Question 1

What is Theoretical Player Value (Theo)?

Accepted Answer

It's the amount a casino can expect to win from a player over a period of time. It's a statistical calculation based on their play style (average bet, time played) and the game's inherent math (house edge), not the actual amount they win or lose in a single session.

Question 2

What is 'House Edge'?

Accepted Answer

The house edge is the mathematical advantage the casino has in any given game, expressed as a percentage of the player's bet. For example, a house edge of 1.41% on Craps means the casino expects to keep about $1.41 for every $100 wagered over the long run.

Question 3

What are 'Decisions per Hour'?

Accepted Answer

This is the average number of bets or hands a player completes in an hour. This varies significantly by game and player speed. For example, a fast-paced game like Blackjack might have 70-80 decisions per hour, while a slower game like Baccarat might only have 40.

Question 4

How is this value used for 'comps'?

Accepted Answer

Casinos typically reinvest a portion of a player's theoretical value back to the player in the form of comps (free rooms, food, drinks, show tickets). A common industry standard is to offer between 30% and 40% of the player's Theo. So, a player with a theoretical value of $200 might be eligible for $60-$80 in comps.

Question 5

Is Annual Value the same as Lifetime Value (LTV)?

Accepted Answer

Not exactly. Annual Value, as calculated here, is a simple projection of a player's theoretical value over one year based on their visit frequency. True Lifetime Value (LTV) is a more complex metric that forecasts a player's total value to the casino over the entire course of their relationship, factoring in churn rate and changes in play over time.

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Understanding Player Value

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