Sudhir Kale, GamePlan Consultants

Casinos have traditionally collected considerable data on their customers, particularly on those belonging to players’ clubs. However, analysis and integration of data have always been bottlenecks in moving from a “build it and they will come” orientation to “understand them and they will come more often” orientation. Indeed, around a decade after Harrah’s Entertainment demonstrated beyond doubt what judicious use of player information can do for a casino’s bottom line, very few casinos have successfully emulated Harrah’s in using information as a key element in its marketing arsenal. Sure, you will find a lot of companies claiming to practice Customer Relationship Management (CRM), but CRM for most casinos is little more than installing a data warehouse and being able to process queries faster.

The reason for this grossly suboptimal application of CRM is the way management views the Customer Relationship Management initiative. For most C-level casino executives, CRM is still viewed as a technology solution comprising of operational data stores, data marts, and data warehouses. Very little thought is given on how best to convert the enormous quantities of data into customer information and customer knowledge. Data become information only when associated with a particular customer or a group of customers. Information when harnessed to make astute marketing decisions becomes customer knowledge. Turning data into customer knowledge requires knowledge of experimental design and multivariate statistics which few employees within the casino industry can claim to have. In absence of this expertise, CRM is relegated to extremely simplistic campaign management queries using highly sophisticated and powerful computing and storage devices.

If knowledge of statistics and predictive analytics is one barrier to effective CRM, lack of an overarching organizationwide application of CRM is another, bigger barrier. In most companies, decisions about CRM-related technology are made before the organization has been readied for CRM implementation. Critical changes in the organization structure, processes, reward systems, and performance metrics should be in place before any technology decisions are made. Most casino executives do not display the patience to hold off on CRM software and hardware till the culture, the structure, and the processes within the organization have been adequately modified. In absence of such groundwork, commitment to CRM remains ad hoc, sporadic and partial. The use of powerful CRM weaponry remains confined to the most primitive and low-traction campaign management initiatives.

The right starting point for CRM practice is leadership. Casino top brass need to be passionate about customer centrism and be excited about the immense possibilities inherent in leveraging customer knowledge to deliver an experience that not only meets customer’ preferences but is also strongly aligned with the company’s overall business and brand strategy.

Top management then needs to ensure that the promised experience is, in fact, delivered by the service personnel consistently, regardless of touch point, day after day. Creating and maintaining this consistency involves major organizational changes. To facilitate the sharing of customer information and the seamlessness of customer experience, some companies have restructured their organization around customer segments while others have chosen to retain their existing structure and carved out “holes” in the walls between divisions, properties, and business units. Regardless of the specific means of coordination, effective CRM implementation rests on the realization that the function of marketing transcends the marketing department and spans the entire enterprise.

Unwavering market orientation also needs to be reflected in the company’s reward systems such that customer-oriented employee actions and practices are encouraged and reinforced. If CRM is to achieve its true potential, the initiative’s buy-in on the part of every employee is required. People at each level within the organization need to appreciate the goals, objectives, and mechanics of CRM. More importantly, they need a solid awareness of what CRM means for themselves, their co-workers, and their customers. Creating this pivotal change in the mind-set of employees requires evangelical zeal for CRM on the part of top management. It is the commitment of top management to superior customer relationship capabilities that separates leading CRM practitioners from other contenders and pretenders.

Conclusion

Optimal use of customer information is not possible without an organizationwide relentless focus on the customer. Barriers to information-centric casino marketing stem from two deficiencies: deficiency in statistical expertise and deficiency in top-management commitment. Customer relationship management is a philosophy, a strategy, and a commitment to simultaneously boost customer satisfaction and shareholder value by providing consistent, seamless, high-quality experiences to the casino’s chosen customers. Technology, in absence of organizationwide commitment to the customer, will invariably prove impotent in delivering the gains CRM promises.

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Date Posted: 18-Oct-2007

Sudhir H. Kale, Ph.D., is Professor of Marketing and Co-Director of the Centre for Globalization and Development at Bond University. He has published over fifty articles on various aspects of casino management and marketing. Sudhir is the founder of GamePlan Consultants, a company that consults and trains on the marketing and customer service aspects of casino management. GamePlan Consultants’ clients span five continents and represent some of the world’s largest gaming companies. For exploring ways in which you can benefit from Sudhir’s expertise, you can write to him at skale@gameplanconsultants.net.