Casinos Respond to Tough Economic Gaming Climate

They're never going to hold a "tag day" for casinos, even in today's battered economy. Sure, the revenues are down for many properties across the country. But it doesn't mean they're not making money; they're just making less than they did when times were good.

Response from the individual properties has varied, but over at Harrah's Casino & Hotel in Joliet, the accent has been on evaluating its inventory of games and making the adjustments necessary to weather the storm.

"Our big focus lately has been some of the two-cent, five-cent and even some penny games," said Philippe Khouri, vice president of operations. "We've been aggressively going after some of the lower denomination product that's popular and has the 'legs' that we look for."

It's not entirely a reaction to the business climate according to Khouri, who observed: "Obviously, revenues have been down year over year, but regardless of that there's a natural migration toward the lower denomination games."

The inventory of such games has increased slightly this year at Harrah's Joliet, but the trend is likely to continue in the near future.

"We haven't made a big, concerted effort to change out by the hundreds, but we're slowly migrating," Khouri said. "We've been adding maybe 10 to 20 two-cent games a quarter. It's where the player demand is."

Low denomination games, especially the pennies, are the new darlings of the gaming industry. They are major components of virtually every casino's slot machine inventory and represent a major portion of gaming revenues, even at some of the bigger properties.

The higher house win generated by low denomination games, coupled with the greater percentage of them found on casino floors, has contributed to an overall decrease in theoretical slot payback at many properties.

The shift in slot machine dynamics has sparked renewed interest in the table game component at Harrah's Joliet. The popular table game Let It Ride was added, and Khouri said that approval for a few other games has been submitted.

"We're not really sure at this point if we're going to add them or not," he said, "but the goal is probably to increase our table game count. We're up to 25 now, and we'll probably go to 26 sometime this year."

The economic climate has even prompted talk about live poker at Harrah's Joliet, which will be the only casino in the greater Chicago area to not offer it once the room at Grand Victoria Casino in Elgin opens.

"As we've seen these decreased volumes, it (live poker) certainly has come into question again," Khouri said. "Part of what we're also looking at in the future is getting PokerPro (automated live poker). That would be something we would be more apt to try.

"We know if we put poker in it's going to be popular. Every month we're leaning more toward adding it because of the state of economy and the fact we're not fully occupied on our slot machines any more."