Think-ThroughThink-Through - A place to think

Smart casinos can gather a lot of data about their customers, especially their recurring ones. Lots of people love to gamble, but few of them end up positive. The majority of them ends up with less in their pockets at the end of the experience than they had at the beginning. Of course the monetary component is important, but it is not the only one.

Smart casinos have long figured out that the entertainment and social component are as or more important, and have added all sorts of entertainments. Of course there is a price you are willing to pay for the experience, and if casinos knew that price, then they could increase their profits considerably, and have happier customer. The way you pay for the experience if, of course, through your gambling losses.

Almost everybody entering a casino have a number in his head, and that number is the maximum loss for the day. You lose less, you had a positive experience, and are likely to come back. You lose more, you had a negative experience, and are less likely to come back. The problem is, the casino doesn’t know your number. It turns out your number is pretty similar to many other people number, and if the casino could figure out that segment number, it could intervene and ‘save your day’ before it is too late.

Here comes the gambler card. It works like a normal credit card, but gives you access to casino privileges, and ease of use. You fill in your personal details (especially demographic), and off you go with it, to the betting tables. The card registers pretty much everything: where you played, how much you lost, how much you won. But equally importantly, the cards also allows the casino to figure out you ‘pain point’, which is that magic number below which you still claim the experience was good, and above which you are definitely going to say you had a very bad day, and you promise not to come back.

With your personal and demographic data you have given the casino the chance to figure out exactly that number. You might be middle thirties, come from neighbour X, male, employed at a big company, earning Y. That’s enough to put you in a well-defined segment, and assign you a pain point. Let’s say that pain point is £500.

As time goes by, and you accumulate your losses, you might get worryingly close to that pain point. And when you are too close, a casino attendant comes to the rescue, offering you some special treatment that you can’t refuse. You are down £400, and somebody shows up to offer you a free ticket for a VIP exhibition just about to start, if you leave the tables immediately. Or that fancy dinner with your spouse, but the offers ends in 5 minutes.

Of course you take it. It has been such a poor day, better get the freebie, enjoy some good time, and call it a day. And leave happily after having lost £400, ready to come back, to lose another £400.

This is happening today, probably unknowingly to you.

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an internet minute

an internet minute

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I was shocked when i saw the table below. For all that US-effiency talking, comes out the two most productive metropolitan areas in the world are… guess where? in Europe. And one of them is not even in northern Europe, but in southern Europe. For all that Southern Europe laziness talks, comes out that Milan is more productive than San Francisco, New York, London, Munich or Chicago. Ever heard chats about the lazy French? Well, they are not far behind San Francisco, and they are well ahead of New York. And the German efficiency? Go figure… Comes only 5th, behind Italy and France. London is 9th, right above Hamburg and Los Angeles. The mighty German Ruhr? Not much more productive than the beautiful, sunny and (supposedly) lazy Rome. And I guess you would have never thought that the beautiful Berlin is 10% less productive than the equally beautiful Madrid, and 60% LESS productive than Milan or Randstad (pretty much half Holland, including Amsterdam), which are right at the top of the world.

Amazing.

Rank Metro Area GDP Resident Population k$ GDP/head
1  Randstad, Netherlands[5]  $281,190.00 4,172,000 67.4
2  Milan metropolitan area, Italy  $313,560.00 4,653,000 67.4
3 San Francisco  $487,000.00 7,468,000 65.2
4  Paris metropolitan area, France  $710,840.00 11,532,000 61.6
5  Munich Region, Germany1  $151,580.00 2,532,000 59.9
6 NYC  $1,280,517.00 22,214,000 57.6
7 Chicago  $532,331.00 9,729,000 54.7
8  Frankfurt/Rhine-Main, Germany[6]  $197,730.00 3,795,000 52.1
9  Greater London, United Kingdom  $605,410.00 11,917,000 50.8
10  Hamburg Metropolitan Region, Germany  $144,430.00 3,135,000 46.1
11 Los Angeles  $786,240.00 17,877,000 44.0
12  Rhine-Ruhr, Germany[2]  $430,170.00 10,223,000 42.1
13  Rome metropolitan area, Italy  $142,220.00 3,419,000 41.6
14  Madrid metropolitan area, Spain  $189,540.00 5,804,000 32.7
15  Berlin Metropolitan Region, Germany  $142,740.00 4,971,000 28.7

 

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I am proud, as all my folks are, to be working for PubMatic, the fastest growing advertising company in North America, the third fastest growing internet company, and the 20th fastest growing technology company.

It definitely means we are dong something very good, helpful, and value creating. And that is not just RTB or programmatic buying, but also Private Market Places, Audience, Mobile, Holistic/Unified Optimisation, and many other products that we have pioneered and are helping publishers grow everywhere in the world.

Please see the full Deloitte list here.

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Real-Time Bidding (RTB) spend has taken hold of the world’s digital advertising market, and with global growth in RTB expected to skyrocket from 2011’s £860 million to £8.6 billion in 2016 (an increase of 992%), RTB’s grip is set to tighten.

Last week at its AdRevenue 5 conference, PubMatic revealed the results of research firm IDC’s study into the future of RTB. As the study reported, the RTB sector experienced a successful year in 2011, where RTB display ad spend had increased 237.5% from 2010, and is predicted to continue its rapid growth – outstripping other formidable digital ad segments such as mobile and social.

The US is currently the most immersed in the RTB market. Being the first to embrace advertising technology platforms, it has the most developed digital environment and is predicted to continue leading the way. US RTB spend will grow from $1.1 billion in 2011 to $8.9 billion in 2016 at a compound annual growth rate (CAGR) of 53 percent. In the US, the market share of RTB-based spending of all display ad spending is also expected to increase from 10% in 2011 to 27% in 2016. RTB’s share of all indirect spending will grow from 28% to 78%……..

For the rest of the article, plus charts and tables, please check out the IAB UK site.

 

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