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Gambling traveling is a big business: Here’s how casinos make millions from tourists

These days, Las Vegas is back to its glorious days albeit with one challenge: it’s not the biggest destination for gamblers anymore. Macau, the Asian island governed by China, has since assumed that position.

During the last recession, Las Vegas suffered hard. Home prices went down by half in some locations. Thousands of people lost jobs and gambling tourism, the economic backbone of Clark County, dropped by a landslide.

These days, Las Vegas is back to its glorious days albeit with one challenge: it’s not the biggest destination for gamblers anymore. Macau, the Asian island governed by China, has since assumed that position. 

Atlantic City, Atlanta, London, Monte Carlo, and South America are also solidifying themselves as ideal cities for gambling tourists. In spite of the growing competitions, casinos have ingenious ideas that make tourists drain their wallets. Below are some of them.

The house always wins 
When most people visit Las Vegas, they are usually ready to go back home with less money than they came with.  Even people hoping to win more money than they play with understand the risks of gaming. You either win or lose. 

Casinos go the extra mile of securing their long-term profits by placing an advantage to the house in each game. That way, casinos win slightly more often than players over time. Sometimes the house edge could be small, like a 1% edge or as huge as 15%.

Given that the average gambling tourists spend $1000 per visit, 10,000 visitors per month quickly converts into $10 million wagered. With an average house edge of 10% across all games, a casino could be making $1 million every month. Keep in mind up to 40 million people visit Vegas every year, some who wager millions of dollars.

Resort services
Twenty years ago, Las Vegas used to make about 90% of its revenues from gambling alone. That is no longer the case, not especially after online gambling became a thing. A significant fraction of gamblers that used to flock Clark County to gamble now do it at the comfort of their homes.

States like New Jersey, Delaware, Colorado and Rhode Island support online gambling. NJ online gambling, for example, is now a fully fledged industry with state-licensed gambling sites offering their services to state residents and throughout the country. 

When people visit brick and mortar casinos, therefore, they don’t always visit to spin reels on slots machines. Young tourists mostly visit gambling cities to experience exotic night clubs, engage in luxury shopping and visit all the majestic places in the city

Of course, Vegas and similar cities are ever ready to adapt to changing demands. Wynn Las Vegas Casino, which used to make more than 50% of its revenues on the floor, now relies on casino gaming for 23% of its profits.

The casino's main revenue source is its restaurants, commanding 38.7% of all accrued income. Wynn also makes 26.8% of profits from hotel rooms and 11.5% from other services. Macau casinos are the opposite of Las Vegas though, earning most of their profits from direct gambling.

Venetian Macao, one of the biggest casinos in Macau, only made 2.5% of its revenues from hotel room services in 2017 and 6.8% from food and drinks. Wynn Macau doesn’t even offer food and beverages and earn 87.1% of its revenues on the floor.

Free drinks and bonuses
Woe unto you if you’ve always thought casinos give people free drinks for the fun of it. For starters, free drinks are paid for by players. With all the money people leave to the house as losses, establishments make more than enough money to afford drinks for players.

Make no mistake also—most casinos only give your drinks when they see you playing. If you’re idle or staring as others play, waiters and waitresses will tend to skip you. The goal of giving people free drinks is to make them play more. And no one loses more money than a drunken gambler.

Vegas and Macau bonuses also come with strict terms. You must wager at least $100 or more to earn rewards. You get more bonuses the more you play. This is also true for online casinos. But with the latter, you only need to spend as little as $10 to earn bonuses.

Las Vegas, in particular, has a loyalty system that rewards the highest spenders. In addition to attaining minimum bets, casinos reward players based on how long they gamble. Most people gamble four hours straight to qualify for decent gifts. Joining VIP clubs also attract real money prizes and gifts like cars but you must be willing to spend thousands of dollars.

Psychological marketing
Everything you’ve heard about casinos using tricks to make you spend more money is true. From missing clocks to using chips instead of cash, over celebrating small wins and the drinks we just talked about are all forms of psychological marketing.

With no clocks on the walls and games hooking you so much that you forget to check the time, it's easy to gamble all night in a good casino. When you are also getting free drinks and other perks, you almost can’t keep up with time. 

Casinos also make it harder to understand the progression of time with unique lighting and interior designing. You can’t differentiate between day and night unless you check your watch. Some shopping malls also use the same trick.

When you win, even if it’s just $500, some casinos will make everyone know about it by flashing lights and sounding celebratory soundtracks. You also receive your money in cash or a check delivered by house managers as everyone else watches. 

If you’ve also been to a brick and mortar casino, you also know that games are placed in almost every corner. You can hardly walk a few minutes before spotting a slot machine or a gaming table. Most people get tempted to play, which the house’s plan is all along.

In conclusion
Gambling tourism is big business these days, and it's not just Las Vegas that takes advantage of it. Macau has already surpassed sin city in revenues earned every year. Nonetheless, brick and mortar casinos know how to make gambling tourists spend money. The best casinos make more than a billion dollars each year from revenues coming from other services besides the floor.

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