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Sudhir Kale, CEO of GamePlan Consultants and a marketing / loyalty expert cautions against betting too big on robotics, machines and artificial intelligence in our hospitality driven industry.

“It is only a matter of time before we see robotic concierges (as seen in some hotels), robot dealers, and even AI-driven robot hosts,” said Kale.

“But as we get increasingly sucked into the promises of big data, sentiment analysis, facial recognition systems, machine learning, and AI, we are facing a real paradox. Technology allows us to understand the customer like never before, but these insights are seldom used to relate to customers in human-to-human interaction.”

Sudhir is an expert in casino loyalty programs. He said that these new technologies, which may save costs and improve efficiencies, lack a critical element for our industry: the “human touch”.

“Automated loyalty kiosks are depriving casinos of that human touch that alone makes guests feel welcome and keeps them coming back.”

In land-based gaming, advancements have been made pairing artificial intelligence with facial recognition systems - not only to identify and tag patrons - but to understand their risk profiles, and categorize patrons based on their propensity to ‘bet big’.

This has raised concerns of whether Artificial Intelligence can exacerbate problem gambling.

Last year, Macau’s gaming regulator, the Gaming Inspection and Coordination Bureau (DICJ) banned the use of artificial intelligence tools that could help casino operators track gamblers more likely to bet big.

According to a Bloomberg report, this new technology uses algorithms to process the way a customer behaves at a gaming table to determine their appetite for risk. The higher the risk appetite, the more a gambler stands to lose - which means profit for the casino.

The regulator has taken the side of caution, barring any casinos in its jurisdiction from installing digital surveillance equipment equipped with cameras or facial recognition systems - unless previously approved by the DICJ.

According to experts, while it may seem that our gaming industry is already powered by Artificial Intelligence, most examples are in fact, simply iterations of Machine Learning technology - which has been around for nearly sixty years already.

“With Artificial Intelligence being such a buzzword these days, there will be some who will take certain liberties calling their technology ‘intelligent’ when it is not,” explained Earle Hall, technology expert, futurist and the chief executive of AXESNetwork.

Machine learning is one where a system acquires knowledge or skill through experience. It relies on large data sets and identifies common patterns - which allow it to do a very narrow task, better, explained Hall.

While it is a subset of AI, the system is merely trial and error where the learning is based on narrowing the false, untrue or error results.

We can see a similar use of this technology in online gaming, such as EveryMatrix’s CasinoEngine, which uses machine learning to power its recommendation engines - putting games the player is most likely to enjoy at the top of its list.

In the land-based casino industry, machine learning has been used to drive engagement and loyalty, with sophisticated CRM systems deciding the best and most appropriate offers to give to customers at any given time to maximize their stay.

Machine learning technology is not new, but there is constant work being done to improve models, accuracy of predictions, and deliver better decision making.

That being said, in the end, this form of ‘intelligence’ relies on the set of predicted outcomes - which is less ‘intelligent’ and more ‘learning’ - as opposed to artificial intelligence, says Hall.

Artificial intelligence, on the other hand, describes machines or computers that ‘mimic’ the natural intelligence displayed by humans. It can adapt to new situations and problem solve in ways that machine learning falls short.

Silicon Valley entrepreneur George Yang, CEO of AI Pros, has been developing an AI-powered chatbot - aimed at replacing costly call-center employees.

Due to the sheer complexity of the spoken language - which can differ based on culture, gender, past-experiences, emotion, and a limitless amount of factors, it would not be possible to utilize a machine learning system for this task.

Yang’s work revolves around the use of artificial intelligence and natural language processing. The chat bot is aimed at mimicking a customer service agent, in industries such as hospitality, banking, finance, medical and gaming. It can understand unique jokes, respond to sarcasm, and inflections and tones in real time.

Despite this, it will take time before Artificial Intelligence expands out to every corner of our industry. How it will be utilized, and how it will be regulated will be key in determining how it will flourish.

Facial recognition is not new to the casino sector, but it has traditionally been restricted to security teams, primarily as an aid to keeping barred individuals off a property.

But the technology has developed to a point where many now see it as central to growth plans over the coming years - with the potential to overhaul CRM, VIP and marketing departments.

At December’s G2E conference in Manila, Scientific Games’ sales director for Asia Clinton Long described the technology as a “game changer for the industry,’’ adding that operators so far are only “scratching at the surface”.

He said that the technology could be used to significantly enhance the gaming experience on the casino floor, including everything from identifying players as they move throughout a property to ascertaining their likes and dislikes via emotion recognition.

Roger Lwin, vice president of gaming operations for City of Dreams Manila was equally optimistic.

“Facial recognition technology has tremendous opportunities for us. Before the VIP customer comes in, the host could already have their favorite drink on hand. For operators, anything that improves our profitability, efficiency and customer experience - we’re in for that,” he said.

Such applications are already in use. AGB understands that several casino operators in Asia are operating facial recognition technology that alerts managers when VIPs enter a property.

And it was reported last year that Wynn Macau, Galaxy Entertainment Group and Melco Resorts & Entertainment were all in discussions with suppliers to roll out the technology.

“[Most people’s first thought with facial recognition is]: ‘Great, I would like security to get a text message when a bad guy shows up. I would also like my hosts to know when a VIP player enters the property,’” Dave McCormick, director of marketing at eConnect, told AGB.

Las Vegas-headquartered eConnect operates offices in Asia, with a focus on delivering facial recognition technology that can serve up actionable insights. The company works with major operators in Macau, Singapore, Cambodia and the Philippines.

“To fully appreciate the power of facial recognition, you must first understand how accurate it has become. Prior to neural networks, and as far back as 2002, systems attempted to measure the distance between the eyes and ears,” said McCormick.

“This may have worked with a database of around 1,000 people, but failed miserably when scaled or when the subject was not looking directly at the camera. With the use of neural networks, systems are trained with billions of faces. The accuracy is approaching that of a fingerprint. Glasses, hats and various poses do not prevent successful recognition,” he added.

These enhanced capabilities open up entirely new fields of application for the technology, particularly across VIP, CRM and broader marketing, and even in the tracking of wagers on the table.

“When recognition occurs, the unique attributes of the faces are rendered to a small piece of vector data. This is important to know, because this data can be stored for years and years. Whether carded or not, it is quite easy to begin creating a profile for each person.

“How often are they visiting? What is their duration of visit? Are their visits trending upwards or down? How many people are currently in the casino? What percentage of the guests are first time visitors?” said McCormick.

The tracking and storage of such data does, however, raise regulatory and consumer concerns, particularly if transmitted internationally.

McCormick concedes that facial recognition, as with much new technology, is pushing at the limits of personal privacy. But he said that the technology has already progressed to a stage to which it would be tough to put the genie back in the bottle.

Macau will likely be at the forefront; the Chinese government is already operating a large scale facial recognition program, while the country’s banking sector is also embracing the technology. However, the Macau government so far has said such systems can only be used for security.

Still, there are also applications for facial recognition that could keep regulators onside.

“One of our initial regulatory uses for facial recognition, was to group and total anonymous kiosk transactions to the face,” said McCormick. “If a person were to visit multiple kiosks and cash out more than $10,000 within 24 hours, we alert surveillance allowing them to create the proper AML / FinCen reports.”

Assuming a balance can be struck to allay the concerns of both regulators and customers, it is likely that facial recognition will become a key tool for operations teams across a casino.

“I think we’ll start to see more and more departments, specifically marketing, take advantage of the technology,” said McCormick. “I imagine kiosks will create custom offers and prizes for the individual. Casino operators will have a better understanding of their uncarded players, and perhaps the players card will be a thing of the past.”

This is not a trend confined to Macau, though.

A 2019 report by Mordor Intelligence found that gaining new customers can be 25 percent more expensive than retaining existing ones for companies in the Asia-Pacific region.

The report also outlined how the loyalty management market in the region will expand by a compound annual growth rate of 25.1 percent to reach $2.29 billion over the five years through to 2024, illustrating an appetite for consumers to enjoy stable and sustainable relationships with brands and services.

“Operators, especially in Macau, are shifting their player loyalty marketing efforts from a VIP and junket priority to that of a premium or mass market,” Everi’s executive vice-president of financial technology and loyalty, Darren Simmons, says.

“Attention is now being placed heavily on how to reward based upon the player’s loyalty. In the past, it was easy to identify VIPs and to focus on these customers with direct interaction. With the emphasis now on the mass market, additional consideration is being placed on getting a player’s card in their hands. Marketing and loyalty are becoming more important for operators.”

On a basic level, mobile is seen as a crucial tool for encouraging loyalty through personalised communications.

“We are beginning to see more penetration of mobile technology among mass-market players,” Simmons adds. “Casino guests want and need to receive information via mobile applications on the property’s events, competitions and offers. A mobile loyalty program enables operators to interact and engage with their guests regardless of their location.”

According to Nelson Cheung, IGT’s System Sales Manager, Asia, such programs are improving efficiencies in casinos, as well as boosting revenues.

“From a loyalty and bonusing perspective, operators want to offer bonuses to players during a play session and market directly to the player’s mobile phone while on the casino floor,” Cheung says. “Venues want to be able to identify hot play areas and new players in real time so they can proactively and quickly enrol uncarded players while catering to hosted players, which are features that our Mobile Host solution provides.”

The mobile focus also tallies with the increasing shift towards cashless payments in Asia, with Cheung highlighting IGT’s Resort Wallet and Cardless Connect solutions.

“A notable trend in Asia markets is that consumers are accustomed to using their mobile phones for both loyalty and currency transactions,” Cheung adds.

“Cardless Connect enables a player’s smartphone to become a loyalty card and, in conjunction with this, Resort Wallet transforms a smartphone into a secure digital wallet. IGT’s Intelligent Offer allows operators to factor real-time player behaviours and events in the evaluation and award of bonuses.”

The IGT ADVANTAGE Intelligent Bonusing products, which have been especially popular in the Philippines, offer non-cashable rewards. Random Riches gives operators the ability to deliver random or fixed amounts of ‘Xtra Credit’ non-cashable rewards when the player achieves points levels set by the operator, while Intelligent Bonusing deployments in the Philippines also include Lucky Coin, a pool-based jackpot; Lucky Draw, which creates exciting floor-wide bonuses; and Lucky Time, a time-based mystery jackpot.

Non-gaming bonusing as a broader offering is important, especially for the reputation of the operator.

Some research suggests loyalty programs can exacerbate problem gambling. According to a 2016 study, 47.1 percent of punters who were part of gambling loyalty programs were either moderate-risk or problem gamblers.

Everi’s loyalty platform offers selfservice solutions through enrolment and promotional kiosks – which boast highresolution monitors, integrated touch screens, and multiple interfaces – alongside a loyalty mobile application. The enrolment solution, which features facial recognition and biometric authentication, offers instant bonuses when players sign up, providing “complimentary services that can increase overall satisfaction and generate loyalty” like shopping, entertainment and dining.

“We believe this technology enhances the guest experience while assisting with security efforts on the casino floor,” Simmons said.

Everi’s promotional kiosk allows players to view their status progress and available rewards, as well as redeem rewards, with a multi-language platform available in Asia. Meanwhile the loyalty mobile app can be tailored to enable guests to engage and interact with the casino on or off property.

Everi is anticipating significant growth in the Philippines, South Korea and Singapore, and “especially Macau, where the focus is on mass-market players… and promotional kiosks interact with the mobile marketing efforts of the casinos.”

Transact Technologies is another supplier seeing strong demand for loyalty based products across the region.

“Player loyalty continues to be a key focus for operators, and they are looking into the technologies encompassing this. Fortunately for TransAct, we have the perfect tool in Epicentral which can increase player loyalty and as a result, deliver positive results for operators,” it says.

Everi’s Simmons adds: “We believe operators will try to advance their marketing efforts and maintain their competitive advantage both in their local market and throughout Asia by borrowing this mass-market approach to linking loyalty to rewards.”

Whether it is via mobile or via selfservice kiosks, targeting customers with a personalised approach can be powerful.

For example, IGT’s Intelligent Offer allows beacons to transmit a specific offer to a player within a designated range, enabling the operator to deliver relevant promotions in real time.

However, in general, Simmons believes that casinos in Asia are “still playing catchup with the loyalty aspect of marketing and even more so with the technology associated with those marketing efforts”.

He adds: “Technology that unifies all aspects of the player card attributes is required, almost modelling how loyalty and marketing is executed in markets like Las Vegas. Attracting mass-market players by applying Las Vegas experiences can be an effective method to sustain a competitive edge for operators.”

In 2020 however, artificial intelligence (AI) is very much talked about with the perspective of how it can improve the social responsibility and the responsible gambling (RG) credentials of the industry. And with good reason. Reducing rates of problem gambling and demonstrating that its best business practices adhere to the highest levels of player protection and social responsibility are the best and, in truth, only way operators will avoid fines or further regulatory clampdowns.

That is why the matter is so topical amid a regulatory atmosphere that is reaching boiling point when it’s combined with mainstream media coverage that is so strongly anti-gambling.

That is the case for European markets like the UK, where it is near certain that the Gambling Act review that will be taking place in the coming months will bring with it further prescriptive regulations; along with other EU countries like Spain, Italy or Sweden, which have been harsh on operators recently.

The industry to a large extent has acknowledged that it has come up short on its RG failings over the past decade and more, which is why it is looking at technologies like AI and facial recognition technology (FRT) to help it recognise, classify and manage problem and at-risk gamblers.

For all the talk of brave new technological worlds however, there are pitfalls to AI and FRT. In addition, much of the use of AI so far has centred around predictive technology and how it can tailor and offer yet more markets and gaming content to players, rather than how it can help operators fight problem gambling, money laundering, improve due diligence or ensure provenance of funds. Needless to say, that isn’t the ringing endorsement for RG that the industry is so keen to promote.

Sally Gainsbury, Associate Professor and co-director of the Gambling Treatment & Research Clinic at Australia’s Sydney University says that artificial intelligence, like all gambling technology, needs to have its risks understood from a responsible gambling perspective.

“Technology is transforming how people gamble, bringing advantages to operators and customers in terms of products. However, it is essential to understand the new risks for customers based on these changes and how to use technology to offset these and ensure that any harm coming from gambling is minimized.”

Gainsbury’s department at the University of Sydney has been using machine learning to identify problem gambling amongst online wagering customers in Australia. “If we can identify clusters of players and identify risk factors for problematic gambling we may be able to detect players who are at risk of experiencing harm before these become serious,” she explains.

Hervé Roussel, founder of Ho Chi Minh City-based start-up Quod AI, says: “It is possible to identify and classify gamblers based on amounts gambled, time and location of the activity, type of gambling: whether it is sports betting and if players bet on the same team, in the same type of competition (i.e. FA cup or league matches), what type of bets are placed: pre-match, in play or half-time, Asian Handicap, 1X2 and so on.

“The same applies to casino: slots vs. table games and it can be classified according to how much customers bet and whether they are displaying aggressive/passive betting patterns or loose/tight betting patterns, these criteria can also be applied to poker.”

are displaying aggressive/passive betting patterns or loose/tight betting patterns, these criteria can also be applied to poker.”

Gainsbury adds: “This would enable various levels of interventions depending on the risk level identified – for example ranging from a personal email suggesting use of deposit limits or a time out, to a phone call to check in and assess other potential risks such as gambling beyond affordable levels.”

The pitfalls centre around the fact that AI removes much of the human element and judgement capabilities that can be so important in assessing cases, in real time or after an event. As Joe Pisano, co-founder and CEO of AI responsible gaming start up IMAGINE, says: “AI, like any technology, is a double-edged sword. It has the ability to solve problems and increase efficiencies - but at the same time, it could take away the very element that makes our industry human.”

Quod AI’s Roussel adds: “AI models have been built to approve or reject players based on demographic profiles, but this can also lead to issues like not explaining how or why certain decisions are reached, whether there is any element of human bias in formatting the AI and of course the quality of data has to be there.”

In other words, for all the possibilities AI offers to the gambling sector, there is much to be said for the human element. Despite all its imperfections it will surely continue to play a key role in determining how much of an impact AI has on the gambling sector - now and in future years.