There is a lot of competition
for the gaming consumer.
New markets and new properties
are opening around the
world. Consumers have a
wide range of leisure options
to consider. New channels
and distribution players are
entering the market, while existing players
increase their reach and penetration. Every one of
these competitors is after your patrons.
Savvy marketers know that consumers are looking
for value when they seek out leisure experiences,
and in today’s increasingly interconnected
and transparent world, they have endless sources of
information, from you and from their fellow travelers,
to assess what their experience will be like.
You need to be able to demonstrate that they can
find exactly what they are looking for with your
property and service and no one else’s!
To accomplish this, the patron must be at the
center of marketing efforts. How you communicate
with your patrons should be driven by what
you know about their interests, needs and preferences,
not what the organization has decided
should be promoted. Patron-centric marketing
means building a complete picture of patrons’
activities and interactions, and using that information
to identify, target and nurture the most valuable
patrons.
Figure out who they are: Build a
360-degree view of the patron
The 360-degree view of the patron is not a new
concept. Casino marketers have been talking
about this for years. The investments casino
resorts have made in non-gaming offerings like
restaurants, spa and retail are driving patron
behavior, and contributing to patron value. It is
crucial to understand how patrons spend across the
enterprise to get that complete picture of who they
are and how valuable they are to you.
The real 360-degree view is not limited by the
four walls of the establishment, and it doesn’t end
when the patron leaves the property. In today’s
hyper-connected, digital world, patrons interact
through websites, social media channels and
mobile apps before, during and after their visit. It
is now possible to track online behavior (including
mobile devices) and append that to the offline
patron profile. Knowing what they looked at, not
just what they actually bought can help with
cross-sell and upsell strategies as well as targeted
marketing efforts. Understanding how patrons are
connected to each other can also contribute to
understanding their value. Some companies, particularly
in retail, are using iBeacons or other location
tracking devices to collect traffic patterns and
to push offers to mobile devices while they are
moving past or through their location.
Obtaining a 360-degree view requires a combination
of technology investment and business
process change. Any system that a patron touches
must to be set up to identify the patron and track
the transaction or interaction back to their profile
(anonymous or known). Many casinos are challenged
by disparate selling systems or third parties
that are not obligated to share data. Setting up the
technology infrastructure is challenging enough,
but even if you can integrate all these disparate systems,
they may not be speaking the same language
– or collecting data in the same format. Business
processes must be set in place to ensure consistency
and accuracy in patron profile information.
Patrons may need to be encouraged to identify
themselves at every transaction. Additional information
might need to be gathered when patrons
are signing up for loyalty cards or checking in at
the front desk. In most cases, casinos will need to
rethink their loyalty programs, adding or adjusting
incentives to encourage patrons to identify
themselves and provide required information.
After all, what else is a loyalty program but a way
to “buy” patron data?
The success of any patron data collection project
has generally more to do with the business process,
or governance, placed around the data that is collected,
than the amount or type of data. There are
several recommended best practices when embarking
on a patron data collection project:
1. Define the information that will be collected
about patrons. Review all source systems
and understand what data is collected, and at what
level of detail. Understand what is available right
now, and what requires a business process or technology
change to collect. Review any regulatory
issues that might be associated with certain types
of data. Determine a common definition of key
fields or key metrics among everyone who might
be using the data.
2. Define how this information will be
used. Every element collected in the guest
portfolio should have a purpose. Just because
you CAN capture a data source doesn’t mean
you SHOULD or that you need to. Be disciplined
in defining what you would do with
every piece of information. If you don’t need itor can’t really use it, then you don’t need to go
through the effort of collecting it.
3. Agree on a process for updating or
adding new information. The long-term sustainability
of the patron database depends on
well-defined processes for updating or adding new
patron information. For each piece of data, define
the system of record and how it relates to the rest
of the data sources. For new data, develop a
process to carefully evaluate it to answer key questions
like how it relates to what is already in the
database, how often it is collected/updated, how
reliable it is and how it will be used in analyses.
Following this process will not only ensure
that you will maintain a clean and credible
360-degree patron view moving forward, but
also that you have a process in place to manage
any data concerns that come up such as
privacy or security issues.
Keep in mind that it is not necessary to
have the “perfect” patron database to start on
patron-centric marketing efforts. Using what
you have now while planning what you can
get in the future is a really good way to drive
value (and attention) in the short term and to
inspire innovative thinking for the future.
Put the patron at the center:
Identify and target your most
valuable customers
Creating that 360-degree view is only the first
step. Without advanced predictive analytics,
you are operating on guesswork gleaned from
historical snapshots. While you might be able
to identify your most valuable patrons right
now based on historical data, without
advanced predictive analytics you will not be
able to identify an “unknown” patron with
high value potential, or predict when a patron
is about to defect and know the right intervention
that will keep them coming back.
Using techniques like advanced segmentation,
data mining for behavioral patterns, acquisition
and retention modeling, and customer lifetime
value calculations, you can not only identify your
most valuable patrons, but derive insight into
what drives that value. Segmentation helps to
identify profiles of like patrons from the existing
database to help you match an “unknown” patron
to a group of like patrons, making sure you don’t
miss out on the opportunity for a valuable new
acquisition. Customer lifetime value calculations
identify who is valuable to you now, but also how
their value is likely to change over time. Analysis
of previous response rates can help predict who is
most likely to respond to a particular promotion,
and forecast what the response rate will be overall.
When Caesars Entertainment (formerly Harrah’s)
designed the Total Rewards Program, they used
analytics to discover that their most valuable
patron segments were not the high-rollers that visited
the casino a couple of times a year, but rather
the frequent slot players whose bets were smaller,
but visit-frequency significantly greater. This
insight changed their whole service proposition,
leading them to value frequency as well as spend.
By putting these patrons in the center of marketing
efforts, they were able to identify the “perks”
that mattered to these high-value patrons,
like shorter lines and access to nicer facilities or
services. This treatment encouraged high-potential
patrons to switch their loyalty to Caesars. This
analytically driven mindset changed the game for
Caesars (for more on this see Competing on
Analytics – The New Science of Winning by
Tom Davenport and Jeanne Harris).
An important point to take from the Caesars
experience is that analytics can support your creative
efforts, but certainly not replace them. Once
you have the information, it’s what you do with it
that counts. To understand whether your patroncentric
marketing is hitting the mark, it is important
that analytics are leveraged at every phase of
the marketing process from design through execution
to post-campaign evaluation. Combining
what you know about your patrons with how your
marketing efforts are performing over time will
identify what is working and what isn’t, and most
importantly, help you survive and thrive in a highly
competitive environment.
Kelly A. McGuire, PhD leads the Hospitality
and Travel Global Practice for SAS. In this role,
she is responsible for driving the offering set and
setting strategic direction for the practice.
McGuire works with product management,
sales, alliances and R&D to ensure that SAS
solutions meet the needs of the market, and
evangelizes the value of advanced analytics to the
industries she serves. Before joining SAS,
McGuire consulted with Harrah’s
Entertainment on restaurant revenue management
strategies for their major markets. Prior to
that, she was a senior consultant at Radiant
Systems. She also worked for RMS (Restaurant
Revenue Management Solutions) providing
menu item pricing recommendations to major
chain restaurants. She is also a frequent contributor
to industry publications, speaker at industry
conferences and is co-author of the SAS/CHR
blog “The Analytic Hospitality Executive”. You
can reach Kelly at Kelly.McGuire@sas.com.