How Casinos Make Money

So many innocents head to the casino every year, thinking all it will take is a few spins to win big. But the reality is much darker, as casinos always do, and always will make a profit, but how?

Casinos ensure they make a profit by programming house edge into their games. While the house edge can vary from casino to casino, there are professionals who help casinos ensure they will always make a profit, no matter what. Read on to learn more about how casinos calculate game margins.

1. Game Design

Trust us when we say that any game that isn’t returning a profit to the casino will quickly disappear from the casino floor. Not only that, but games that don’t offer a guaranteed return to casinos won’t end up there in the first place.

For example, just look at a roulette wheel. While half of the slots are black and half are red, there is still one (or two, depending on the type of roulette you are playing) that is a different color and an automatic loss, no matter who bets. These spaces, which are often green in color, act as a failsafe for the casino, ensuring there will always be some way for them to take a win for themselves.

This process is even easier with slot machines, as these machines can simply be programmed to return a certain amount of money to players. This is why they are the most prolific games on the casino floor.

2. Hidden “Fees” Like Rake

For the games that can’t automatically be programmed or aren’t built to allow the casino to win from time to time, fees are often folded into the game, most of them eventually becoming synonymous with gameplay. A good example of this is rake when playing poker.

Rake is a small fee the dealer removes from each pot. Often a percentage of the total pot, this money is kept by the casino as a way for players to “pay” to play. This is necessary because poker is a skill game, where players play and lose to one another, meaning there is no other way for the casino to take a cut without rake.

Of course, both of these aspects—game design and taking in rake—make online gambling even more attractive for casino operators. While it isn’t as fun for players, the casino can easily ensure it collects a share of player money—often with the click of a button.

3. Other Purchases

One of the main ways that brick-and-mortar casinos collect money from players is through other purchases.  While drinks still remain free for players in many casinos, a lot of the other amenities aren’t. Examples include the hotel rooms, restaurants, and tableside services like massages. In many of these cases, the casino receives an automatic portion of the income from these activities.

We know what you are thinking—well, what about comps? What about them? While they are a free benefit offered to some players, they are also designed with care—meaning you will never receive a comp you didn’t gamble more than the cost of. Not only that, but companies like casinos and restaurants often reserve a small portion of their budget for marketing, and your “comp” may just come out of this budget.

Still, in the end, that doesn’t matter. The only reason you won a free night in the hotel is because you gambled far more than the cost of a single room, we promise.

4. Nobody Games Like Casinos

There are literally professionals out there who ensure that a casino will net enough to meet its bottom line. They will analyze the market, machines, and more, just so they can tell a casino how to program their games, the mix to have of each, and when to hand out comps. You may be sitting behind your computer screen laughing, but it’s true—casino owners are the biggest gamers of them all.

While starting a casino requires a lot of upfront capital, especially when it comes to governmental things like licensing, in general, running a casino is very profitable. That is why there are so many around the world, and why they have so many nice buildings, lights, and staff.

It’s not just that; there are game designers out there who know exactly how often you need to win to keep playing. They know what lights and colors entice you, and how they can ensure that you won’t walk away after “just one more spin.” There is a whole industry built around gambling, and you better believe some people study their whole lives just to ensure the casino owners make money.

Casino owners are actually the biggest players out there, and they know just how to play you.

So How Many People Actually Win?

No matter what you may think, almost everyone ends up spending more money at the casino than they take home. While we aren’t sure if this number includes more than just gaming (as in restaurants, shopping, and entertainment), statistically, only 13.5% of people ever end up winning in a casino. Meaning you are more likely to lose.

It is important to note that the house edge does vary from casino to casino, and this is also set by professionals, usually statisticians who help casinos estimate how much they need to collect from each player to keep people coming back and pay their bills. So while this doesn’t mean playing at certain casinos makes you more likely to win, there are casinos out there where you will lose less as you play, and they are usually smaller, local casinos that need to keep you there longer.

Overall, there is no real way to win against a casino, but that doesn’t mean you can’t enjoy the game and give it your best go. And who knows, you might just be part of the 13.5%!