Legacy Casino Systems Impede Innovation

Hurdles to even simple e-commerce strategies illustrate the need for better casino data and personalization.

Let’s face it: Casinos are stuck in a pigeonhole of legacy technology that doesn’t address the evolving gaming landscape. Back-of-house technology built decades ago with limited and costly connectivity holds properties back from the most basic e-commerce capabilities, particularly personalization.

How did this happen? Outside of the large international companies that are developing and building their own technology, the casino industry hasn’t experienced the kind of back-of-house innovation it desperately needs.

Smaller, independent casinos are hamstrung by budgets, putting them behind the 8-ball when it comes to adopting automated and analytics-driven technology. Consequently, tech developers are often wary of operating in a space where shallow pockets could mean less adoption.

The casino industry was groundbreaking in its approach to building guest profiles and then developing a relationship with those guests through marketing. Early on, the model was much easier to implement at casinos than at hotels because of the high amount of return visits.

Casino data management that was revolutionary 20 years ago has changed very little since.

At the center of the issue is the patron management system, often built by vendors rooted in slot machine development. While these are incredibly innovative companies, most of their focus is on improving the gaming experience and tracking machine revenue and less often on improving casino-wide data management.

In addition, much of this legacy technology comes with massive integration costs, hindering a casino’s ability to deploy a more agile strategy.

And when on-property technology and databases are siloed, most likely operations are as well.

 

Improve the Online Experience With a Holistic Approach

To take the next step, basic casino marketing concepts should remain in place, but cloud technology, centralized data and automation have paved the way for quicker and more profitable e-commerce strategies that provide better value to the guest.

Start by understanding that along with technology upgrades should come operational culture changes. Breaking down the barriers between branches, particularly hotel and casino sales and marketing departments, is a must.

Take a close look at whether your employees at the corporate and property level are set up in the best possible situations to succeed. Opening up communication across departments and sharing data will allow everyone to act in alignment, which will ultimately pave the way for a seamless customer experience.

Once the casino’s departments are collaborating, they can begin to properly value their guests, which is the crucial first step to bringing real personalization to the casino industry.

Instead of valuing guests based solely on gaming spend, casinos need to quickly adopt a total-profitability perspective. Valuing guests based on their total spend—including gaming, hotel, restaurant, spa, etc.—provides a much better understanding of who to comp, who to discount and who to charge the rack rate. The process can be extended to groups, and now casinos can better determine the profitability of taking a group that may or may not gamble versus a full house of comped gamers.

The marketing team should be meeting much more frequently than monthly, as they typically do to pull all the player values and then send pieces of mail. Casinos should also cultivate an understanding that players can call anytime and get a quote.

 

Proper Values Lead to Better Personalization

Properly valuing your guests gives casinos a better ability to customize merchandising along the booking path, such as offering the most appealing room type or packaged upgrades in the right sort order. Rewarding guests at different points of the customer journey with rates or offers that reflect their value to the property will help grow your casino’s base of repeat guests.

Showing your players they can get a personalized rate whenever they want helps your operation in multiple ways:

  • It smooths out your booking window so your call center is not overwhelmed for a few days every month.
  • It paves the way for guests to earn value at one property and redeem rewards at another.
  • It entices higher levels of play due to a real-time reward system.
  • It opens up new ways for cross-property marketing that contribute significantly to growth.

Once the culture and strategy are in place, pressure your technology partners to bring this process out of the call center and online. This will require more collaboration and integration among your various tech partners, bringing guest data out of a closed warehouse and into a centralized platform where it can be accessed in real time and used to make data-driven marketing and e-commerce decisions.

With as few clicks as possible on a casino’s website, loyalty members should be able to sign in, and a personalized room rate should be served up immediately. Speeding up the time it takes for your loyal guests to get their comp or special casino rate likely means more of them will book with your property, and at prices that will increase the casino’s profitability.

There is more customer data available than ever, meaning casinos are better equipped to offer personalized room rates and tailored packages or upgrades. Individualized rates help casinos appeal to gamers and non-gamers alike, ultimately driving conversion into profitable bookings.

Marco Benvenuti, a principal with Duetto Consulting, has extensive experience in revenue management, business analytics and IT. In June 2008, Benvenuti founded and managed the Enterprise Strategy department at Wynn and Encore in Las Vegas. He oversaw revenue management, data analytics, direct marketing and the online channels. Prior to his tenure at Wynn Las Vegas, Benvenuti was part of the Business Strategy department at Caesars Entertainment (formerly Harrah’s Entertainment), where he built the business intelligence platform for revenue management decisions that is still in use today. Benvenuti has patented two unique inventions: the pricing engine for one-to-one dynamic pricing (sole inventor) and the enterprise value algorithm for calculating the value of every customer (co-inventor).