Marketing Myopia

You may wonder why I’m discussing marketing, but it’s a central issue when you’re switching from online to live games.

Theodore Levitt, a famous business writer, coined that term in a classic Harvard Business Review article. He urged business executives to focus on what their customers wanted and ask themselves, “What business are we in?”

Answering that question is most important when conditions change, and they are changing very rapidly in poker. Levitt criticized the railroads’ top executives for focusing on what they did well (running railroads) and ignoring what their customers wanted: to move goods and people quickly and efficiently.

If the railroad executives had focused on their customers, they would have started or purchased trucking companies and airlines. Instead, they fought a losing battle against them. Borders just went bankrupt because its executives thought they were in the bookstore business and didn’t realize that their customers wanted e-books and other products.

To switch successfully to B&M poker, you must understand that it’s a different business from online poker. B&M customers have somewhat different motives, and the key to succeeding in ANY business is satisfying your customers.

The smarter B&M pros will tell you, “I’m in the entertainment business. My ‘customers’ are the donators. If they don’t enjoy playing with me, they won’t give me their money.”

I discussed this issue in my blog, “How Much Should Online Players Socialize In B&M games?”

Most comments were negative because the most serious online players don’t want to socialize. They see their job as simply playing as well as possible. Everything else is irrelevant. They don’t understand that alienating the weak players will reduce their profits. And they deny an extremely obvious reality:B&M games are IMMEASURABLY more social than online ones.

Online poker is anti-social. Most serious players isolate themselves to avoid distractions, but B&M poker is a social game, and many of the players – especially the weakest ones (the best customers) – demand socializing. If they don’t get it, they don’t play.

That’s why cardrooms advertise, “Friendly Dealers.” Who cares if dealers are friendly? Not the pros. They just want the dealers to be efficient. But cardroom managers know that they must satisfy the social players. If the social players don’t come, then neither do the serious ones. It’s the “food chain” principle that applies everywhere. If there aren’t enough prey to feed them, the predators go someplace else.

This recession has made this principle much more important. Because the total number of players – especially the weakest ones – is decreasing, cardroom managers must work harder to survive. The same principle applies to every pro and semi-pro.

My blog made several points:
• First and most important, being anti-social was an asset when playing online because it helped you to stay focused on the action. However, it’s a liability in live games.
• Every smart businessperson follows a simple rule: “Keep your customers happy.”
• The weakest players tend to be the most social. They aren’t there to win money. They want to have a good time, and socializing is an important part of their fun.
• Socializing intelligently will produce several important benefits (increased action, saved bets, more information, more pleasure, and reduced danger of tilt).

Most readers’ comments ranged from rants to misunderstandings. I’ll ignore the rants, but one commentator’s misunderstandings are instructive.

SawItOff wrote: “I went from playing online to live, and I’m not all that social and still do well. I keep to myself and don’t speak much. I’m never rude, but unless I have to talk, I have nothing to say. I’m there to win money, not friends…Maybe in a 1-2 game your info might matter. But in 5-10 and up your suggestions are worthless.”

He made three errors that many B&M pros (and successful businesspeople) would easily spot.

Your Goal Shouldn’t Be To “Do Well.”

Smart business executives and poker pros don’t settle for “doing well.” They try to maximize their profits. If they think they can make more money by doing something new and different, they change their strategy, even if it makes them uncomfortable.

Because SawItOff doesn’t like to socialize, he doesn’t do it. Then he rationalizes that it doesn’t hurt him because he does well. He is oblivious about what his customers want, and that ignorance costs him money. The question is not, “Are you doing well?” It is, “How much better would you do if you made your customers happier?”

I’m There To Win Money, Not Friends.

Of course, you are. But, if you make friends with your best customers, you will win more money. They will give you more action, occasionally soft play when you’re beaten, and tell you about other players, promotions, and games.

In addition, if you’re in a more relaxed social environment, your “work” will be less stressful. You wouldn’t want a 9-5 job where your co-workers disliked you. Why play poker with people who feel that way?

SawItOff said he wasn’t rude, but the weakest, most social players will often interpret refusing to talk to them as rudeness. Or they will see you as being “anti-social,” “too serious,” or even “cutthroat.”

You may say, “Who cares what those jerks think?”

A smart B&M pro cares, and, if you want to become one of them, you’d better start caring.

Motives Don’t Change As Games Get Bigger.

SawItOff made an extremely common error: He essentially believes: “We’re different.” Countless poker players (and people in general) make that mistake. There is a natural desire to think that people at our level are fundamentally different from the ones below us. He wrote that the players in smaller games might care about socializing, but “in 5-10 and up your suggestions are worthless.”

The bigger the game, the more skilled the players become, but they still play for the same old reasons. They want to win money, get the kick of gambling, challenge competitors, pass time, meet people and socialize with them.

SawItOff has it exactly backwards. The bigger the game is, the more important socializing becomes. Of course, players don’t socialize as much in larger games, but some of them, especially the weakest players, do want to socialize.

Two top pros, Ray Zee and David Fromm, wrote (and I edited) a manuscript about limit games of $150-$300 and up. Here’s what they wrote about weak players: “If they enjoy playing with you, they may welcome you to their game and gamble with you… They don’t mind giving away an edge because they’re playing for fun.”

As games get bigger, the donators become more demanding, not less. Big customers demand more than small ones everywhere. For example, shoppers at Nieman Marcus demand much more than Walmart customers. High rollers demand more than small gamblers. In fact, casinos have hosts whose entire job is keeping high rollers happy.

High rollers can demand and get more because there aren’t many of them. If a $1/$2 player leaves, it’s not important. There are dozens to take his place. If a donator leaves a big game, it often breaks up.

As games get bigger, the number of fish slowly gets smaller. Card Player columnist, Barry Tanenbaum, worked his way up, level by level, to $40-$80, and he said, “For every level you move up, one weak player is replaced by a stronger one.” David Sklansky, poker’s foremost theorist, usually plays $100-$200 or $200-$400 limit or $25/$50 no limit. He told me, “I’m almost never in a game with more than two bad players.”

The biggest games are usually built around one donator. Top pros like Doyle Brunson, Barry Greenstein, Jennifer Harmon, and Phil Ivey can’t make much money from each other. So the biggest games may not even start without a rich tourist.

If you asked any of the top pros, “Do you socialize with rich tourists?” they would be shocked by your dumb question. Of course, they do. They couldn’t make much money without those people, and they must make them comfortable.

Don’t make SawItOff’s mistakes. Do what the smart B&M pros do: Make your best customers want to play with you. The happier they are, the more money they’ll give you.