Introduction to Slot Machine Analysis

The continuous development of new tools for analysing machine performance and profitability metrics, the constant advance of communication technologies and their application to the casino environment, as well as the advent of complex systems for modelling and predicting player behaviour in order to optimise the gaming room’s product and service offerings, require the industry professional to have a solid theoretical background in the fundamental aspects on which these concepts are based.

In this sense, we must mention that it has been the companies in the sector themselves, whether they are gaming operators or equipment and/or systems suppliers, who have finally begun to understand the fundamental importance of this type of analysis and advanced metrics, both for the daily operation of the business, as well as, and above all, at the time of making major investment decisions, such as the acquisition of new machines, progressive machines or management systems. It is precisely for this reason that, in recent years, a new figure has begun to emerge strongly within the organisational structures of these companies: the gaming analyst.

Although this position has existed for decades in the organisational charts of the main American gaming companies, under the title of Slot Performance Analysts, it is only in the last couple of years that the most important groups of gaming companies in our country, one of which I belong to, have begun to develop this speciality within their Operations Departments. This is quite striking, since many of our companies have always referred to American organisational models for the conformation of their operational structures.

If the reader will allow me to digress a little, I cannot help but recall the expression of surprise and bewilderment on the face of my current boss when, in 2009, I asked him how we could improve our operational efficiency and proposed to find a graduate in statistics to create this new position with him. Although the idea was dismissed out of hand at the time, only a year and a half later, I had the opportunity not only to hire that person, but also to set up a complete department, with eleven other people, to carry out that function. Today, that Department is fully active and serves several of the group’s casinos, where similar Departments are being developed. 

Some of the tasks and responsibilities of this type of department are typically:

  • Collect, conform, standardise and compile all the information coming from the different computer systems that provide information regarding the different gaming and slot machine collection parameters currently operating in the casino, as well as that coming from other sources not yet computerised (e.g. ticket softcount, technical reports, etc), which is relevant and necessary for a complete control, reconciliation and optimisation of the casino’s gaming operations.
  • To prepare the daily, weekly, monthly and annual reports required by the different areas and/or departments of the company regarding the different operational parameters of gaming and the movement of values related to these operations, in the formats and times established for each one of them.
  • Permanently monitor the networks and/or computer services corresponding to the systems under his/her supervision, taking all necessary and pertinent actions to guarantee their continuous and uninterrupted operation.
  • Audit in real time all critical events of slot machines operating in the gaming room (RAM deletions, configuration changes, progressive parameter setting), requiring technical reports and / or any other relevant reports for analysis.
  • Develop analysis methods and tools based on the information available from different sources, aimed at maximising the performance of the machines, optimising the operations carried out in the gaming room, or improving the global management of the Area and its Departments.
  • Perform planning, control and monitoring of future tasks, such as movements and/or incorporation of machines, progressive jackpots, gaming systems, etc.
  • Perform statistical analysis of customers based on their gaming preferences.
  • Provide support to the Marketing area to set up promotional campaigns.
  • To permanently attend to the necessary relations with the other areas of the company, with internal and external suppliers and with the Control Organisms.

The aim of this section will be to analyse with the reader the basic fundamentals necessary to carry out these tasks, in order to achieve a thorough understanding and interpretation of the main parameters that intervene today in the development of the activities of the areas related to the operation of slot machines. In particular, we will address the basic and initial aspects of the analysis of slot machine performance and profitability, the parameters and variables that such analysis involves, as well as the criteria to be taken into account when facing the complex process of permanent optimisation of the offer of products and services in which the professionals involved in the industry are immersed.

Throughout this column we will try to develop in a practical and didactic way the basic notions regarding the way in which casino games in general, and slot machines in particular, generate profits for the casino, as well as the different parameters and variables that have the greatest impact on them. During the following installments we will analyse in depth the PAR sheet and try to determine from it the different components of product analysis, as well as the different factors that influence the success of a game.

The basic slot problems

We will explore, together with the reader, the fundamentals of progressive systems and the problems related to their accounting, analysing the different types and configurations, their main characteristics and the effects on the increase of the gaming volume of the machines.

The basic elements of analysis and interpretation of slot machine performance and profitability data will also be examined, looking at the associated calculations and reporting, followed by some notions of game mix selection, configuration and floor design, as an introduction to the complex decision making process involved in running an efficient gaming floor today.

I do not want to end this introduction without alerting the reader that most of the contents that we are going to develop along this section during the next deliveries are not original, but are part of a compilation of several courses, seminars, articles and lectures that the author has done along his twelve years of experience in the industry, combined with a great number of practical experiences, mistakes and successes, arising from the daily management in the Slot Area of one of the biggest and most prestigious casinos in the region.