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Yield Management: Theory & Practice at NIGA 2018

May 5, 2018

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Tangam attended NIGA’s Annual Indian Gaming Tradeshow and Convention a few weeks ago in Las Vegas. The event had over 60 sessions with 13 different educational tracks ranging from emerging gaming, regulation, security, and more. Tangam’s SVP of Operations and Casino Strategy, Ari Mizrachi, presented a session entitled, Yield Management: Theory & Practice, in the Casino Operations track.

The focus of this session was to explain the building blocks of yield management and how it can improve an operator’s table games followed by real-life examples and answers to frequently asked questions on how operators can optimize their approach.

The session started with an introduction to yield management for tables. In a nutshell, it’s providing the right product, in the right quantities, at the right price, at the right time. Ari provides a ‘day in the life of a casino’ example with varying types of customers and some insight into their needs/wants.

Introduction to Yield Management

How does Table Games Fit into your Strategy?

The session aims to answer the question, how does yielding fit into your strategy? Ari discusses how yielding is an iterative process that requires collaboration across multiple functions. In order to yield, four components are required: data collection, creating a strategy, executing that strategy and adapting. Then the process loops back to data collection.

The Importance of Data Collection

To create a strategy, Ari discusses five components that need to be considered: game mix/floor allocation, player demand segmentation, player demand forecasting, number of deal shift starts and cycle time. All of this data is available to an operator and as the chart below shows, the type of yielding strategy an operator has based on how they’re managing these five components.

Once a strategy is in place, an operator can control five levers to increase profits:

  • Table capacity - how many tables should you have? Are you servicing your demand? Is there a better game mix based on operational and financial data?
  • House edge - offering side bets and progressives, rule variations i.e. non-commission vs traditional baccarat
  • Table open hours - Player demand segmentation and optimize dealer shifts; multiple dealer shifts
  • Table pricing - usually done by Pit Managers, however, they can supervise up to 50-60 tables in some casinos. Do they have the tools they need to succeed?
  • Game pace - what is the ideal game pace for the game type and table minimum? Do the dealers need to be trained better? Dynamic vs static pricing.

The last part of the iterative yielding process is adapting. Demand can change suddenly and making changes in real-time is crucial. Depending on the strategy, a casino can adapt to changes in real-time very differently (or not at all).

NIGA Blog

By having a yielding strategy, operators can focus on the right questions about player experience, resource allocation and profits i.e. “are we yielding in a way that is consistent with our players’ expectations?” This is key to being able to provide the right product, in the right quantity, at the right price, at the right time.To demonstrate how a yielding strategy and data analysis can impact table games, Ari reviews an illustrative blackjack example and shows the results when he implements all of the components mentioned above.

Key Takeaways

  • Yielding is having the right product in right quantities at the right price at the right time
  • To yield effectively, it requires attention from a large number of people who are already short on time as it’s a complex process
  • By having a yielding strategy, it focuses attention on the right questions but without a specialized software getting an organization to execute effectively is a challenge

For all of the videos from this session, check out Tangam’s video page. If you would like to learn more about yielding management, check out some of Tangam’s available resources such as the blog and Tangam Academy.

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What Clients Say About Us

Caesars Entertainment

“[Tangam’s] real-time data gives us a deeper insight that allows us to quickly adjust to customer needs, while also establishing new business goals and tracking the success of our strategy.”

Melissa Price

,

SVP of Corporate Gaming

View Press Release

Mohegan Sun

“Reporting alone doesn't provide answers. We chose SODA for its highly differentiated offering that provides a clear set of actionable recommendations, which maximize gaming performance and the guest experience.”

Jeff Hamilton

,

President and General Manager

View Press Release

Sycuan Casino Resort

“During our initial trial, it was amazing to see how quickly we were able to get to the answers in our data through the lens of SODA. This truly made analytics available to anyone - with intelligent recommendations, intuitive visualizations and seamless drill-downs. We are equally excited about the product roadmap over the coming months.”

Sierra Weyer

,

Director of Enterprise Analytics

View Press Release

Mohegan Sun

"Extending our partnership with Tangam to our full gaming operation, including tables and slots, was a no-brainer given Tangam's proven track record of business support."

Jeff Hamilton

,

President and General Manager at Mohegan Sun

View Press Release

Sycuan Casino Resort

"Sycuan is dedicated to providing an enhanced gaming experience for our patrons. By deploying powerful prescriptive analytics tools such as TYM and SODA, our operations and analytics teams are able to get data-driven insights at the right times to drive value to our business."

Douglas Vogelei

,

Senior Vice President of Casino Operations

View Press Release

The Star - Sydney

“Due to our ongoing success with Tangam at Sydney, we’re able to deliver the right product at the right time, leading to improvements in efficiency, transparency, decision-making and our bottom line.”

David Croft

,

General Manager Product & Strategy

View Press Release

The Star - Sydney

“Due to our ongoing success with Tangam at Sydney, we’re able to deliver the right product at the right time, leading to improvements in efficiency, transparency, decision-making and our bottom line.”

David Croft

,

General Manager Product & Strategy

View Press Release

Mohegan Sun

“We’d like to thank the exceptional team at Tangam Systems for what has been a very successful implementation that we undertook together. We immediately saw positive returns and an improved guest experience. Our team is very much looking forward to continue leveraging Tangam and all it has to offer from a floor optimization standpoint.”

Kevin Lowry

,

Vice President and CFO

View Press Release
Read All Testimonials

What Clients Say About Us

Caesars Entertainment

“[Tangam’s] real-time data gives us a deeper insight that allows us to quickly adjust to customer needs, while also establishing new business goals and tracking the success of our strategy.”

Melissa Price

,

SVP of Corporate Gaming

View Press Release

Mohegan Sun

“Reporting alone doesn't provide answers. We chose SODA for its highly differentiated offering that provides a clear set of actionable recommendations, which maximize gaming performance and the guest experience.”

Jeff Hamilton

,

President and General Manager

View Press Release

Sycuan Casino Resort

“During our initial trial, it was amazing to see how quickly we were able to get to the answers in our data through the lens of SODA. This truly made analytics available to anyone - with intelligent recommendations, intuitive visualizations and seamless drill-downs. We are equally excited about the product roadmap over the coming months.”

Sierra Weyer

,

Director of Enterprise Analytics

View Press Release

Mohegan Sun

"Extending our partnership with Tangam to our full gaming operation, including tables and slots, was a no-brainer given Tangam's proven track record of business support."

Jeff Hamilton

,

President and General Manager at Mohegan Sun

View Press Release

Sycuan Casino Resort

"Sycuan is dedicated to providing an enhanced gaming experience for our patrons. By deploying powerful prescriptive analytics tools such as TYM and SODA, our operations and analytics teams are able to get data-driven insights at the right times to drive value to our business."

Douglas Vogelei

,

Senior Vice President of Casino Operations

View Press Release

The Star - Sydney

“Due to our ongoing success with Tangam at Sydney, we’re able to deliver the right product at the right time, leading to improvements in efficiency, transparency, decision-making and our bottom line.”

David Croft

,

General Manager Product & Strategy

View Press Release

Mohegan Sun

“We’d like to thank the exceptional team at Tangam Systems for what has been a very successful implementation that we undertook together. We immediately saw positive returns and an improved guest experience. Our team is very much looking forward to continue leveraging Tangam and all it has to offer from a floor optimization standpoint.”

Kevin Lowry

,

Vice President and CFO

View Press Release
Read All Testimonials