Strategy

It’s Labor Day Again?

Posted on August 16, 2003

Recently, a casino manager of a large local-oriented gaming property had an epiphany. He realized that Labor Day was only six weeks away and he wanted to do something for his regular players. He assembled his marketing team and together, created a plan to give each customer a gift on the holiday if they earned a certain number of slot club points. The general manager defined some caveats: the gift had to have the casino’s logo on it, it had to be something patriotic and it could not cost more than two dollars. The purchasing director and marketing director then ran off to contact their vendors and see what they could find.

Unfortunately, the items that were available in sizable quantities were limited. None of the samples impressed the general manager. Further, some of the available items could not accommodate
the casino’s logo. Worse, all of the items presented cost well in excess of two dollars. Meanwhile, the ad agency was contacted and asked to start work on an ad. However, until the item was selected, the agency could not produce anything more than thumbnail sketches.

View Full Article Read More

Database Segmentation Analysis

Posted on May 16, 2003

Casino management systems give the gaming marketer a wealth of information to better understand individual player behavior. Each successive generation of management systems allows casino operators to understand their customers and develop programs that recognize and reward loyal play. All casino management systems give the marketer detailed player information showing trip history, actual win/loss, theoretical win/loss, point and comp redemption history, as well as information on personal player data.

While casino management systems can accumulate vast stores of data on individual behavior they tend to fall short in their ability to summarize the behavior of player segments. The report writing tools that come with many of these systems tend to summarize transactional data to better assist the slot and table game departments rad1er than provide the marketing department
with useful information to conduct and analyze marketing campaigns. Fortunately, it is not too difficult to extract the data from the master system and analyze it using a relational database program. This technique does require individuals within the marketing department with advanced skills using relational database programs. Alternatively, the casino can turn to a database marketing consultant to perform a periodic analysis.

View Full Article Read More

The Marketing Systems Manager

Posted on April 17, 2003

Marketing and operations executives always have a need for information from their casino management system. Fortunately, designers of these systems predicted many of those needs and designed a series of reports that can be run by the system. Of course accessing those reports requires training and skills senior executives often do not have the time to learn. In addition, executives often have a need for information these reports cannot answer. Who then does the executive turn to in order to extract the information he/she needs to make an informed decision?

Every casino marketing department has a group of professionals that know how to perform certain operations within the casino management system. The bus manager knows how to set up groups, assign tracking codes and monitor the performance of each bus. The promotions/special events manager knows how to set up an event and track expenses, forecast revenue and prepare proformas. The database manager knows how to pull mailing lists given a set of gaming criteria. Each member understands specific components of the casino management system. Few, if any, know how to operate all of the marketing modules within the player tracking system.

View Full Article Read More

I Want a New Club

Posted on March 16, 2003

A mid-sized casino in the southeast recently replaced its casino management system. Marketing had grown frustrated with the system’s inability to do all of the things that it needed in order to be competitive. The marketing staff could not conduct electronic drawings. They were unable to award non-negotiable slot credits to player accounts and pulling data for periodic analysis was cumbersome and difficult. After much lobbying, the marketing department was finally able to convince senior management that a new system was needed if the property was to remain competitive. The system that was replaced was only three years old.

The vendor who had provided the casino management system was not invited to participate in the RFP process. Rather than re-invest in a system that did not deliver on all that was promised, the casino chose to look at other providers. In addition to the sizable capital cost, the casino endured a week of disruption as reader boxes and other hardware were replaced and the staff was retrained on the new system. Customers were also frustrated as points and comps did not transfer over accurately into the new system .

View Full Article Read More

Choosing a Competitive Business Strategy

Posted on January 16, 2003

When it comes to identifying an appropriate competitive strategy, casinos are no different than any other business. All businesses compete using one of two basic strategies: they employ a pricing strategy or a differentiation strategy.

Businesses that compete on price strive to offer the lowest possible price. They do so by reducing the costs of production in order to deliver a product or service at a price that is lower
than the competition. This strategy works well for commodities in which the products sold are undifferentiated. Wheat and oil are commodities and producers compete solely on price. Products that are clearly differentiated, through features or other unique elements, can command a higher price.

View Full Article Read More

Understanding Your Customers Through Market Research

Posted on October 17, 2002

When was the last time you withdrew $1,000 from your ATM with the sole purpose of visiting a nearby casino for an evening of gambling? Have you ever gambled in a casino six times in one month and lost $250 per visit? Have you ever drawn a marker for $5,000? If the answer is “no” then you are like most gaming executives. In fact most people in the general population do not gamble at these levels or frequencies yet the core customers that make up the most profitable segments of a typical casino most certainly do. There is no better example of the 80/20 rule than a basic segmentation analysis of an average casino. 80% of the gaming revenue comes from 20% of the database.

Many casino marketing executives devise promotions, design advertising campaigns and mail customer incentives without ever truly understanding what it is that motivates their core customers,
what the reasons are for their visiting a casino and what it is they seek in terms of rewards and recognition. Some executives will state that they “talk to their customers on the Boor” and through that process have an understanding of their customers’ desires.

View Full Article Read More

The Dangers of Marketing Cheap

Posted on June 17, 2002

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.

View Full Article Read More

Developing a Casino Marketing Plan That Works

Posted on March 16, 2002

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.

View Full Article Read More

You Can’t Manage What You Can’t Measure

Posted on February 17, 2002

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.

View Full Article Read More

Developing the Casino Marketing Plan

Posted on May 16, 2001

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.

View Full Article Read More