Land-Based Casinos Lag in AI Adoption, But Operational Gains Are Within Reach
Land-based casinos are falling behind online operators in adopting artificial intelligence, according to a report from the UNLV International Gaming Institute and KPMG released in April. The survey of 83 gambling companies found a clear gap: online operators and suppliers have moved faster to implement AI than their brick-and-mortar counterparts.
Rick Arpin, U.S. gaming leader at KPMG, presented the findings Wednesday at the International Conference on Gambling & Risk Taking. He said the industry's current focus remains on back-of-house operations and technology rather than customer-facing applications or regulatory compliance.
Three Barriers to Implementation
C.J. Foster, chief information officer for Station Casinos, identified the core obstacles: people, process, and technology.
Data integration poses a technical challenge. Casinos operate dozens of disparate systems that don't easily communicate with each other, making it difficult to compile comprehensive datasets for AI analysis. Technology itself shifts constantly, forcing operators to chase moving targets.
Regulatory constraints complicate process changes. Casinos operate under strict oversight, and modifying operational systems requires approval and careful documentation. Finding staff with the skills to use AI tools effectively remains difficult across the industry.
Where Casinos See Immediate Value
Foster expressed the most enthusiasm about database marketing and customer segmentation. AI can identify patterns in guest behavior, enabling one-on-one personalized marketing that goes beyond traditional approaches.
Lori Kobashigawa, senior vice president of marketing and innovation for Fontainebleau Las Vegas, emphasized hyper-personalization. Understanding who guests are-especially repeat visitors in the luxury segment-and tailoring their experience from arrival to departure creates competitive advantage.
Both executives framed AI as a tool to free staff from routine tasks, allowing them to focus on high-value guest interactions rather than replacing workers entirely.
The Guest Experience Gap
Patrick Miller, a hospitality and casino executive, noted a critical disconnect: consumers are already using AI to book rooms and plan itineraries faster than casinos are adapting their operations to meet those expectations.
"The consumer will figure it out sometimes before we do," Miller said. "We have to be attuned with how they're using it and approaching our products."
Casinos risk losing ground if they focus solely on operational efficiency while overlooking how guests interact with AI-enabled services. The industry must match the pace at which customers adopt the technology.
Regulatory Compliance: An Overlooked Opportunity
Arpin highlighted regulatory compliance as an underexplored area with significant potential. Rather than viewing AI as a compliance burden, regulators could use the technology themselves to strengthen oversight and reduce risk.
For operations professionals, the takeaway is clear: AI adoption requires coordinated effort across data infrastructure, staff training, and process redesign. The casinos moving fastest are those addressing all three simultaneously rather than pursuing isolated technology projects.
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