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How casinos get you to spend more money

99 pointsby bennesvigalmost 11 years ago

12 comments

oscilloscopealmost 11 years ago
An interesting experiment in gambling addiction was the Bitcoin betting site Just-Dice. There were two ways to participate:<p>1) Choose your bet size and chance to win. The house always had a 1% edge, reflected in the payout. This edge is much lower than slot machines in Vegas.<p>2) Invest in the house. Every bet affected your bankroll based on your % invested relative to the total bankroll. The house edge was on your side.<p>The operators of the site, Deb and Doog, encouraged anyone trying to make money to invest. They argued the expected value was positive, even though high-rollers sometimes went on winning streaks.<p>Despite the warnings&#x2F;statistics Doog produced and the fact that there was a +EV way to play (investing), players still got addicted to the dice game itself. The rolls resolved in a fraction of a second, so some players would go on a tear and bet 3-4 times a second. The minimum payout was 1% of the house bankroll, so single bets of several hundred bitcoin were possible.<p>Several high-rollers (&quot;whales&quot;) played for 14-16 hours straight in a state of intense &quot;flow&quot;, generally winning early on and losing everything by the end. Sometimes hundreds of thousands of dollars of bitcoin (1000+ btc) lost in a single session. Sometimes coins would come out of cold storage to continue playing. The site had a chatroom where even investors encouraged the player to stop before they were ruined, but the players would generally deny addiction and continue rolling.<p>After losing it all, some players described the experience they were having as a chemical rush- as if they had just taken a drug.<p>Even users who were invested and had made sizable profits from investing were not immune to the lure of the game. Several withdrew their invested bankroll just to &quot;play around&quot; and fell in the same inevitable fashion.
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doomlaseralmost 11 years ago
The straight-up gambling industry relies on whales in an eerily similar way to many f2p games.<p>From the linked WSJ article [1]:<p>&quot;The Bwin data also offer a peek at the economics of the casino industry that only insiders normally glimpse. Among the findings is an extreme reliance on revenue from a small number of gamblers.<p>Of the 4,222 casino customers, just 2.8%—or 119 big losers—provided half of the casino&#x27;s take, and 10.7% provided 80% of the take.<p>Such revenue concentration long has been quietly acknowledged in the casino industry, but the Bwin information may be the first to show it with hard public data.&quot;<p>Compare that to the f2p industry. From Re&#x2F;Code in February [2]:<p>&quot;In a mobile monetization report released today, app testing firm Swrve found that in January, half of free-to-play games’ in-app purchases came from 0.15 percent of players. &quot;<p>&quot;Some game companies talk openly about the fact that they have whales, but others shy away from discussing them publicly. It costs money to develop and keep a game running, just like those fancy decorations and free drinks at a casino; whales, like gambling addicts, subsidize fun for everyone else.&quot;<p>[1] <a href="http://online.wsj.com/news/articles/SB10001424052702304626104579123383535635644" rel="nofollow">http:&#x2F;&#x2F;online.wsj.com&#x2F;news&#x2F;articles&#x2F;SB1000142405270230462610...</a><p>[2] <a href="http://recode.net/2014/02/26/a-long-tail-of-whales-half-of-mobile-games-money-comes-from-0-15-percent-of-players/" rel="nofollow">http:&#x2F;&#x2F;recode.net&#x2F;2014&#x2F;02&#x2F;26&#x2F;a-long-tail-of-whales-half-of-m...</a>
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kensalmost 11 years ago
I read a paper a while ago that explained a bunch of tricky design that goes into slot machines. The odds of a particular symbol on a reel showing up aren&#x27;t uniform - they use &quot;virtual reels&quot; behind the scenes. The reels are designed to show a lot of &quot;near misses&quot; where you almost win. They have a lot of partial &quot;wins&quot; that pay less than you put in. They &quot;nudge&quot; reels so it looks like you&#x27;re getting closer to a win, but the odds don&#x27;t change. They arrange the reels so you see a lot of &quot;good&quot; symbols, but not in places that actually help you.<p>I&#x27;m not sure this is the paper I read originally, but it explains all this in detail (ignore the dodgy domain name): <a href="http://stoppredatorygambling.org/wp-content/uploads/2012/12/PAR-Sheets-Probabilities-and-Slot-Machine-Play-Implications-for-Problem-and-Non-Problem-Gambling.pdf" rel="nofollow">http:&#x2F;&#x2F;stoppredatorygambling.org&#x2F;wp-content&#x2F;uploads&#x2F;2012&#x2F;12&#x2F;...</a>
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GuiAalmost 11 years ago
I come from a country where casinos are much rarer than they are in the US, and I recently went in my first casino ever after living in the US for 4+ years.<p>So I entered this weird place in Montana, with colorful machines everywhere. A more experienced friend instructed me to play a certain machine, in which I put $5 and got 100 virtual &quot;tokens&quot; in exchange. Then the machine asked me to pick 7 random numbers from a 10x10 grid. I touched the 7 numbers, and pressed a flashy &quot;Go&quot; button. The machine &quot;randomly&quot; (of course I have no certainty that it was truly a random process) picked 7 numbers, and only 1 of mine matched. Total gains: 0. I repeated the process several dozen times: select your numbers, press a button, watch the machine make funky sounds as it &quot;randomly&quot; selects number, see if yours match. The best round I got was when 3 of mine matched, and I got back something like 10 credits, going from 47 to 57. 10 minutes later, I was at 0.<p>It strikes me as a tragedy of our modern society that such contraptions make for a significant portion of state income, and that they are as popular as they are. It is sad that the average American citizen does not have a sufficient grasp of basic probabilities to even consider putting money in such a machine, because it means that the school system essentially fails at preparing kids for the real world. And it is sad that governments are encouraging those temples for theft to prosper the way they do. Because it really is theft - just a kind of theft where the victim is coaxed into it with the help of smoke, mirrors, and free booze (not unlike the phone scams that prey on the elderly and manage to extract thousands of dollars from them). And not only is it institutionalized theft, it is institutionalized <i>classist</i> theft, as the vast majority of the victims are from the lowest socio-economical classes of society.
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FreeKillalmost 11 years ago
From a software&#x2F;hardware engineering perspective, how difficult is it to get into the slot machine game? I imagine it must have quite a rigorous set of guidelines and testing procedures that must be followed diligently to avoid running afoul of regulations set out by gambling states.<p>Also, I assume it must require a lot of trade show visits to try and sell major casinos on your machine, since the number of customers for your machines is severely limited. Is it an upfront cost business (aka, they pay you $XXX for each machine) or is it more of a partnership with the makers where the casinos share profits on the machines with the developer&#x2F;designers? Off the top of my head, I&#x27;d think the latter would be more feasible as I&#x27;m sure popularity of machines must be somewhat short lived, as there always seems to be different machines all the time.<p>Anyway, I&#x27;m curious if anyone with more experience in this area could give some brief highlights on what it&#x27;s like working in that arena. I&#x27;ve always been curious :)
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leeoniyaalmost 11 years ago
pardon the hijacking, but what&#x27;s with this trend of everything above the fold looking like an entire complete page with almost no content? half the time i land on sites like this, i sit there for 5 seconds wondering where the hell the content is. the scrollbar is <i>not that visible</i>, guys. if i dont see partial content hiding at the bottom of the fold which would clue me into the fact that there&#x27;s 10 more pages worth of scrolling, i&#x27;m not gonna &quot;get it&quot; by noticing a scroll bar.<p>the pretty UI is not worth the horrid UX<p>EDIT: i think repliers are focusing too much on scrollbar visibility. this isnt the main issue. i have no problem with the scrollbar being visible on other sites. it&#x27;s plenty visible on my Win 8.1 &#x2F; Firefox 1080p res. The problem is that A) i dont want to scroll an entire page before i begin reading and B) i dont want it to be the primary (and sole) indicator of additional content. I have to look over to the side to get the only cue, it&#x27;s really annoying.<p>&#x2F;rant.
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downandoutalmost 11 years ago
All of this is interesting from an engineering perspective, but the reality is that casinos don&#x27;t have to use engineering to get you to spend money. They rely on addiction for their income, and there&#x27;s no evidence that better slot machine technology has swayed addiction rates one way or another (although TITO - ticket-in ticket-out - has made it easier to lose one&#x27;s money faster). According to one study, 2.8% of the player base accounts for 50% of net casino win; the top 10.7% provides 80% of the win [1]. Without the very small percentage of their visitors that become addicts, every casino on the planet would cease to exist in short order.<p>[1] <a href="http://online.wsj.com/news/articles/SB10001424052702304626104579123383535635644" rel="nofollow">http:&#x2F;&#x2F;online.wsj.com&#x2F;news&#x2F;articles&#x2F;SB1000142405270230462610...</a>
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spacefightalmost 11 years ago
&quot;Alternatively, Schüll discovered, some video machines actually make internal adjustments if they notice that a player is on a losing streak and is reaching their &quot;pain point.&quot; This has to be done carefully — it&#x27;s illegal for casinos to change the odds in a game once a player has started playing. But, she says, casinos can reduce the volatility of a game in a way that still preserves the overall payback percentage. That&#x27;s technically still legal.&quot;<p>Yeah, right... technically legal but that sounds totally rigged to me.
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fiatmoneyalmost 11 years ago
I would heavily recommend the book they mention (&quot;Addiction By Design&quot;). In addition to the bits about the casinos, there are a lot of fascinating insights into the minds of committed slot machine gamblers.
wmtalmost 11 years ago
Strange that adding smaller wins to slots has only just arrived, as such more complex betting systems have been proven to make playing feel more rewarding for decades.<p>E.g. in Finland all supermarkets and roadside cafes have slot machines, and complex betting tactics described in the article have been there at least from the 1990s. They do differ a bit from Vegas slots, as the profits go to charity and the jackpots are ~50€, but still they are carefully designed to maximise the profits on the long run.
netcanalmost 11 years ago
I like the choice of &#x27;story&#x27; or &#x27;full interview.&#x27;
unsignedintalmost 11 years ago
So some thought about this, as I used to be regular of a local casino, not because I felt I had to go, just to play with cash vouchers, they used to send, maybe occasionally putting in a 10 dollar bill or two. I didn&#x27;t make money out of it, but I did not lose my own money. I guess when they realized they are not making money from me, they stopped sending me those vouchers... Bummer! :-)<p>Those machines are really designed to salami slice players. You can play many of those machines from a penny per line, which equates to about 15 to 30 cents per play for full lines, depending on a machine. There are people who play at higher stakes, like a max bet of $2 per play, or even $5, but observing people, majority seems to be played at much lower bet of a penny or two per line, so I&#x27;m guessing they consists of high fraction of profit a casino is making from.<p>It&#x27;s fairly easy to lose a sense of spending when you are doing literally a thousand play per hour. (At 30 cents per play, You&#x27;d be spending fairly long time to spend $20, or even $10. At this level, a typical win would get you around $2 to $5, maybe $40 if you are quite lucky -- and perhaps real jackpot, being very, very rare, $200 or so.) Those &quot;wins&quot; really give you the joy that you&#x27;d anticipate for the next, and a lot of time, they&#x27;d put more money in just to anticipate another win, because when they have lost plenty of money, it&#x27;s about a time they will start winning, right?<p>Knowing someone who really got into it, one sign I started seeing from them is that they&#x27;d start making a statement like &quot;I&#x27;m not playing it for money, I play it because the game is fun.&quot; He would play the game literally for hours per session, often visiting there multiple times a week. Usually ends up losing -- maybe the only good thing is that he&#x27;d have accumulated quite a bit of free restaurant credits.<p>So if you are inclined to play, here&#x27;s some suggestions, though for those people who would feel these suggestions are useful probably find the best is not to play at all:<p>1) Set a budget -- don&#x27;t bring extra money. (And don&#x27;t bring ATM card&#x2F;credit card if you feel like you can&#x27;t resist getting extra money out of them...)<p>2) Record every win&#x2F;lose -- I&#x27;ve had Google Doc that keeps track of every wins&#x2F;lose every machine. Every time I cash in, I&#x27;d record, every time I cash out, I also record that, that would give me balance sheet how much I&#x27;m spending&#x2F;making.<p>3) Bet generously -- Don&#x27;t bet a penny per line, go higher. You won&#x27;t go anywhere with such low bet anyways. You&#x27;ll have a better chance getting a better outcome going through that $20 in 2 minutes than spending 2 hours on it. Yeah, it may only last 2 minutes, but then you have good reason (See #1) to leave at that point -- and you are giving less chance for a machine to alter your psychology.
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