Mocha Clubs President Constance Hsu shows us around her company’s latest venue and explains how Mocha got table-loving Chinese gamblers to give slots a go. It is the latest instalment of IAG’s video interview series with leading members of the Asian gaming industry.
Cslot club operator Mocha Clubs, took Inside Asian Gaming Publisher Kareem Jalal on a tour of her company’s recently opened ninth local venue, Mocha Macau Tower. The new club offers 260 electronic gaming machines in Mocha’s characteristic cosy coffee-shop style surroundings.
Mocha Clubs was the first company to push electronic gaming seriously in Macau. Before the opening of its first venue in 2003, slot machines in Macau were viewed as merely decorations at the table-dominated casinos. Worst still, they were seen as a bad deal, leading to slots being referred to as “hungry tigers” in Cantonese. Mocha worked hard to shake off that perception, showing Chinese players that slots were not only fair, but also offered strong entertainment value.
Mocha’s keen attention to service and local game preferences has allowed it to compete in the face of fierce competition from the slots areas at Macau’s glitzy new casino resorts. As president of Mocha since 2008, Ms Hsu has overseen the company’s strategic expansion to control 1,800 electronic gaming machines across the city. Mocha also boasts a slick player rewards scheme and one of the best returns to player on its machines in the whole of Macau.
Kareem Jalal: For those not familiar with the history, can you tell us the history of Mocha?
Constance Hsu: Yes, sure. In 2003, slot revenue accounted for less than 1% of Macau’s total gaming revenue compared to over half of the casino revenue on the Las Vegas Strip. There are several cultural explanations for the aversion to the slots in Macau, such as the supposed preference of Chinese to engage in intense face-to-face battles against the house and their belief that they can influence the outcomes at tables by spotting the patterns and picking the lucky cards or numbers, whereas when they play slots they leave their destinies to cold computers. However, from our point of view, the main reason for the non-performance of slots in Macau was a lack of quality product offerings, service, and comfortable ambience.
Was it also trust, because they [the players] didn’t believe that they [slots] were fair?
Maybe, so when we opened the very first Mocha Club at Hotel Royal in 2003, we blended a coffee shop-style with the gaming area for the patrons. About one third of the area was used as a mini-bar area with high-rise coffee tables and stools. And music, coffee smell, and the sound of the machines surrounded the whole venue.
As for product offerings, we were the first in Macau to bring the electronic table games, such as sic bo, electronic baccarat and electronic roulette. These electronic table games—also known as multi-terminals games—made up about 70% of our total installed base during the first few months of operation. The rest of the floor was occupied by linked progressives and standalone slot machines. As those multi-terminal players became accustomed to playing on machines and they saw some of the slot players winning jackpots, they began tentatively approaching the slot machines.
In the beginning, linked progressives were the most popular slots, but how have slot preferences been evolving since 2003?
By 2006, there had been a steady shift from multi-terminals to slots, and multi-terminals made up about half of Mocha’s installed base and revenue with the other half coming from slots, though largely weighted towards the linked progressives, with the players eager to win the big jackpot.
The shift in preferences continued with standalone slot machines in particular having made strong gains over 2007 and 2008 to the point that between multi-terminals, linked games, and standalones was even, with each commanding about one third of both installed base and revenue. As of today, multi-terminals makes up about one fourth.
Only 25%?
Twenty five percent of Mocha’s installed base and revenue. Of course, the rest comes from slots, but slightly weighted towards standalones.
Mocha Clubs offers a distinct value proposition to that of the big casinos. How are you faring in the face of competition from those casinos and how are you trying to set yourself apart?
I think Mocha Clubs is a string of trendy and cosy outlets focused exclusively on electronic gaming. Currently, we have nine outlets across the Macau peninsula and Taipa with over 1,800 machines in operation. Well, accessibility, the non-casino ambience and unique product offerings are all comparative advantages. I think personal service and proactive responsiveness to players’ needs is the key to differentiate Mocha from big casinos. We have always been very innovative and customer-oriented. In addition to the pioneering use of the multi-terminals and the opening of VIP slot lounges in Macau with more privacy, more personal service, exclusive jackpots, we were also the first gaming operator in Asia to implement a player tracking system. This enables us to have a more comprehensive understanding of the preferences of our members. What they like, why they like it—especially, when our patrons are loyal and regular players, they are not one time players.
Giving customers what they need takes the form of product selection. Although our patrons choose games according to the underlying math and volatility, they tend to stick to their tried and trusted favourites. There are quite a few machines that have been offered at Mocha Clubs since the early years, and you can see those machines at Mocha only.
Can you tell us more about how you keep your players loyal?
Yes, I think, loyalty is the most valuable asset that we could ever have. The likes of the big casinos have a much greater range of in-property offerings to draw on for their rewards programmes. Because of our constraints, we always have to think out of the box to find some more innovative giveaways to our patrons. We have established a very strong network with external vendors, from petrol stations, supermarkets, popular Chinese restaurants, popular dessert houses, to the suppliers of optical products and Chinese delicacies such as bird’s nest. I can say that Mocha Clubs provides the most variety of redemption items to our members.
And also with our comparatively cosy venues, we cultivate a club atmosphere. Our membership card is more like a private club than a casino loyalty program. Our staff will greet customers when they come in by name and they have memorized the preferences of the patrons from their favourite games to their favourite food and beverage. We try to make every visit of the patrons as treasured and enjoyable as possible.
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In addition, we provide a wide range of privileges and benefits to our members, from hotel rooms, shows, restaurants of our sister properties, ferry tickets, meals at local eateries, and discounts at a variety of shops to the personalised special redemption items.
We also host regular and seasonal gatherings tailored to different tiers of members, such as dinner gatherings ahead of major festivals, hairy crab feast, etc.
Mocha Clubs’ parent company, of course, is Melco Crown, which also operates City of Dreams and Altira. Do you have any plans to work more closely with Melco Crown going forward?
Yeah, definitely. Actually, we had been working very closely with City of Dreams and Altira to leverage on all the resources and amenities of Melco Crown to maximize the value that we can offer to our patrons. Not long ago, we launched our joint slot tournament where we had over 100 VIP players from Mocha Clubs and the Signature Club of City of Dreams during the competition, and the feedback is very positive. I think we will still keep working very closely to have more synergies and to provide a more premium gaming experience and more entertainment choices to our patrons.
