The WSOP Ladies Event "Discount" Blunder

“The essence of strategy is choosing what not to do.”

~Harvard Business School Professor Michael E. Porter

Yesterday, the 2013 World Series of Poker schedule was announced. Most of the immediate reaction was focused on Event 51, the long traditional and recently controversial "Ladies Event". It's become one of poker's most hallowed rituals—a chorus of complaints that the Ladies Event is unfair discrimination against men and condescending to women, followed by a responsive chorus of defenses of the Ladies Event as a time-honored WSOP tradition that is a fun and entertaining event for women who would not otherwise play big buy-in tournament poker. Unfortunately, this ritual debate has devolved into zombie arguments, beaten to death, resurrected, and beaten to death again, lying in shallow graves waiting for the first full moon after the summer solstice for the magic incantation of "Ladies, shuffle up and deal!" to call them forth. [FN1].

I have long maintained that all the bickering about the Ladies Event just results in a lot of unhappiness being spread around the poker world. Men are unhappy they can't play the supposedly weaker competition in the Ladies Event, at least without WSOP officials hassling them. WSOP officials are unhappy that men are ruining the fun of their Ladies Event, so they feel compelled to get medieval on the spoilsports. Women are unhappy that men are ruining their day in the sun by playing in their event, unless, of course, they are unhappy that men aren't allowed to play in their event. 

This year, even though we are four months out from the start of the Ladies Event, the old arguments got a new twist. As Shamus observed over at Hard-Boiled Poker, WSOP officials gave the ladies a Valentine of sorts this year, making the Ladies Event officially a $10K buy-in tournament, but giving all women a $9K "discount" on their entry fees. Or, from the other point of view, WSOP officials went up to all the male players considering entering the Ladies Event, looked them dead in their Blue Shark sunglasses, flipped them the bird, then spit on their baller shoes.

Of course, the "ladies' discount" is really just a cynical ploy by the WSOP to find some way to keep out those pesky, uncouth men who have been crashing the ladies' poker party the past few years. Openly banning men from the Ladies Event is illegal under anti-discrimination laws, while strong-arm tactics like threats of player suspensions have been ineffective (and probably illegal if implemented). But the "ladies' discount" gambit is an interesting ploy. Nevada law expressly allows "differential pricing, discounted pricing or special offers based on sex to promote or market the place of public accommodation.” Although intended to permit promotions like "ladies nights" to attract women to bars or clubs, the law appears drawn broadly enough to permit a "ladies discount" for a poker tournament. [FN2].

Based on my Twitter feed yesterday, it seems like many poker players and poker media members regard the "ladies discount" as a good idea. Change100 called the discount idea "genius", while Daniel Negreanu tweeted:

Bravo @WSOP addressing the issue of "men" playing ladies events by making it a $10k and giving ladies a $9k discount! Very clever!

Clever? Well, it certainly is legally creative; I give the WSOP that much. But as I often tell my clients, just because something is legal doesn't mean it's a good idea.

The problem with the WSOP's "ladies discount" gambit is that it sacrifices the WSOP's strategic position of moral superiority in the debate over the Ladies Event in exchange for the marginal tactical advantage of having a legal tool for preventing most men from playing in the event. Prior to this year, although the Ladies Event discriminated against men, the WSOP could defend the discrimination by pointing to the availabillity of numerous other open WSOP tournaments at similar low buy-ins which were available for critics of the Ladies Event. Now, the Ladies Event is nominally a $10K event for men, giving those men no realistic comparable WSOP tournament alternative to the de facto $1K tournament offered solely to women. Further, men entering the Ladies Event will have to pay ten times the entry fee for the same chance of winning the tournament as for women players; the WSOP presumably will not be kicking in an additional $9K to the prize pool for every women player, nor will men presumably be given ten times as many starting tournament chips. [FN3]. Consequently, men who enter the tournament will be at a real disadvantage to women in terms of tournament equity and expected return on investment, and the WSOP intentionally wants men to be at such a disadvantage. Just think of the public relations nightmare for the WSOP when a man pays the $10K buy-in and makes the final table or even wins the event and spouts off in interviews: "Hey, I had to give these women 10-to-1 odds, and I still beat them!" Talk about a credibility killer.

The Ladies Event through its history hasn't continued as a women-only (or women-mostly) event because it is technically legal to exclude men. It has continued as a women-only event because of etiquette, because of gentlemen and their manners. Gentlemen have understood that demanding to play in the Ladies Event is simply rude, regardless of whether they could force the WSOP to let them play as a matter of right. The women-only "rule" to this point has been enforced simply by social agreement to let those women who wanted to play the Ladies Event enjoy their special tournament as a matter of courtesy. But changing the rules as the WSOP has done alters the etiquette equilibrium. The new "ladies discount" rule changes the landscape from a place where the WSOP carved out a small niche tournament for a group of women poker players, to a place where the WSOP is actively placing men at a significant disadvantage to women in a tournament. Those complaints of discrimination by men that once came off as petty whining suddenly take on a lot more gravity.

In my view, the "ladies discount" rule forfeits the WSOP's moral high ground in the Ladies Event debate. The WSOP is basically claiming it needs a 10-to-1 buy-in ratio to protect the Ladies Event, and by extension the ladies participating in the event, from all those awful male poker players. In my book, that implicit attitude changes the Ladies Event from charming to demeaning, and from celebratory to vitriolic. In a word, the rule is rude.

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[FN1]  I have contributed my own zombie arguments to the Ladies Event debate, submitting a modest proposal for a compromise satisfactory to all sides, and making a demand for attention to a similar issue in the world of bingo.

[FN2]  I haven't researched the relevant Nevada anti-discrimination laws personally, as I presume Caesars Entertainment (owner of the WSOP) has had its attorneys review and approve the ladies discount "promotion". However, I presume Nevada courts would likely put some boundaries on the sorts of marketing ploys that would be permissible under the differential pricing/marketing exception. For example, if the difference in pricing were so large as to render the goods or services at issue unavailable to men as a practical matter—say, a $500 gin and tonic, or a $10 million poker tournament entry fee—I could see a court holding that the price difference was an illegal pretext for discrimination. Here, even though the intent of the Ladies Event price differential is to encourage men to sit out, arguably the $10K entry fee is not inconsistent with a number of other WSOP events, and the fee is only ten times the price charged to women (equivalent to charging men $10 per drink, while women are charged only $1 per drink). In other words, although there is likely a line to be drawn between legal pricing and marketing differentials intended to encourage women to buy particular goods or services and illegal pretextual pricing and marketing differentials intended to exclude men entirely, the WSOP's $9K discount for women doesn't seem to have crossed it.

[FN3]  It will be interesting to see if the Nevada gaming authorities would object to a purportedly open poker tournament where some players are forced to pay a substantially greater entry fee for the same chance to win the tournament as other players.