In various news reports about the bankruptcy of the unit of Caesars that includes Caesars Palace, and discussion that the rest of the Caesars company might be forced to also declare bankruptcy, there is sometimes mention about the Total Rewards players club program and how valuable it is.
In another thread I wrote that I think Total Rewards has no real value to anyone but Caesars.
I think it's worth discussing since Caesars is a publicly traded stock and there are others who invest in other gaming companies.
So there are two quesitons: If you had to put a value on the Total Rewards program for the purpose of selling it in a bankruptcy, how much is it worth? And, if you bought it, what would you do with it?
I maintain that the Total Rewards program is of no value to anyone except as a mailing and telephone list of casino gamblers with information about their credit and gambling habits. And that's something that really has limited value -- if any value at all.
Other casino companies can create their own database of their own customers and as new customers join their programs they can add. Seeing what Caesars has or had is of no value.
What about non-casino companies?
If American Airlines bought the Total Rewards system they couldn't offer free hotel stays in any of the casino resorts. So again, American Airlines would only be buying a mailing list.
If American Express bought the Total Rewards system they couldn't offer free play or show tickets to those on the list because Amex has no casinos and no showrooms. Why offer loss leaders when you don't have businesses to lead customers to?
Now what about another casino company -- say Wynn, for example. If Wynn bought the Total Rewards system they wouldn't want to take on the liability of all of the comps and Reward Credits and "tier level privileges" that Caesars handed out for previous play. In other words -- Wynn would only value it as a mailing list, albeit a list of players and their spending habits. But does Wynn need it?
So all you have left is a mailing list.
This is why I think Total Rewards is worthless to anyone but Caesars. And I think investors and the media were sold a bill of goods that Total Rewards is any kind of valuable, marketable asset.
If there is an asset (and I am taking a guess here) it's the software that analyzes player habits. But I have to ask, do you really have to buy Total Rewards to research your own data?