What Research Is Your Casino Doing?

USE THESE INDUSTRY AVERAGES TO SEE HOW YOU COMPARE

By Deb Hilgeman, Ph.D., Senior Raving Partner, Market Research

Raving recently completed the 2nd Annual Indian Gaming National Marketing Survey. One of the objectives of this annual study is to help marketing practitioners understand current practices and to see where their property falls on the spectrum.

For example, a key finding of this year’s study is that 50% of casinos are now actively working with Big Data, compared to only 6% last year; this is a huge shift. Are you in the half that is now using Big Data or are you in the half that hasn’t embraced this yet? If so, you are probably going to be in the minority next year.

One of the questions we asked casinos is to determine what types of research they’re conducting. Overall, more than half of all casinos are doing at least five key types of research: Database Analysis, Competitive Analysis, Guest Satisfaction Surveys, Employee Engagement Surveys and Feedback Surveys. The most often used type of research is Database Analysis, and the least often used is Branding & Awareness.

There were no huge shifts in research patterns year-to-year but there were some changes as noted below:

  • Database analysis: 91% last year to 90% this year so basically unchanged
  • Competitive reviews: Increased from 61% last year to 69% this year
  • Guest satisfaction surveys: Decreased from 79% last year to 69% this year
  • Employee engagement: Increased from 41% last year to 53% this year
  • Branding & awareness: Decreased from 45% last year to 32% this year
  • Focus groups: 41% last year to 44% this year so basically unchanged

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Incorporating Evidence-Based Decision Making Into Your Business Model

INCORPORATING EVIDENCE-BASED DECISION MAKING INTO YOUR BUSINESS MODEL

By Deana Scott, Raving CEO

Lately, I have been evaluating how successful businesses incorporate an evidence-based decision making process to increase profits in a highly competitive economy where old business models are dying.

What is it?

Evidence-based decision making is a process for making decisions about business practices, strategies and policy developments that are founded on research and evidence from the field and relevant, contextual information. This method allows us to make decisions that are actionable and measurable.

Fierce competition from disruptive new technology and increasing online services are creating a high level of financial uncertainty for many businesses including the casino industry. So, in this fast-paced evolving business climate, does using research as a foundation to make evidence-based decisions improve financial performance?

According to a Harvard Business Review study, companies who create a “Culture of evidence-based decision making have all seen improvements in business performance.” And more alarming, in the study of 51 companies, they found those who use data are rare.

How does that compare to the casino gaming industry?

According to Raving’s 2016 Annual Indian Gaming National Marketing Survey*, a majority of properties reported that they conduct numerous types of research.  However, this does not answer the question as to whether they use it.

We know we need it, and we say we are conducting it, but is there a gap between conducting it and using it to make evidence-based decisions? After interviewing numerous casino operators and two of our industry’s leading market researchers, the answer is “no.” Some level of data is collected, but typically it isn’t sufficient to credibly implement a culture of an evidence-based, decision making process.

As an example, I worked with a property with an 1100-seat bingo hall located in an area with under 30,000 people. The bingo manager was tasked with filling the hall seven days a week with matinee sessions on Saturday and Sunday. After a couple of years of losing about $250K a year and not filling the room, I was asked to help “fix” bingo. I was told that the room should be packed nightly. My first question was, “Do you have the research or feasibility study that was done to base this expectation on?” The answer stunned me, “No, we built the room this big for future gaming expansion, but we should be able to fill it because Foxwoods does and they are in a similar rural location.” Yes, the property was remote, but it was not located anywhere near the population surrounding Foxwoods. So, for two years, the property lost over a million dollars based on a flawed assumption.

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Start Making Data-Driven Decisions in Three Easy Steps

HOW TO MAKE DATA-DRIVEN DECISIONS - PART II

By Sarah Procopio, Raving Partner, Database Analytics
In my last article, we talked about making data-driven decisions (decisions that can be backed up with verifiable data). We also talked about why they are so important – because this approach saves your company time and money while adding credibility to your cause. (For more information, see the full article Why Data-Driven Decisions are Crucial to Your Performance – Part I.) Now, let’s talk about how to make them.

Here are three easy steps to begin making data-driven decisions:

1. Pick the right metrics.

Most casinos get buried in the detail of 30 to 300 metrics and lose sight of the big picture. You would be shocked by how many people get so caught up in looking at the details that they forget to check to see if they generated revenue and made a profit. At the end of the day, that is what matters for the casino overall. One of the most important steps is to pick the right metrics to look at. If you aren’t sure what these are specific to your department, that’s okay. Get help from someone you know and trust. If you are the one expected to know, reach out to a friend that holds the same position at another property. Ask them, “If you could only pick three key data points on your reports to consider for operating your business, what would they be?” Don’t stop there. Ask, “Why those? What do they tell you? What is an example of those metrics raising a red flag? What is an example that shows you are operating your department well?”

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Resurrecting Inactive Guests Through Exclusivity and Personalization

RESURRECTING INACTIVE CUSTOMERS THROUGH EXCLUSIVITY AND PERSONALIZATION

By Jerry Epstein, Raving Partner and CEO, Engaged Nation

Customer reactivation is one of the bigger challenges casino marketing professionals face, as traditional marketing efforts continue to prove the law of diminishing return. This is especially true for smaller, tribal properties that can be in somewhat remote locations. But you don’t have to be Dr. Frankenstein to reanimate these “dead” customers … you just need to show them a little bit of love and make them feel special in a way they aren’t used to receiving on a regular basis.

Unfortunately, you’re not going to be able to accomplish this using the passive and typical "one touch" method of engagement (sending out a single email or direct mail piece that essentially re-introduces yourself each time). You will simply continue to be ignored.

You need to create a scenario whereby your dormant customer, regardless of level of segmentation, is given an opportunity to participate in a promotion that truly establishes an air of exclusivity with a high perceived value, the rewards are “earned” or “won” but – and here’s the important part – also drive profitable property visits and incremental revenue.

Easier said than done, right? Nope. It just takes a bit of ingenuity and a willingness to get out of your comfort zone.

For instance, we recently helped one of our clients implement a reengagement strategy that was customized per person, cost them nothing to participate, described as "by invitation” and only made available to players for 12 weeks to give it a greater appearance of exclusivity and sense of urgency.

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An Underutilized Tool for a Competitive Advantage

"Casinos that have a competitive advantage are those that can see the possibilities of using research in ways that their competitors may not be doing yet-which group do you fall into?"

By Deb Hilgeman, Ph.D., Senior Raving Partner, Market Research

Let’s start with a short quiz …

1. Does your casino use research to answer these questions?

  • How satisfied are our customers with the various components of our casino resort?” This is an easy one. Raving’s 1st Annual Tribal Gaming National Marketing Survey showed that 79% of casinos are using satisfaction surveys that can be really helpfuls in identifying what you’re doing right and what needs to be improved.
  •  

  • “How do players in our market area compare us to our competitors?” This is another easy one. Competitive research is a tool being used by 61% of casinos. This can be as sophisticated or as simple as you want to make it.
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  • “How is our brand perceived by people in our market area?” Brand assessment research is being conducted by 45% of casinos. This can tell you how well your advertising and marketing is working. 

 

If you answered “yes,” your property is utilizing research like several other casinos. Hopefully, your casino is using satisfaction surveys, competitive analysis, brand assessments and other types of research to provide you with valuable business intelligence.

Casinos that have a competitive advantage are those that can see the possibilities of using research in ways that their competitors may not be doing yet.

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Raving Flash! Does Guest Service Drive Visits?

How much does customer service drive visits? You might be surprised ...

By Deb Hilgeman, Ph.D., Senior Raving Partner, Market Research

I’ve written before about the value of conducting an annual players club survey of your customers. This measures how your players perceive your club’s structure and benefits, how valuable the club is to your players, and how it can show you what needs fixing and what you need to maintain.  (Read my article: Does your Players Club Need an Annual Checkup?)

One question in the survey asks how important certain things are when the person is choosing a casino to visit. A list of standard casino features is included in the question and customers are asked to rank the importance of each on a scale of “1” to “5,” with “1” being “not at all important” and “5” being “very important.”

I’m used to seeing certain patterns: Slots, Promotions, Players Club Benefits and Direct Mail are almost always the top four visit drivers as ranked by importance. Customer Service occasionally ranks in the top four, but I’ve never seen it in first place. For some casinos, Promotions may be first place. For other casinos, it’s Players Club Benefits as the most important visit driver. Slots is the choice most often in the top spot.

A players club survey I just finished had a surprising result for this question: Customer Service was ranked ahead of Slots, Promotions, Players Club Benefits and Direct Mail as the number one factor that drives a casino visit in this particular market. Customer Service as the number one driver in a casino market?! I’ve never seen this before so it made me think about this result.

We all know that customer service is important, but since it has never shown up in first place before on other players club surveys that I’ve conducted, it seems that either:

    1. Customers assume that good Customer Service is a foundational part of the visit experience, just like they expect the lights to be on in the casino. So, they don’t include it as a top visit driver.
    2. Or, customers in some markets, may really value Customer Service as being more important than Slots, Promotions, Players Club Benefits and Direct Mail in choosing a casino to visit.

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How To Use Performance Measurement To Gauge Marketing Investment

Are you sure your marketing investment is profitable?
What my son’s swimming experience taught me about the importance of performance measurement

Azam Husain, Raving Partner, Microsoft and BI Software Training

My 12-year-old son, Gil, started competitive swimming this year. As a data guy, I look at my son’s swimming activity under a different lens than most parents. I try to find meaning in all of the swim data: start time, intermediate time, finish time, improvement time, placement, aggregate swimmer times, etc.

Prior to Gil’s first swim meet, I knew his best event would be the 50m breaststroke. His weakest event would be the 50m butterfly. So, in my mind, I had set my assumptions on Gil’s performance. Sure enough, he excelled at the breaststroke. But, to my surprise, he also performed well in the butterfly. The data also showed an unexpected problem. So, what happened?

At the start of Gil’s 50m butterfly, he entered the water in a weak position. He was last off of the starting block, and didn’t jump out far enough. His time underwater before breaking to the surface was short. This meant he needed to start into his stroke sooner, which is a disadvantage. (Off the block swimmers try to stay underwater as long as possible to maximize their start speed before surfacing.) I was already thinking that a slow start along with a weak stroke would likely mean a finish close to the bottom. But, to my surprise, Gil made up the time and finished 3rd. Continue reading

Guest Comment Cards: Are They Worth the Effort?

Guest comment cards: 
Are they worth the effort?

By Deb Hilgeman, Ph.D., Raving Partner, Market Research

Many casinos rely on guest comment cards for getting customers to tell them what’s on their minds. The cards are usually available at the players club, food venues or other locations where they can be filled out, put in a box and reviewed by management.

There are a few ways to improve guest comment cards, but not all issues can be solved by using comment cards alone. One of the top benefits of using comment cards is that they provide useful information and insights into problem areas. The downside of comment cards is that only one to two percent of guests take the time to fill out the card, so they’re not reflecting the majority of guests’ opinions. In fact, virtually all people who fill out comment cards have either had a really bad experience or a really good one, so all you’re seeing are the extremes.

If you’re currently using guest comment cards or considering them, then keep the following in mind:

1. Comment Cards Don’t Fix the Problem for This Customer

While comment cards allow you to identify and fix problems, it’s too late for the guests who had such a lousy experience that they’re compelled to write about it in a comment card. The bad impressions that these guests experience are taken home with them and probably shared with several other people. In short, comment cards fix the future, not the present. Continue reading

Are Millennials Short on Brains or Are We Just Old

Are millennials really “sort of short on brains*” or …
Is current management just too old to understand this demographic?

By Christine Faria

Dear Ravers,

When Steve Wynn* spoke at the International Conference on Gambling & Risk Taking he said that, “They (millennials) get older later so maybe when they’re about 60, we’ll have a chance to get some common sense out of them. In the meantime, we’re doing well with the little darlings in our nightclubs.” He might not understand this age group, but he certainly appreciates the non-gaming revenue.

gency-warren Gency, our 29-year old marketing manager (pictured to the right) laughs when she sees this big headline about “being short on brains” on my computer screen as I’m writing this article.

She’s our “token millennial” that we run things by for her unique generational perspective.

This millennial topic is pervasive throughout our industry now – in articles and conference sessions. “The future of gaming is at risk! What to do about those millennials??” So much chatter and worry around this age group (ages 17 to 36) who would surgically embed a phone or camera into their bodies if they could.

A very unscientific gathering of data

With Gency’s help, I gathered feedback of a total of 10 “kids” from different parts of the country to get the scoop on their thoughts on casinos. All, except one, had their bachelor’s degree and one had their medical doctorate.

Similar to what Mister Wynn has discovered; all of my interviewees go to casinos occasionally for reasons other than gambling: restaurants, bars and concerts and always with groups of friends. None of the respondents would go to a casino as a resort destination.

And if you think that Wynn’s comment of “short on brains” is harsh, this is what Russ (24, estimator, Reno) responded with to my question about what turns you off about casinos: Continue reading

Busted – The Myths Around Loyalty Marketing

Busting loyalty myths
New research reveals what customers really think – and feel – about loyalty programs

Deb Hilgeman - Lifestyle Segmentation

Deb Hilgeman

Deb Hilgeman, Ph.D., Raving Partner, Market Research

We’ve all heard it and discussed it, and there’s no simple answer to this question: How well is our loyalty program (LP) doing? We measure carded play, but what does that really tell us other than what percent of our customers are using their players club card? It doesn’t tell us how our customers feel about our LP, or how our club benefits stack up against our competitors. The truth is, we spend a big chunk of our marketing budget on players club programs, but we don’t really understand them.

Loyalty360, a free online resource if you haven’t checked it out before (www.loyalty360.org), recently hosted a webinar that presented new customer research on loyalty programs. The study included 2,000 people age 18 and over, and was evenly distributed across Millennials, Gen Xers and Boomers. Respondents belonged to at least one loyalty program.

Here are two key findings:

Myth #1: Convincing a customer to enroll in your program is equivalent to convincing them to engage in your program. 

If only it were that easy! Unfortunately, getting a customer to sign up for the players club and issuing them a card is only the first step. Why do some customers become active program participants and others just don’t? Here’s what the results showed when people were asked why they did not become or stay engaged in a loyalty program after joining:

  • 41% Benefits are too hard to earn or take too long to earn.
  • 22% Rules are confusing or unclear.
  • 19% Program is boring.
  • 18% Not enough reminders/communication about the program after I joined.
  • 17%  Benefits/rewards are not appealing to me.

The takeaway from these results is that we have to make sure there is an easy way to obtain at least some type of reward (buffet discount, free entries, etc.), and that members understand this process. Make sure that they know how to earn and redeem points, and what they can be used for. Communications that you send to club members should clearly explain benefits and how they can be earned. The first few months after a person joins are the most critical, so review your new member policies and see what you can do to beef up members’ learning curve about your program.

Myth #2: Consumers primarily join loyalty programs for mercenary reasons.

This study identified four main reasons why people join loyalty programs. While earning rewards is the top reason, less than half of customers say that this is why they join a loyalty program.

  • Mercenary – 43% (I wanted to earn rewards.)
  • Inertia – 31% (Easy or automatic to join – no effort on my part.)
  • True Loyalist – 17% (I love the company’s products and services.)
  • Cult – 5% (I identify with the company’s purpose and values, and feel part of the “community” with other customers.)

Continue reading