Casino and Gaming Mergers & Acquisitions

Small Footprint Casino

Company: Small Footprint Casino

Casino was struggling with revenue generation from their Slot and Video Gaming machines. They recently went through a renovation and had organized their machines into 3 clustered areas within the main casino floor. They noticed their revenue significantly drop (12%) in the following 3 months of production. Their management team had full access to detailed data on a machine basis, including historical performance. They were looking to identify where they were seeing opportunity to improve floor layout plans or simple placement of machines.

PAG Solution:
PAG worked with the client to review the existing & historical data they had available. We then spent 2 days onsite with several floor supervisors to walk through the current layout and review the previous layout.

Stage 1consisted of PAG evaluating the individual machine production and profitability, including constructing a generic floor layout with a heat map of the machine production. We then compared each machine’s recent performance to their historical trends.

Stage 2 included observing traffic flow of the customers during high traffic times on the Casino Floor. We also evaluated traffic flow during the slower times. We then created Business Intelligence (BI) reporting to show performance by machine by different casino floor traffic times.

Stage 3 allowed PAG to work with the Casino Management team to evaluate shifts in performance pre and post renovation and movement of machines. In addition, we were able to show them detailed statistics on their individual machine profitability and optimal location. Lastly, we were able to show the unreasonable lack of traffic flow that occurred in their clustering of machines, which caused many to go untouched.

Final recommendations included maintaining current renovation major changes while updating machine placement according to machine learning algorithms we created from the historical data (which occurred under 2 different floor plans and product placements). This allowed us to optimize customer flow from areas such as restrooms, restaurants, Poker Room, shops and other attractions. Here is a revised example of the heat map created, with removal of identifying marks, and slight movement of pieces to anonymize the Client:

Client Benefits:

  1. The new design and machine placement realized an improvement of 16.2% in revenue generation, after removing seasonality (improvement was 19.8%, which included seasonality over the summer months).
  2. Average time per session improved by 5%, while time away from machine improved by 7.1%. Data for this was based on individual customer’s who had their player cards inserted into machines only.
  3. PAG worked with the client to build ongoing automated reporting through our custom portals to continually track performance on a set of 10 metrics we established to assist the casino in optimizing profitability long-term.
  4. PAG has been engaged by the Casino for 2 subsequent projects since the implementation of the changes
Casino and Gaming Casino Management Platform Optimization

New York Based Racino

Company: New York Based Racino

Casino was looking to enhance their marketing efforts within their existing customer base and expand their prospecting for new business.They did not have a convenient way to access the data, as it was stored in their production servers for the analytics portion of the exercise. The Casino manually created reporting and QA through manual entry into spreadsheets. For new business prospecting, they were mass marketing to a very large untargeted population, resulting in under 10 bps (0.10%) of response rate.

PAG Solution:
PAG first worked with them to develop a true prospecting marketing campaign utilizing Geo-Fencing, by evaluating consumer behaviors based on location tracking of their devices. In addition, search engine queries. Finally, targeting individuals that met pre-determined criteria to generate digital marketing campaigns to generate foot traffic into the Casino.

Stage 2 included implementation of our GOBLIN solution. This allowed us to organize their data outside of production, allowing them to query, report and analyze as needed in an efficient and concise manner. We set them up with the Business Intelligence (BI) tools for dynamic reporting.
2 months after completion of the project, the Casino had seen such an internal lift in understanding their data & analytics, they engaged us to build out a custom portal for report organization, distribution and governance.

Client Benefits:

  1. PAG was able to quickly deliver a large lift in foot traffic within the Casino with the digital marketing strategy expansion
  2. PAG ‘s solution assisted in an increase of 18% in foot traffic Quarter over Quarter, which included an increase of 22% in average customer spend
  3. As opposed to building the solution and staffing to manage the final product, the Casino was able to save 31% to their budget, with no incremental headcount, by implementing GOBLIN and having PAG manage the process going forward.
  4. The Casino has seen a steady lift through seasonality, which continues through the 2nd Quarter of 2019.
Casino and Gaming Reporting & Analytics

Medium Scale Las Vegas-based Casino

Company: Medium Scale Las Vegas-based Casino

Company was looking to accomplish several initiatives, including organizing their data across multiple sources into one repository for analytics and reporting, developing live reports as the data updates for multiple distribution lists, driving analytics for Marketing responses, channel optimization and casino efficiencies. Major problem was data was residing on 4 separate platforms in 2 separate locations. In addition, linking data between sources was an issue.

PAG Solution:
PAG was able to aggregate all four data sources into one repository. The systems remain intact, with data extracts populating their new EDP solution (GOBLIN). PAG then mapped each of the four data sources to allow simultaneous use of the data to generate automated & manual reporting, business analytics and marketing strategies. PAG built a custom Portal for the business, which allows for automatic distribution of reports and analysis, which is controlled by user logins. This allows for specific reporting sets to be directed to specific individuals. Implementation of the EDP also included the Business Intelligence (BI) tools for internal resources to create analytics and reports. Finally, after implementing the final solution, Company engaged PAG to complete the development of their marketing channel optimization strategies and enhanced their existing response models.

Client Benefits: (3-4 and provide QUANTIFIABLE benefits)

  1. PAG was able to identify, and implement, key areas of automation for the company
  2. PAG provided a robust solution that was designed to allow future client integration with little technological knowledge
  3. PAG’s solution created a 67% decrease in manual efforts while adding much needed QA for the data and reporting needs
  4. PAG’s solution came in significantly under budget and will meet the company’s needs for the coming years
  5. The incremental marketing analytics work helped reduce marketing costs by 26%, while increasing responses by 13%.
Banking Services

Large Credit Card Issuer – US Co-Brand

Company: Large Credit Card Issuer – US Co-Brand

Company launched a card product that was experiencing higher than expected fraud losses.They had a team who built fraud strategies using past experience. Due to several unique product features and lack of data to build strategies, there were several gaps. They were looking for support to evaluate their fraud authorizations and new account strategies against industry standards and best in class fraud controls.

PAG Solution:
PAG conducted a deep dive into the bank’s existing fraud data, reporting, authorization and fraud queuing systems, and detailed rules.Using deep industry experience and data and reporting available, PAG recommended rule changesto address emerging fraud trends and system enhancements to support next level fraud avoidance. In addition, PAG completed a deep dive of payment controls, recommended vendors and additional rules to reduce payment returns and first party fraud.

Client Benefits:
The changes PAG recommended drove:

  1. $1.2MM+ in annual application fraud avoidance.
  2. $13.2MM in annual fraud loss avoidance through incremental ring and bust out transaction rules (decline 35% $ fraud loss rate).
  3. Incremental $46MM annually in low risk spend (approve 1.5% fraud $ loss rate)
  4. Net impact $14MM fraud loss avoidance, $8MM incremental spend annually
Banking Services Underwriting Strategies

Top 10 Credit Card Issuer – US Co-Brand & Branded

Company: Top 10 Credit Card Issuer – US Co-Brand & Branded

Company has greater than 30 co-brand partner portfolios and several branded portfolios. Over the last 6 years, their underwriting strategies were using an older version of FICO and a custom score built in 2013. They have a very light staff of risk management analysts to revise a custom update to their portfolios. They were looking for support to rebuild their custom score to the next generation and revamp several of the larger portfolio underwriting strategies.

PAG Solution:
PAG was engaged in a 2-stage approach, which included developing a new custom score for underwriting and then utilizing that score, once approved, to develop custom underwriting strategies for several of their larger co-brand portfolios and 2 of the branded portfolios. PAG utilized their internal capabilities and systems to work with the bank to gather the needed data requirements from both internal bank data and external data were applicable. PAG developed a new custom underwriting score with 6 unique segments, which overall increased the KS from 34 to 48 for the overall scorecard when rolled up. From there, the score was quickly approved by the client and coding into the system began immediately. PAG then developed the underwriting strategies utilizing the new custom score and the newest version of FICO.

Client Benefits:

  1. PAG was able to not only deliver a new custom underwriting score, but also worked with the Decision Science team to upgrade their internal model documentation process, and provided them a new model governance template for ongoing model management (all OCC & FDIC aligned best practices)
  2. PAG was to improve the approval rate across the portfolios that were managed by PAG an average 22%
  3. Targeted loss rates were decreased by 6% overall, while overall profitability increased by an average of 26% across all portfolios touched.
  4. PAG’s solution came in slightly over budget, due to the mid-project request for model governance and procedures, however, came in below the overall expectations of the client
Data Warehousing

Beating Back the Beast: Cybersecurity in the Financial World

You read all the IT reports, you follow their recommendations, and you pay attention when they inform you of risks and problems. Many of your associates or those you know do the same. Yet somehow, you still hear about breaches in businesses everywhere, including your personal network.

The reality of the current climate is that it’s not IF but WHEN with data breaches. Data breaches are an evolving, everlasting problem for all businesses. Targets for data breaches can extend from the “mom and pop” corner stores to every Fortune 500 company. While you are growing your business, hackers are growing theirs. Equifax or not, your data has a big price tag.

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