Research Library

Building a Successful Organization

The passage of Proposition lA in 2000 allowed many Indian gaming casinos in California to rapidly grow from small local oriented properties to regional gaming and entertainment destinations. Casinos that were once little more than bingo halls with class n gaming devices quickly became fullservice casinos offering guests a multitude of dining and entertainment options. Most significant to marketers was the addition of sophisticated player tracking systems that allowed Indian casinos to employ database marketing programs and analytical tools that were once only available to non-Native American casinos.

Unfortunately the staffing needs of marketing departments for many of these rapidly growing casinos often did not keep up with these hurried expansions. As such many casinos now find themselves marketing larger properties, promoting multiple dining options, expensive headliner entertainment, hotel, meeting space and greatly expanded gaming operations with virtually the same sized staff that they had prior to this period of growth.

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The Allure and Loathing of the Big Promotion

I t happens to every marketing director. It may be precipitated by an unexpected downturn in business, an aggressive advertising campaign or promotional offer by a competitor or the realization that revenues are falling below plan. Regardless of the cause, the chain of events starts with a visit from a senior official of the casino, most often the casino manager, to the marketing director’s office.

The casino manager will suggest the implementation of a big promotion to stimulate business. “We need something really big to get the gamblers in … we should give away lots of cash and a hot car or SUV” It makes no difference that such a promotion was not part of the casino’s strategy or the budget was created without such a planned promotion. The allure is just too great. The casino manager assures the marketer that “we’ll find the money for it. Just make it happen.” And so begins the saga of the big· promotion.

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And The Reason You Gave Me This Shirt Was…?

Recently I was asked to conduct a competitive profile of gaming properties in California. In addition to reviewing data on media expenditures, I made a point of spending three days in-market. I read through the newspapers, watched local television and listened to several radio channels. I then drove to each of the casino properties and made note of each competitor’s billboards, their theme and messages.

After walking through the first casino and reading the various posters and slot toppers that displayed the current promotions, I waited in line and joined the casino’s slot club. Upon completing my enrollment ti1e club rep handed me my card and asked, “What size t-shirt do you wear?” Perplexed, I answered “large” and was told all that was available was extra large and was handed a t-shirt. Without being given an explanation of how the club worked, I rolled the shirt up and completed my evaluation of the property.

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The Dangers of Marketing Cheap

Native American gaming operations have often looked to Nevada for insights into how to market their casinos. The general belief is that the marketing practices of Nevada casinos are based on sound research and experience, and have demonstrated themselves to be the best way of attracting and retaining qualified gaming prospects.

One of these marketing practices is the concept of attracting garners by discounting food, drinks and room rate to ridiculously low levels. Cheap meals, cheap drinks and low room rates have always been associated with Nevada casinos. The logic behind these practices is that by generating traffic through the property, a certain percentage of those people will stop and gamble. The exact percentage that do stop to gamble or their gaming budgets has never been determined.

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The Casino Marketing Plan: Objectives, Strategies and Action Plans

Last month this column focused on the first part of the casino marketing plan: conducting a thorough situation analysis in order to understand current and anticipated market conditions, the competition and the customer. Having performed this analysis, a casino marketing team can now focus on the development of realistic goals and objectives, a strategy that will achieve them and the specific action plans that become the marketing department’s “to do” list.

Too often the marketing team loses sight of the property’s mission. Operating a tribal gaming enterprise is more than about making money. It is about improving the quality of life for tribal members, providing security for future generations, offering employees opportunities for growth, and being a responsible member of the community. The marketing mission statement flows from the tribal mission but is also based on current market conditions. Once the team has prepared its situation analysis it is ready to develop the marketing mission d1at will guide the department’s efforts through the next year.

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The Situation Analysis

Before the casino management team formulates the objectives, strategies, action plans and budgets that comprise the marketing plan, they must first take stock of what occurred in the market over the past year and attempt to predict its future direction. This is called the Situation Analysis. Only with this analysis can the team formulate realistic goals and objectives and devise appropriate strategies and action plans. At a minimum the Situation Analysis should examine four basic areas: market analysis, the competition, the customer, and the property.

What happened and what will occur in the markets that the casino serves? Without fully understanding the economic, demographic and gaining trends in the market, any prediction of the property’s revenue/gaming growth would be nothing more than a guess.

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Developing a Casino Marketing Plan That Works

The phenomenon of casino development in the United States is a fairly recent trend. Outside the jurisdictions of Nevada and Atlantic City, casinos have existed for little more than a decade. Initially, marketing plan development and implementation were not critical factors in the success of these early operations. Casino operators were able to open facilities and implement a variety of marketing programs based more on individual managers’ personal experiences or to simply mimic what the competition was doing rather than develop marketing strategies and action plans based on their customer’s needs and market trends.

Today, a sizable number of Indian gaming properties operate in very competitive environments. As such, there is now a real need for casinos to develop and implement structured marketing plans.

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You Can’t Manage What You Can’t Measure

A fundamental axiom of business is that you cannot manage what you cannot measure and what can be measured can be improved. Few casino operators would discount the importance of customer service in today’s competitive gaming environment. Property managers almost always cite their customer service as a critical factor that sets them apart from their competition. In fact, customer service often appears as part of a casino’s mission statement or as a basis of its operating strategy.

To monitor customer service casinos often rely on comment cards that are placed around the property and are periodically tabulated. Casinos may also employ a more sophisticated version of comment cards in which a third-party provider prints, collects and tabulates customer comments. A monthly report is then made available. The fundamental problem with comment cards of any sort is that they usually only measure the the very satisfied or very dissatisfied. They are not an accurate form of measurement.

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Developing the Casino Marketing Plan

The phenomenon of casino development in the United States is a fairly recent trend. Outside the jurisdictions of Nevada and Atlantic City, casinos have existed for less than a decade. The initial success of riverboat. dockside and Native American gaming operations in the early 1990s was predicated more on operating in monopolistic or oligopolistic environments than on sound marketing practices. Marketing plan development and implementation were not critical factors in the initial success of these nascent operations. Rather. operators were able to open facilities and implement a variety of marketing programs based more on individual managers’ personal experiences. adapt the marketing programs of Nevada operators or to simply mimic what the competition was doing rather than develop marketing strategies and action plans-based on the customers’ needs and market trends. Today casinos in many jurisdictions operate in very competitive environments. As such there is now a need for casinos to develop and implement structured marketing plans.

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Cost-Effectiveness of Substance Abuse Treatment in Casino Hotels

One of today’s business realities is the prevalence of employee substance abuse – a particularly acute problem for the hospitality industry. Merely getting rid of substance-abusing employees is, at best, a cosmetic solution. Faced with labor shortages, growing “wrongful termination” litigation, and legislative mandates that promote a drug-free workplace and prohibit employee discrimination of recovering substance abusers, employers are investing in employee-assistance programs (EAPs) that provide substance-abuse treatment and permit the employer to retain an otherwise productive employee. Like any investment, a cost-benefit analysis such as that described in this article can provide a framework for evaluating the relative advantages of various types of EAPs.

Among the more tangible benefits of treating substance abusing employees is reduced turnover and absenteeism: expensive problems that otherwise might go unchecked. As a way of presenting our cost-benefit analysis, we compare the EAPs at two casino hotels which have quite different substance-abuse programs: the Mirage, in Las Vegas, and Merv Griffin’s Resorts International Hotel-Casino, in Atlantic City. In this article, we focus only on the programs’ effects on absenteeism and turnover, recognizing full well that there are many other benefits, both tangible and intangible, that accrue when employee substance-abuse problems are addressed by managers.

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