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Young Players: The Future is Now

Live events, social media strategies lead the way to connect to a new generation of players

Young Players: The Future is Now

While traditional images of casinos often depict middle-aged adults and senior citizens spending countless hours at slot machines, buffets and shows, this stereotype is becoming quickly outdated as Generation X and Generation Y have casinos competing for future loyalty from this in-demand demographic.

Casinos and hotel properties have been adjusting to this new demographic in recent years, moving away from standard marketing outreach that focuses solely on gambling and transitioning to showcase retail, dining and entertainment options.

“For the younger demographic, casinos are not just worried about how much they gamble,” says Dan Fetters, SAS account executive for the casino and gaming market. “It is about what their future looks like and their influence on their peers. How often they stay, who stays with them and what they do when they stay at the property are the important questions now.”

Along with new ways to identify what keeps the younger demographic returning to casino resort properties, the industry has had to change how it communicates with its clientele, as operators hope to build a long-lasting relationship beginning in young adulthood.

“The main difference we see is a shift in the way younger audiences consume information,” says Eric Petersen, director of new media for Caesars Entertainment. “These customers are watching YouTube videos, reading blogs, checking out pictures on Instagram and following their favorite brands and celebrities on Facebook and Twitter. While traditional media channels are still important to us, we are focusing our mix towards digital channels to engage our younger guests and to ensure we hit the right media mix to attract all of our customers.”

Today’s young casino customers are facing economic struggles not seen in over 50 years, but most experts believe that condition is irrelevant to the low priority this generation places on gambling.

“This younger demographic has never had any meaningful disposable income to excite casinos,” says Michael Meczka, a recognized industry leader in gaming marketing, research and consulting support. “The state of the economy is not the issue; the issue is that this segment has little left for gambling, and gambling is not a priority. Casinos are promoting their non-gambling amenities, retail, restaurants, entertainment, nightclubs, pools and daytime parties, with the hope of creating an awareness of all the casino games to develop a trial and repeat experience in the casino.”

The Skill of Being Social

The influence of social media to the younger market is infinite, supplementing the standard U.S. Post Office mail distribution of promotional offers and rates to loyal customers. All major casino properties now feature e-commerce and social media personnel who influence promotional offerings and provide real-time feedback from the guest experience. Combined with the current analytics available on customers, outreach efforts to customers of all ages are becoming more dynamic.

“It is often difficult to get casino social media and data analytics to work together, but when it is done right it can be very effective,” says Fetters. “The most effective campaigns measure their promotional offerings, then compare them to their competitors.”

Fetters says he is surprised that a single overall strategy to reach out to loyal customers with marketing, e-commerce, social media and mobile communication vehicles has yet to be defined for most major casino properties. The Palms Casino Resort has worked on unifying its strategy, while still offering segmented and dynamic offers to each specific customer. The  Palms uses social media for customer engagement and customer service.

“Cross-channel marketing is very important to reaching the right customer at the right time,” says Erin Levzow, director of e-commerce at the Palms. “Whether we want to reach you on your smart phone, tablet, laptop, desktop computer or touch-screen display, we will be able to connect the conversations between each device.

“It is a struggle to get the younger crowd involved with advertisements outside of social media,” she says. “So we make sure we provide the most relevant and interesting information for our fans and followers across social media platforms.”

How casino properties communicate and respond using social media varies nearly as much as the casinos themselves. Some properties create a designated social media spokesperson who responds immediately to any and all social media requests received from Facebook or Twitter. Others have a group of responders who perform this function. The majority of these requests deal with dining, entertainment and retail topics.

“Casinos have tried to make this as user-friendly as possible because they always have an offer associated with the social media promotion,” says Meczka. “Access via social media does mean there will be more money for casino play.”

Meczka insists that despite its popularity, many casino social media teams are operating with “little direction or meaningful strategy.” He fears that in the next couple of years casinos will continue to add personnel to the social media department with no real accountability or performance measurements.

“Casinos are training these younger social media users to respond only when incentives with offers and discounts are disproportionate to their casino value,” says Meczka. “Social media has not been embraced by the older, more valuable casino demographic which has disposable time and income. This may change as the younger demographic ages, but to become more valuable to casinos, this younger segment will have to demonstrate a greater learned propensity to gamble in casinos with increased frequency. This probably will not happen.”  

Facing the Future

Not surprisingly, Caesars Entertainment has a more positive and optimistic view about its social media outreach, converting fans into members of its Total Rewards loyalty program. They have added hash tags to television commercials, pulled live Twitter feeds into digital signage, and hosted Google+ hangouts with today’s most popular entertainers.

“The way for us to improve and continue to be a leader in the gaming space is to listen to what our loyal customers and new customers are saying about us, and we think social media is the way to do it,” says Petersen. “We see Facebook as the communication and engagement hub for each of our resorts to share pictures, articles, videos, special offerings and grand openings. We plan to continue to grow our audiences on Facebook, Twitter and YouTube and to lead the market in audience sizes.”

In May, Caesars used Facebook to give away 1,000 VIP wristbands to lucky customers, giving them priority entry to the new Horseshoe Casino in Cleveland. The operator hosts live Facebook chats that feature executives, entertainers and celebrities. Caesars has established even more connections with loyal guests with an Instagram picture gallery that allows guests to post their photos from the property onto the page.

Caesars uses Twitter to quickly distribute content to its followers, and also uses the platform to cover events live, including Celine Dion’s opening concert at Caesars Palace Colosseum, giving fans an opportunity to follow along as she performed new songs.

“We see this tactic as a way to drive buzz and interest, which ultimately drives increased ticket sales,” says Petersen.

The other preferred method of communication among young adults is text messaging, and casino properties are beginning to utilize this tactic as well. Although the frequency of use between properties varies, and some have not started using text messaging at all, all properties and industry experts alike agree it will be a major stand-alone tactic in the near future.

“Casino VIPs like the personalized service of their casino host, and some hosts use text messaging as a last-minute communication device,” says Meczka. “Texting may be used at an increasing rate if VIPs request this from their casino hosts. VIP communication programs featuring text messaging must have an opt-in feature and must be personalized to minimize electronic clutter and get the message to the intended recipient.”

Caesars Entertainment has already implemented an SMS (Short Message Service) program, where customers can opt-in to receive offers throughout their stay, at its resorts across the country. Marketers have also found text messaging a very effective method of communication with players by their casino hosts.

Although it has not completed total implementation of its text messaging strategy, the Palms Resort Casino is eagerly anticipating using this tactic in the future.

“We definitely plan on using text messaging to communicate with our customers, because it is a quick and easy way to let them know what is going on,” says Robin Phelan, interactive marketing manager at the Palms. “Whether it is a last-minute promotion or openings at the poker table or slot tournaments, we want our valued customers to receive that information first and feel important.”

Promoting to the New Player

According to the research of Meczka’s consulting firm, the younger demographic visits casinos at an 18 percent incidence rate while the older demographic visits casinos at a 38 percent incidence rate. Because of this tendency, properties have been forced to take a hard look at how they can attract this demographic not only for today, but for years to come.

Those in the younger demographic are attracted to four elements that casino properties offer: live attractions, retail, dining and entertainment. With the casino gaming and entertainment experience being more accessible in every region throughout the country, the main U.S. gaming hubs of Atlantic City and Las Vegas have been forced to up the ante in attractions and entertainment.

“There is success in attracting a younger, price value-oriented, coupon-clipping, deal-chasing demographic to fill the casino, buffet or show at the last minute,” says Meczka. “But to attract a younger demographic into the casino who brings demonstrated trackable gaming value, those efforts have had little success.”

The Palms has done a good job bringing the gaming environment to the younger demographic by offering blackjack tables at its pool, a very popular and lucrative decision from day one. With the increased popularity of variety in slot machines among the young demographic, the Palms also makes it a point to acquire the newest releases that other properties do not have.

Caesars Entertainment is investing a lot of its future plans to begin a long-term engagement with this demographic through its entertainment and facilities. The Total Escape promotion on March 1 used social media to have music superstars Mariah Carey, Sean “Diddy” Combs and Maroon 5 announce surprise concerts and free tickets. Sugarland, Nicki Minaj and CeeLo Green are all headlining acts Caesars Entertainment has hosted at properties across the country targeted to the younger demographic.

“Progressive casinos are now trying to measure their services and experiences as a brand,” says Fetters.

Caesars Entertainment is building a new experience with the LINQ, a $550 million retail, dining, entertainment and hospitality district along Las Vegas Boulevard between Flamingo Las Vegas and Imperial Palace Casino. The LINQ is to be a destination for all ages, but many elements will speak directly to the highly coveted young demographic so they can build a bond with the LINQ for years to come.

“We are going to have the programming and tenants to develop an environment conducive to Generation X and Generation Y,” says Jon Gray, vice president and general manager of the LINQ, who has earned a stellar reputation in Las Vegas for marketing to the demographic during his time with the Palms.

“It will be a very unique, energetic space that will have something for everyone, but will give Generation X and Generation Y consumers more opportunities to gain and use Total Rewards points,” Gray says of the LINQ, scheduled to open in December 2013. “The younger consumer is very reliant on what their friends and peers tell them is cool, so we have to get in with the taste-makers and thought-leaders. Programming is essential, and it cannot be faked or forced.”

Some gaming analysts are predicting that the Generation X and Generation Y clientele, ages 21 to 46, will grow to 52 percent of Las Vegas visitor spending by 2015.

“We want to create a more approachable environment,” says Gray. “This has not been done before on the Strip, and we want people to feel welcomed, whether they are partying with friends or being romantic with that special someone. We are creating an energy you will not want to miss.”

A Dynamic Demographic

The attention being paid to the younger demographic has shifted dramatically in the past five years. Traditional industry experts like Meczka still believe that currently the real value is in the older demographics, who have more stable incomes and are much more likely to gamble.

“Hopefully, casinos will stop marketing to this lowest-value segment once they do the analytics to determine the scant value of young gamers,” says Meczka. “Not to mention the displacement of older demographics with much greater casino value.”

The new-school way to judge consumer value will continue to eat away at traditional viewpoints.

“Social media analysis is going to continue to define the influence of those people while they are at the casino,” says Fetters. “While you have them on the property you have to capitalize and respond to what they are saying to enhance their influence.”

Casinos will continue to pay more attention to total spend by the younger demographic, including hotel, dining and shows.

“The emergence of digital and social media channels will value customers differently and treat them in a real-time fashion,” says Fetters. “There is an exciting synergy between real-time marketing and customer analysis. There is a lot more data out there and it is exciting to see what casinos do to capitalize on these opportunities.”