Ask the Slot Expert: Boyd beancounters say "no backsies" on benefits

From the "Just Because You're Paranoid, That Doesn't Mean They're Not Out to Get You" file:

A few years ago, Boyd changed the structure of its slot club. It added two additional premium levels and changed the formulas for moving up in level and for earning points.

I met Jean Scott at the Gold Coast the week the new rules went into effect. She told me that when a casino announces a "new and improved" slot club, it may be new, but it's rarely, if ever, improved.

I say that it depends on your point of view. The club may not be improved as far as the players are concerned, but the casino sure thinks it's better.

One of her followers was visiting Las Vegas and at the Gold Coast too that day. He told her that he told the slot club booth staff that he didn't like the new rules and he would play less at Boyd and more at other casinos.

I thought, "That's kinda the idea." The new rules made it harder for video poker players to earn rewards and somewhat easier for slot players. It's easy to complain, but it makes sense to bring a player's club rewards more in line with a player's value to the casino.

Fortunately, none of the other locals casinos matched Boyd's new formulas, but then Covid hit and the casinos closed for three months. That gave them opportunity to run the New Coke play.

I had a theory that the real reason that Coke introduced new Coke was not to make a sweeter beverage that tasted more like Pepsi, it was to get people to forget what sugar cane Coke tasted like so they could switch to using high-fructose corn syrup. When Coke Classic came back, no one would realize that it tasted a little different from the old Coke they were clamoring for.

The only flaw in my theory is that Coke started using corn syrup in 1980 and New Coke came out in 1985, but I still call it a New Coke play whenever a company creates or takes advantage of an interim situation to change what they had been doing.

Station Casinos, the other major locals company in Las Vegas, took advantage of the Covid shutdown to tinker with its slot club and bring its point-earning formulas in line with Boyd's.

We hoped that some of the changes would be rolled back, but Boyd and Station are doing pretty well now. Enough players voted with the wallets and said, "Okay."

There's also another factor. There's been so much consolidation into two companies in the locals market, there's the "Where else are you gonna go?" problem. We're hoping that the club at Palms, which is opening at the end of the month, will have formulas like those in the good old days.

If you thought your offers from Boyd weren't good as they were in the past, you just might be right. In a recent meeting with a securities analyst, Boyd's CFO and Director of Corporate Finance said that there was no going back on promotions in the post-Covid climate and that the overall market was rational with regard to comps and other incentives. Boyd is also going to settle in at about 8500 fewer employees than it had before the pandemic.

David McKee, CDC Gaming Reports, wrote, "Patrons should expect fewer promotional offers and employees when visiting a Boyd Gaming casino. That was part of the message handed down by CFO Josh Hirsberg and Director of Corporate Finance Jake Mulcahy in a meeting with Truist Securities analyst Barry Jonas...Increased marketing spend was, they allowed, possible in the long-term future, but not at the expense of corporate cash flow...[management desires] to keep profit and cash-flow margins at 2021 heights."

I have not seen any changes in my offers that were not commensurate with my level of play in the past or insufficient employees at the Suncoast, but your mileage may vary.

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