High Rollers Enjoy a Lower House Edge
It is self-evident that casinos want to attract and keep high rollers; after all, they offer the promise of far larger profits than low rollers. That is why the house edge on high limit tables is often much smaller than at low limit tables.
For example, if you do a survey of Las Vegas blackjack tables, you will find that those with a minimum bet of $100 have a house edge of around 0.255% to 0.285%. When looking at tables with a minimum bet of $5 or $10 the house edge is closer to 1.5% to 1.9%. This change is achieved by using rules that are more favourable at the high limit tables, such as fewer decks of cards.
The same principle can be found at many other table games. For example, French Roulette, which has a house edge of just 1.35% may have a minimum bet of $50 while American Roulette, which has a house edge of 5.26%, may have a much lower minimum bet of $5 or $10.
Essentially, casinos can afford to do this as they will still be making large profits from high rollers, even with much lower house edges, due to the size of bets involved.
Casinos Will Often Accommodate High Rollers’ Requests
As discussed above, those who are betting $50 or $100 per hand/round will enjoy rules that are more favourable. However, very often, those who bet serious amounts will be able to negotiate for better rules and even casino comps.
The most famous example of this is the blackjack player Don Johnson who managed to secure such favourable rules that he won over $15 million. Following the financial crisis, Johnson knew that casinos were desperate for custom and he approached Atlantic City casinos about playing Blackjack for $100,000 a hand. Because he was willing to bet such significant amounts, the casinos were willing to negotiate.
At first, the casinos offered him standard comps and a few special perks, such as a private jet flying him to the casino. However, this was of no interest to Johnson. He wanted to play with the best blackjack rules and have a loss rebate.
In the end, Johnson managed to negotiate rules that resulted in a house edge of just 0.25%, and he received a 20% loss rebate that reset every day. This means that if he lost $500,000 playing, he would actually only have lost $400,000 due to the loss rebate.
What followed was fantastic for Johnson. He won $5.8 million from the Tropicana, $5 million from the Borgata and $4 million from Caesars. Of course, this is an extreme example, but it demonstrates how much space casinos are willing to give high rollers.
Even High Limit Slots Favour High Rollers
You may have thought that there was no real advantage to being a high roller when it comes to slot machines. However, if you inspect the machines carefully, you will notice that the higher the domination the machine, the higher the payback rate.
If you visit a typical American land casinos, you will find that penny slots have a house edge of between 10% and 15%, nickel slots of between 8% and 15%, dollar slots of around 5% or 6%, $5 slots of between 3% and 5%, and $25 slots of 3% or less.
However, it can be hard to find the payback rate for individual machines. This is because the same machine may have a different rate in each casino. That is why it is best to work according to the machine denominations rather than individual games.
Of course, if you are betting large amounts and you play for an hour, even with the higher payback rate you run a real risk of losing large amounts of money. Ultimately, it is up to you to find a balance between what you can afford to risk and the machines’ payback rates.
High Rollers Are Still Subject to Upper Betting Limits
You may think that a casino would be willing to allow a high roller to bet as much as they wish. However, this is not the case. Even high limit tables will have an upper betting limit.
The reason for this is mainly to stop players from using the Martingale betting system. The Martingale system, which requires players to double their bets after a loss, is one of the few systems that will theoretically always return a profit.
If you have the resources to keep doubling your bet without limit until you win, then you should eventually win and make a profit. The downside to the system is that the bets become big very quickly. For instance, if you were to start with a $1 bet, after just ten rounds you would be betting $1,024. If you were playing at a table with a $100 minimum, then this would be $102,400.
While this may sound like a vast amount, there are certainly gamblers who can afford it, and this is why casinos will impose an upper betting limit. Otherwise, they would face making a loss every time that player sat down.
Casinos also impose an upper limit to make sure that a gambler on a winning streak does not catch them out. The most famous example of this is the story of Tom Breitling and Tim Poster. The pair bought the Golden Nugget casino in Vegas for $50 million in 2004. They began offering low house edges and high limits to attract high rollers. This worked well for close to a year until a high roller won $8.5 million and wiped out the casino’s profits for that year. After that, the pair decided to make use of betting limits that were more traditional.
Online Casinos Also Work Hard to Accommodate High Rollers
It is not just land casinos that do all they can to attract high rollers, online casinos do the same. A common example of this is deposit and withdrawal limits.
Nearly all online casinos have minimum and maximum amounts for both deposits and withdrawals. However, for high rollers these limits are usually far higher. For example, a regular player may only be able to deposit $5,000 a week while a high roller may be able to deposit $50,000. The same is true of withdrawal limits, but these are also linked to local regulations (for example, in the UK it is illegal to impose a withdrawal limit).
Online casinos also have special tables for high rollers, particularly in live casinos, with much higher betting limits (check out the Salon Prive tables here at Regent Play), while high rollers will also be able to earn some fantastic rewards through casino loyalty schemes.
Casinos Are Prepared to Take Risks to Attract High Rollers
Many land casinos will offer their highest rollers credit to make things as convenient as possible for the player and to keep them at the tables. However, this is of course a risk for the casino, as the player may not repay the debt.
For example, Terrance Watanabe was a businessman who loved gambling to the point that he lost $220 million in five years. Many casinos gave him credit, some of which he must have paid back, but Caesars Entertainment sued him for not repaying $14.75 million.
A risk for casinos is that a player may declare bankruptcy to avoid paying their debts. Some gamblers have also claimed that they are gambling addicts and the casino is taking advantage of them. However, since the credit arrangement is still very common, it is safe to assume that casinos are doing well out of it.
High Rollers Enjoy Numerous Gifts
In a gambling town like Vegas, all the big casinos offer a very similar collection of games. Therefore, the casinos need to work hard to attract the highest rollers. One way of doing this is through comps and making life as smooth for the player as possible.
However, there is no point in offering a player a free room if a superior casino is doing the same. That is why casinos need to have luxurious hotels with all the amenities a high roller could wish for, from fine restaurants to gyms, spas, and so on. The casinos will also have hosts who build a relationship with the high rollers to learn what they like and how to best accommodate them.
In exchange for this, players will often sign a contract stating that they will play a minimum number of hands with a minimum bet. For example, a blackjack player may be required to play for at least eight hours at $1,000 per hand.
In other words, if you can make it worthwhile for the casino, they really will give you an experience that you will never forget.