Does true loyalty pay?

16 June 2018

By Eric Rosenthal

Casinos offer players clubs in order to create brand loyalty and keep gamblers coming back to the same casino or casinos within the same network. They create perks and benefits as one ascends through the ranks of their tier-based programs. Many gamblers feel a sense of loyalty because of this treatment or enhanced experience, but it is only one part of the equation.

Casino marketing departments use the term “reinvestment” to describe the comps and offers that will be provided to players in order to bring them back after they’ve been away for a certain period. This reinvestment is a percentage of expected future theoretical loss or actual previous loss based on some time frame. For larger players, these offers can be far more lucrative than the benefits gained from a loyalty program.

High-activity players who come often find their reinvestment drops after a while. Why does that happen? Casino marketers believe that they do not need to give as much because brand loyalty has already been achieved. In other words, casino marketers do not think they need to offer as many inducements to get a brand-loyal player back into the casino. But when a usually frequent player stays away for a certain amount of time, reinvestment increases to try to lure that stray back in.

Casino marketers are hoping that frequent players will settle into brand loyalty without further inducement; at the same time, they are making stronger-than-usual offers to players who’ve not come by in while. So, casino marketers are constantly trying to strike the right balance between building a strong customer base and keeping down marketing costs.

But forget about the marketers. From a player’s point of view, which is worth more? Reinvestment offers or tier-based program benefits? That’s very much up to the individual.

In general, a larger player who puts more at risk is likely to see offers from marketing that are worth more than tier-based benefits. But a smaller player who goes often will likely get more out of frequent use of a perk or benefit than a drop in marketing offers would cost. The differential between the two types of benefits for all players (large or small) depends partly on how many local options are available. The more options there are, the greater the differential (more so for the larger player).

Does the player have a relationship with a good host that can make up the difference in declining marketing offers? This is another factor that the player must consider when deciding whether to prioritize reinvestment offers or loyalty program benefits.

Having played the marketing game and the loyalty game, I’ve opted for more variety in different destinations with different casino brands, and my offers are about as good as they’ve ever been.

The interesting wrinkle is that solid players with good host relationships can request to have their tier matched or granted a higher level tier based on their play. Showing solid action and being a good guy or gal can get you the best of both worlds. This discretionary power to match or boost loyalty tier benefits varies from network to network and from host to host. Invest time in finding the right people to work with, and it will pay dividends for years to come.


Eric Rosenthal is a co-host on the "Vegas Confessions" podcast and is a featured speaker at ZorkFest, a casino comps and travel rewards conference.