philippines and Cambodia, where many venues are limited to slots only, it is incredibly appropriate.”
While Table Master offers a way for operators to reduce expenses and achieve efficiencies, Mr Haushalter says it was created during robust economic times. The cost-saving aspect was a secondary consideration in its development that has now come to the fore.
“If we maintain these best practices, eventually the industry will emerge stronger and more profitable than ever,” he predicts.
