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Raving Consulting’s 16th Indian Gaming National Marketing Conference, which took place on January 27-29, provided a few actionable and easy-to-grasp insights regarding both the state and direction of casino marketing for tribal and commercial casinos.

Raving’s presenters consistently strike a good balance between diving deep into the details and presenting information that is easily accessible, new and actionable. Raving is to be commended for keeping the presentations focused on delivering concrete ideas to attendees, including strategies that they can implement without Raving’s help or that do not require a major expenditure. In particular, three presentations stood out…

  1. Nicole Barker’s (Raving Partner for Database and Loyalty Marketing) session titled “Die Tiers Die…Why tiering systems have rarely worked in Casino Marketing” was the first one. It focused less on providing examples of where patron tiering systems have failed, and more on why they fail and what questions to answer before setting them up. The presentation highlighted ways in which casino offers can frustrate players, causing the casino to fail at increasing its wallet share with those patrons. Nicole provided some great practical advice, and in particular two prescriptions stood out: do not gift (i.e., promote someone to a higher tier that they have not yet earned in the hopes this will lead to a change in behavior) and demote regularly (i.e., move a patron to a lower tier quickly if their behavior changes rather than hoping they’ll revert to their former behavior).
     
    I disagree with the first argument that gifting (which involves a tangible expense to the casino) does not yield a positive ROI after taking into account the average player’s change in behavior. I believe gifting can be a very effective strategy, but only in cases where the gift of being elevated to the next tier for a short time is based on the knowledge that the patron can increase their play to the new level (something you can easily verify using a tool such as Casino Share Intelligence).

    Demoting players quickly I do agree with, and yet casinos only reluctantly do it since they’re concerned that the player will punish the casino for the demotion by defecting even more or altogether. Some patrons are very clever about “gaming the system” of casino marketing programs. If the patron’s play does not return to what got them the “carrot” in the first place, and their behavior doesn’t change after they’ve been warned with the imminent loss of that carrot, then the additional incentive should be removed. Again, CSI can be a helpful tool to track this both for individuals and for the cohort that gets demoted. I’m unaware of any casino using CSI for this purpose, however.

    That being said, I would have preferred her to have compared/contrasted two real programs and how they succeeded/failed to help crystallize her points in my mind. However, time limitations may have made this impractical.

  2. The second noteworthy presentation was a workshop led by Adam Smithline (CEO of Opticity) and Laura Stensgar (Executive Marketing Director of Coeur d’Alene Casino Resort Hotel) on “How to use data to develop an integrated and profitable customer loyalty program”. During the workshop, Adam and Laura handed out a few spreadsheets to work through in groups of two and then discuss. The purpose of this data-driven exercise was to get casino marketers to focus on how to quickly identify what was working well or not at all, and to introduce the concept of experimental design, something we’ve been doing at DiamondStream for casinos since 2006. Their talk illustrated casino marketers’ broad range of philosophies and sophistication. For example, many casino marketers only look at Average Daily Theo (ADT), but others recognize that understanding the casino’s actual win can also yield valuable insights into a player’s value to the casino. At this late date, the fact that most casinos still do not have an integrated data platform that combines gaming and non-gaming patron data was astounding. In addition, no one at the conference had integrated data from outside their casino loyalty club into their database, such as patrons’ payments activity at other properties (this type of information is provided by DiamondStream’s CSI platform). Clearly, industry practice has not kept up with aspirations over the last decade to have a 360 degree view of a patron including their total worth to the casino. And, no one seemed satisfied with the technology choices available.
  3. The third interesting event was a workshop titled “How to leverage your player database with profitable sales strategies that will grow your revenues – Who ya gonna call?”, presented by Steve Bowne (President of Raving Service who runs the Player Development training function). Steve used a simple 2×2 construct to educate casino marketers on the most basic patron segmentation framework that casinos should start with. One axis is ADT, while the other is frequency in terms of number of days or trips to the casino per relevant time period. The general notion is that casinos should invest more (time and offers) in low frequency but high ADT patrons:

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    This makes sense if no other information is available; however, CSI and maybe other data sets can provide critical information to determine the incremental gaming potential value that a patron could represent to your casino.  Also, this method entirely misses the patron’s non-gaming value to the property, as well as the value of the friends who accompany him.  A more sophisticated patron segmentation would take into account this concept of incremental gaming value to the casino (based on external data sources such as those provided by CSI), and the patron’s ‘buddy’ potential – their ability to influence others to visit the casino.  Still, what Steve presented was a great starting point: it was easy to follow, easily actionable and hence was very valuable to many.

Overall, the conference provided a great opportunity to see some great presentations and meet with a couple of dozen exhibitors.  However, as alluded to above, great opportunities still exist for casinos to apply more sophisticated, targeted strategies to improving the customer experience at all stages of the customer lifecycle.  As data continues to proliferate and drive the top and bottom line in many verticals, it will become increasingly important for the gaming world to embrace the new wave of thought leadership and technologies required to extract maximum value from the insights it can reveal.  At DiamondStream, we are committed to helping casinos make that leap through strategic partnerships, targeted products, and custom services engagements.  We invite you to explore our website to learn more about what we offer, and to reach out to learn more about how we can help your casino win in the new data-driven arms race.