Category Archives: Managing PD

7 Ways to Blow Up Casino Marketing

As we move out of a paper world and into a digital world, you are reviewing your entire approach to Casino Marketing.

You’re not?

Do you go home, throw away the physical mail, and look at your phone all evening? Of course you do. And that is why we have to review our entire approach.

Our industry needs to move away from the mass distribution of glossy pieces. And I am not talking about switching from direct physical mail to direct email. I am suggesting that we turn everything on it’s head.

First, let’s get on the same page re: what happens today.

When we pour money into billboards, radio ads, and sponsoring local events, we are doing  Saturation marketing. We hope to catch the attention of everyone in those zip codes but of course, not everyone is going to care AND we cannot measure the response.

If I ruled the world, I would leave a two billboards on the Interstate to catch the passers-by who need a rest-stop, and invest 90% of the rest into targeted ads on Facebook. Your casino is in a fixed spot and does not move around. So you can use targeted ads on Facebook to promote your property, amenities, and events to the right demographics in the right locations. Instead of relying on someone looking at the mailer to see your Double Down Tuesday, run an online ad on Monday and Tuesday.

And the missing 10%? You know how you look at picture of some shoes, and then an ad for those shows follows you around as you go to other websites? Imagine investing in that technology so if someone clicks on your Steakhouse, then your restaurant follows them around as they look for alternatives.

When we pump out a physical mail piece (your Monthly Mailer) we are doing Targeted Marketing. We are sending  30,000+ glossy mailers to a segmented list using worth, market, demographic, recency. Yes, we are helping the United States Post Office but 55% of our mailers end up in the same place as the offer for a new credit card. There is a lot of talk about how to attract millennials into our Casinos but using physical mail is a real turn-off because that demographic don’t like to see waste. (Pechanga is getting some great publicity for donating their half-used toilet rolls!)

BTW, direct email is not the answer to direct print because, let’s face it, you don’t read those either, do you?

If I ruled the world, I would only send a postcard, on recycled paper, with the dollar amount of their offers in large print. And it would look exactly the same every month but on a different colored card. People will keep this because it looks like money and because they have the excuse to go to the casino and ‘not waste it’.

Think about how upset we get when it is revealed that a charity gives 5% of our money to the children in need, and burns through 95% on advertising, marketing, and staff. Take a hard look at your Marketing budget. What % ends up with the guest in their offer, and what % is used for ‘communication’? How could you shift some money over into the actual offer and upset your competition?

Your multi-million dollar investments in Advertising and Direct Mail, buys you a very large, slow moving, fishing boat using large nets to try to catch fish; both large and very small.

By comparison, your somewhat meager investment of 500K in Player Development, is like fly-fishing with a rod. If they take a Strategic Approach, your PD team will watch, target, and pick off the big fish.

Having a PD team is based on the premise that the highest worth gamers deserve personal attention and 1:1 marketing techniques.

But!

We don’t give the PD team the tools and the budget to do 1:1 marketing. We expect them to use their cell phone, and waste time at the laser printer with form letters.

Ideally, the PD team would have a CRM, (so they can segment their players) that is hooked up to your vendor for print and email. Or hooked up to a vendor so the coded player automatically receives a personalized birthday gift from their Host, or a box of cookies at Thanksgiving. All handled automatically… with a text to the Host that let’s them know the gift has been delivered, so they can call and bask in the glory.

I suggest you consider asking someone on the Direct Marketing team to take a look at the coded players and come up with segmentation, with business rules for ‘when to send what kind of gift to which kind of player’, and burn some dollars on those best players.

Many of you are building very large Player Development teams, with as many as 20 Hosts, in an effort to go deeper into the Club and build a relationship with more players. I think that’s great! But invest in an approach, and some tools, in addition to adding bodies.

And, to truly go ‘deeper into the Club’, you have to go deeper into the phone. Everyone is carrying a phone. It is now a fact and not  a question. So how do you use the phone to attract, track, motivate, and retain, your customers?

This is why I was so excited to read about the Mobile Experience & Engagement Training (MEET) Day that has been added to the Casino Marketing & Technology Conference.  Take a look at these topics around using the phone to improve the casino player, guest and employee experience.

In conclusion!

  1. Take a hard look at your Marketing budget. Don’t be that greedy charity that burns 95%!
  2. Keep two billboards on the Interstate that emphasize your good food and clean restrooms.
  3. Move your advertising budget into Facebook, Snapchat, Instagram, Youtube, and techniques that follow the surfer around after they have clicked on you.
  4. Dump the expensive physical mailer in favor of a simple (recycled) postcard that has a $ amount in large letters.
  5. Treat your coded players as a ‘database inside a database’ and give some direct marketing tools to your PD team.
  6. Go deeper into the phone. Everyone’s attention is on their phone, and you want to be literally ‘in their face’. Attend MEET in July.
  7. Drink the kool-aid about getting attention by watching Gary Vaynerchuk.  Here’s an intro to Gary Vee. . Put up with the profanity and listen to the end.

Finally, be brave. Be audacious.

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And if you enjoyed this, then take a look at How Do We Transform the Gaming Industry, Gary Vee?

How do we transform the Gaming Industry, Gary Vee?

Jmovies2

Jimmy Compton, PD at 7 Clans, started a conversation in the Player Development Association about millennials and what will attract them to Casinos…

…I reluctantly went to the Cinema last night (Book Club) for the first time in 5+ years.

Why reluctant? I hate having to get there early to be sure of a good seat alongside my friends, and to avoid being stuck between strangers. I don’t want to drink a soda in the evening, I want a glass of wine. And I hate having to scrunch into my seat to let people go by.

I’d rather sit at home and obsessively watch Gary Vee videos on YouTube with a glass of Tempranillo. (More of Gary Vee later…)

What a surprise! My friend had purchased our tickets on-line and we had assigned seats. There was a bar in the foyer! And my seat was as comfy as a first-class airline seat, and even reclined. If you are thinking ‘of course’ then you can appreciate how long it has been since I went.

After the movie, I started to relate this experience back to Jimmy’s questions and to our Casino industry…

The Cinema of my youth had lines around the block and could cram the audience into small seats, narrow rows, and a large auditorium showing one movie. ‘Going to the Movies’ was THE exciting outing, and the Cinema did not have to compete with other forms of entertainment; in fact it closed down a lot of live entertainment.

Now we have so much choice of entertainment and even from the comfort of our own home. So why go out at all, and why pick the cinema? Why go out, and why pick the casino?

I was impressed how the cinema has been re-envisaged and transformed. Smaller auditoriums, multiple choice of movies, comfortable seats, alcohol, and assigned seats.

How are we going to re-envisage the casino experience? I don’t mean add more amenities and provide free wifi. How will we transform the casino experience?

How do we capitalize on Gamers that will go online and book a time-slot in an amazing 3D technology experience with their friends, and pay for additional virtual experiences while they play? Isn’t the Casino the natural venue for all kinds of amazing 3D and VR technology that is too big for my front room?

Where are the fun robots that roam the floor and you can interact with them? Not to replace the staff – but to add some buzz!

How do we tie into the anticipation of the new Marvel film and not wait for a themed slot machine emerges? A millennial will not be excited about a Marvel slot machine. But they might have come to an event with costumed actors who will pose for photos, while you play the free trailers on big screens. Perhaps you install a small but amazing auditorium and groups can rent the space?

I went to see the Book Club which is aimed at the 50+ female market that maps really well to the demographic of a slot player. How do we get small groups of women to come to the Casino and re-live the movie in a VIP event? Set up an area with video clips playing from the Movie and serve wine and Tapas?

It’s not just about millennials. Why did I go to the Book Club? Because of video clips on Facebook that were targeted at me based on my gender and age. Everyone is on social media, and staring at their phone.

Which leads me to Direct Mail; I know that you go home, throw away your physical mail, and then pick up your phone. Part of this transformation of our industry will be to abandon the postage stamp, and throw ourselves fully into Facebook, Snapchat, Instagram, Youtube, and whatever comes next. Is your casino doing that? I don’t mean dabbling in social media, I mean throwing away the postage stamp, and going 100% into social media.

And if Player Development is supposed to be a 1:1 relationship with the guest then social media is even more important! But do you have handcuffs on how much you can use Instagram and Snapchat as an Executive Host?

(Someone should please invite Gary Vaynerchuk to speak at G2E! Gary Vee is making his fortune explaining to industries like ours that we are completely missing the boat on social media. Here’s an intro. Put up with the profanity and listen to the end.)

And how was the Book Club? It was good but it failed to take full advantage of some amazing actors.

And will I go back to the Cinema? Absolutely!

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You can join the Casino Player Development Association (C-PDA) via Linked In. Connect with me and I will invite you.

The Importance of Pace

It is important to provide a daily Pace report for each goal, so the Hosts can monitor their performance and adjust their tactics before it is too late.

To create a Pace report, we figure out three things:

(1) What is the percentage of the Goal? If the coded players for this Host have made 2,505 trips and the goal is 5,010 trips, then the Host is at 2505/5010 = 50%.

(2) What is the percentage of the quarter? If we are in Q2 then there are a total of 91 days from April 1st through June 30th. If yesterday was April 16th, the 16th day of Q2, then we are at 16/91 = 18% of the quarter.

(3) Finally, we compare the two percentages to determine if the Host is Ahead, On Goal, or Behind. If the Host already has 50% of their trips and we are only at 18% of the quarter, then the Host is most definitely Ahead! Congratulations!

Here is an example of a Pace report for Beth, a Player Development Executive, for the first day of the second quarter. Even though we have only data for the first day of the quarter, we can tell Beth that she has started well, and she is Ahead of her goal.

You must drive 5,010 trips for the Quarter.
As of 4/1, you have generated 100 trips which is 2% of your goal. We are at 1% of the Quarter and so you are Ahead.

We have compared the percentage of the quarter (1/91 = 1%) with the percentage of the goal (100/5010 = 2%). After the first day, 1% of the quarter has passed by, but Beth has generated 2% of the necessary trips, so she is Ahead.

Here is an example of a Pace report for Beth after the 15th day of the quarter.

You must drive 5,010 trips for the Quarter. As of 4/15, you have generated 701 trips which is 14% of your goal. We are at 16% of the Quarter and so you are Behind.

Unfortunately, Beth has now fallen behind, but because we are only 15 days into the quarter, she has an early warning and has time to catch up.

Share this article with your Database Marketing team or vendor! No more waiting until the end of the Quarter to see where you stand.

Management Pace Reporting

In the same vein, the manager of the PD team needs a weekly Pace report for all Hosts, so they can schedule a coaching session and find out why the Host is falling behind.

Beth      Ahead    19%
Kenny     On Goal  16%
Kim       Behind   8%
Colleen   Behind   6%
Paul      Behind   5%
 
After reading this weekly Pace report, the manager of Player Development can meet with Kim, Colleen and Paul to find out why they are falling behind and dragging down the team.

The Strategic Manager pays close attention and ensures each Host stays Ahead or On Goal from the very beginning. Otherwise it becomes too difficult to achieve the goals, and some members of the Host Team will give up and wait for the new Quarter to start over.

 

Click here to read more Management Articles.

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Available at Amazon. $21

Read this book, Casino Host Goals, and you will have a road-map for success as you create or improve your Player Development program, in the context of your Casino Marketing strategy. It belongs on the shelf of any Executive in Casino Management who wants to drive revenue from a strategic approach to PD. Just $21 from Amazon.

SMART Goals – Specific, Measurable, Achievable, Relevant, Time-bound

Every time you write a goal, you need to take a step back and ask yourself is it SMART? Specific, Measurable, Achievable, Relevant, and Time-bound.

Let’s look at an example:  “In this Quarter, each Host will increase Theo from Active players by 7% over the same quarter last year.”

Is this SMART?

• It does Specify ‘Increase Theo from Active Players’
• The Measure is 7%.
• Is 7% Achievable? You can check by asking for a report that shows the total Theo for coded players in the last six quarters. If most of the coded players have been increasing their Theo at 5% even before you set Host Goals and influence Host behavior, then it probably is Achievable to grow by 7%.
• Each Host is responsible for growth from their own Active players which is Relevant to the company’s objective.
• The goal is Time-Bound and compares this quarter with the same quarter last year.

In conclusion, this goal is SMART but only IF, at your Property, you can measure the growth for each Active Player, and provide the Hosts with daily and weekly reports on which player to contact, and why.

In many Properties, the Hosts are not told their Goals, or given their coded lists, until a month into the quarter. And they are often not told where they stand against their Goals until after the end of the quarter when IT or the Database Analyst can run the numbers.

This approach is completely demoralizing because the Hosts have no idea whether their daily efforts are bringing them success. And from a Management perspective, the Hosts will meet their goals out of sheer luck and not because they focused their efforts on the right players so why pay out a bonus on a lottery?

The Player Development team needs targeted information each day to make the correct decisions on whom to contact. Without daily information, the team is not making conscious decisions on how to meet their goals, so why even have goals? It will be sheer luck and not inspiration or perspiration that enables the team to meet their goals.

So! Make your goals SMART and then be smart about providing the Player Development team with all of the training, coaching, and tools that they need to succeed and exceed with their goals!

 

Available at Amazon. $21

Read this book, Casino Host Goals, and you will have a road-map for success as you create or improve your Player Development program, in the context of your Casino Marketing strategy. It belongs on the shelf of any Executive in Casino Management who wants to drive revenue from a strategic approach to PD. Just $21 from Amazon.

Reference
Doran, G. T. (1981). “There’s a S.M.A.R.T. Way to Write Management’s Goals and Objectives”, Management Review, Vol. 70, Issue 11, pp. 35-36.

What is Your Annual Cycle? Gambling month by month…

When you write Casino Host Goals, they need to be SMART Goals (Specific, Measurable, Achievable, Relevant, Time-bound).

Let’s consider the word Achievable in the context of Seasonality. You need to do some research regarding what is realistic for each quarter for your Property. It is unlikely that each quarter is the same, and it is unlikely that your Player Development team can grow play by the same amount in every quarter of the year.

For most properties, there is a seasonal factor based on the weather patterns. If you are in the mid-western USA, then Q1 is lower than other Quarters because snow and ice in January-March will deter players from venturing out. If you are in Arizona or Florida, then Q1 might be higher because of snowbirds escaping to your warmer climes.

Q4 is often slow because your customers have so many other Holidays and family commitments that need their time, and money, to enjoy. If Q4 is always slow, then you should you have a lower growth goal for Q4 than for the other Quarters.

Take a look at this chart… the data reported by State Gaming Commissions from across the United States shows a clear cyclical annual patterns in play based on annual life events such as tax returns, paying for Christmas gifts, and taking vacations in the summer.

You can see the same pattern across the USA for three consecutive years. March is high, June is low, July and August are high, and the fourth Quarter is low.

This analysis was created by Harvest Trends and described in 2012 by Susan Kesel, a Gaming industry executive, in an article in Gaming & Leisure Magazine.

Does this pattern still apply to your Property? Are you having a great March? Get ready for April! Or do you have a different annual cycle?

If you talk to the CFO, they will know the annual cycle because the Finance Department has to manage the cash flow throughout the year and not be impacted by this fluctuation in revenues.

And take this into consideration as you set your Casino Host Goals! This is why many goals are written as growth over the same Quarter last  year, and not as growth over the Previous Quarter.

 

 

 

4 Steps to Strong Coaching from Managers

Here are 4 Steps to Strong Coaching from Managers.

  • Are you a Manager? Ask yourself ‘Do I take these Steps?’ and then file this away for when you need it.
  • Are a Host or Executive? If you are a real go-getter then you are hungry for this kind of feedback. Or, if you suspect that you are on ‘thin-ice’ with your manager, then suggest these steps to get their actual opinion of you, and to engage them in proactively coaching you.

This program takes you through the detailed steps of addressing and improving performance:

Step 1 – Prepare a Clear Assessment

  • Is there a written job description that details the expectations of the job?
  • Is there a standard Annual Evaluation Form for your Property?
  • Set aside 30 minutes of quiet time to reflect on the Host’s soft skills:
    • Read through the Job Description and the Evaluation Criteria
    • Give the Host a ‘grade’ of ABC for each part of the Job Description and the Evaluation Criteria.
      • A = ‘Really good at this’
      • B = ‘Okay at this’
      • C = ‘Not good enough at this’
  • For the C’s, write down 3 specific examples of where the Host went wrong.
  • Are their written goals such as ‘Increase Theo by 10% over last quarter?”
    • If so, review the Host’s results.
    • Reflect on your assessment of the Host’s soft skills.
      • How can the Host meet/exceed their goals by working on their B’s and C’s?
  • Prepare your summary! Map out a conversation that runs like this:
    1. Here are some areas that are really strong for you!
    2. These are some areas that need improvement.
    3. So we have talked about your strengths, and some areas that you need to improve, and I am here for you. Moving forward, how about we do X and Y each month.

Step 2 – Set up a Meeting but Don’t Terrify Them!

Schedule an hour with the Host.

Make sure your email gives them some homework to do ahead of time, so they can sit and reflect beforehand.

  • Subject “Discuss your Results”
  • Hi Jackie, Let’s spend some time going over your Job Description (attached) and discuss what you do well, and where you could improve. This is an informal conversation to see where I can give you some pointers on how to succeed. Please read the Job Description ahead of time and think about what you do really well (A), what you do adequately (B), and where you think you can improve (C). You won’t be giving me your own score but I want you to have thought ahead of time about what you see as your strengths and your areas for improvement. PS. Great job on the event last night. Thanks!

Try not to freak them out with your email! You don’t want them to lose productivity as they fret about the meeting.

Step 3 – Meet and follow the Sandwich Method

Meet with the Host in calm quiet place, and run the meeting as the Sandwich Method.

What is the 3-step Sandwich Method for giving feedback?

  1. Start with something positive (bread)
  2. Cover the negatives (the meat!)
  3. Close with encouraging words (more bread)

Sometimes, managers will describe the bread as fluff, but it really isn’t.

To stay motivated, the Host needs to know where they are strong (first slice of bread), their challenges (the meat), and that you still believe in them (last slice of bread).

(Of course, you might be at the point where you don’t still believe in them! In which case, look further down at Corrective Action.)

You run through the conversation that you prepared earlier:

  1. Here are some areas that are really strong for you! (The A’s)
  2. These are some areas that need improvement. (The C’s)
  3. and, we have talked about your strengths, and some areas that you need to improve, and I am here for you. Moving forward, how about we discuss this when we meet each month?

‘As you cover each Job Skill, do not ask them what grade they gave themselves! That was just an exercise to get them thinking.

Describe the behavior as you see it, with a specific example.

Focus on the behavior and not what you suspect to be the reason:

  • You don’t talk to as many guests as necessary. Not – I think you’re scared/lazy/too busy with your phone.
  • Your appearance needs to improve with a sharper image. Not – I think you’re scruffy, and without taste in clothes.

Don’t ask them to agree to your assessment!

  • They don’t have to agree with you, they just have to listen carefully and then take steps to meet your expectations.
  • If they say, “Well, I don’t see it that way…‘, you say ‘The point here is that I see it this way, so you are going to have to work to change my perception“.

Finally, give the Host something in writing that summarizes the C’s. This can be as simple as this:

  • Jackie, we met on 3/19 to discuss your performance. I have asked you to focus on the following:
    • Make sure you talk to 40 guests a week.
    • Improve your image to be sharper and in line with the rest of the team.
    • Focus on 10 Inactive players to get them back on property.

Ask them to sign your copy, and put it in your folder.

Schedule another meeting in a month’s time to discuss their improvement.

Step 4 – Monitor and give Feedback

For the next 30-60 days, depending on how urgent the situation is, you monitor their behavior, and note specific examples.

  • Send ‘atta-boys’ for positive change. “Hey! Just a quick note to say congratulations on meeting your goals this week”
  • And send ‘Nahs’!  “Hey, we talked about your appearance and I was not impressed when I see your tie undone yesterday”.

I know from experience that it can seem like a large investment in time to meet regularly with each team member and go through this kind of process. But if you don’t, and you just wait until the Annual Review, then:

  1. You are at risk of the employee saying the dreaded words ‘This is new to me!  You’ve never mentioned it! How can you ding me for something that you never told me! I am going to HR”.
  2. Plus! One of your key roles as a manager, is to coach and grow your team.

Are You ‘Done” with this person?

If you ‘done’ with this person, then it is time to meet with your HR representative and find out the process for “Corrective Action” which usually includes verbal warnings, written warnings, and then dismissal.

If your Property doesn’t have a Correction Action process then consider the following steps so that you can protect yourself against a charge of unfair dismissal. You can also Google for Correction Action Process. Consult with your manager and make sure they are aware of what you are doing, and support your actions.

Make sure everything is written down, or in a printed email, and put into a physical folder along with dates.

Give verbal warnings such as ‘We have discussed your appearance. It is is not acceptable and you must improve it within 30 days or you risk disciplinary action that could result in termination’. Hand-write a note for your file that captures what you said, the date, the rough time, and the location. And what the employee said, if anything.

If the change is insufficient, then put the same words into writing. ‘We have discussed your appearance. I gave you a verbal warning on 3/19. I am now giving you a written warning that this is not acceptable and you must improve it within 10 days or you risk disciplinary action that could result in termination’.

And then, if the time comes, you are well-prepared to justify the termination, and you can feel good that you did everything that you could to help the employee.

In summary, your role as the manager is:

  • Be crystal clear about your expectations and whether they are being met.
  • Give the person a chance to change and succeed by being clear, being consistent, giving specifics, and providing immediate feedback.
  • Grow the talent that is on Property

And, not incur the expense of constantly bringing in new people, training them up on your Club and Amenities, and then moving them on because they did not ‘cut it’.

As always, let Jackie know if you have anything to add to this!

 

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Job Descriptions for Player Development

Here is a list of the most basic and important responsibilities in Player Development.

Feel free to copy, paste, and use these ideas in the Job Descriptions for your Player Development team. If we are missing anything, drop an email to jparker@harvesttrends.com

Summary of Responsibilities

The main responsibility of a Player Development professional, regardless of title, is to develop and maintain effective working relationships with a casino property’s very best players and provide services to them to build player loyalty and increase the number of visits or amount played (or both) from among those guests.

In order to do this, a PD pro must also develop and maintain strong working relationships with key allies throughout the property and in the community to ensure players have the experience they expect while gaming and to generate leads for new business.

Job Description for Casino Host, Executive Host, Player Development Executive

Here are the basic job functions in for everyone in Player Development (not necessarily in order of importance):

  • Establish and maintain positive customer relationships with players who meet property criteria (and with those identified to have the potential to reach that level of play)
  • Maintain contact with coded players as appropriate to generate return visits and provide exemplary service.
  • Interact with players in person on property, as well as via telephone, e-mail, text message, and written correspondence
  • Represent the property as a role model of customer service and professionalism
  • Effectively use out-bound phone-calls to keep contact with players that have not visited the property, and to market VIP parties and events.
  • Network among coded players to build relationships among the best customers and to generate leads for new high-worth players
  • Learn about and tailor services to guests’ preferences, likes and dislikes
  • Resolve player issues, whether real or perceived, to the guest’s satisfaction
  • Find the right balance in every situation between the guest’s desires and the property’s rules, regulations and guidelines  (There is always a way.)
  • Invite players to events, tournaments, shows, etc.,  according to their interests
  • Make hotel, show, dining and other reservations and communicate same to guest
  • Issue complimentaries or other offers to guests as play and property guidelines warrant
  • Host special events, player parties, property promotions and other activities as needed
  • Provide information to team and property leadership related to guest feedback, suggestions, concerns or issues
  • Maintain confidentiality of information about both customers and property; share carefully
  • Participate in brainstorming and planning sessions for Player Development program
  • Prepare and submit reports on activities as directed, complete and on time
  • Strive to achieve and exceed goals and metrics/objectives

Job Description for Player Development Manager

A Player Development Manager has 5 main responsibilities:

  • Grow the business; set and monitor achievement of goals and metrics for the team in alignment with the property’s business objectives.
  • Regularly review and re-code the players to focus the PD team on the highest potential.
  • Coach the hosts on how to improve their skills, grow their business, and meet their goals.
  • Resolve guest issues when they have to be escalated to management.
  • Manage the team, the budget, the reporting, and the logistics of events.

If you are a Player Development Manager (or other team leader) you are responsible for:

  • Setting SMART Goals and metrics for each host and for the team  (with a stretch!)
  • Monitoring pace toward goal achievement
  • Analysis of coded and potential high-worth player data
  • Assigning/coding players to hosts
  • Coaching staff as needed
  • Regular and consistent communication with all direct reports
  • Preparing and submitting activity and departmental reports as assigned
  • Attending meetings as a representative of the Player Development team
  • Participating in brainstorming and planning sessions for marketing
  • Implementing programs, events, promotions, etc. for the Player Development team
  • Providing assistance for marketing events as required
  • Resolving player issues, real or perceived, when host is unable to do so
  • Setting an example of excellent customer service

Retaining Players – Don’t Churn, Baby, Churn”

The Importance of Avoiding Churn

If you do not measure Retention then you are at risk of enabling ‘churn’.

Churn is a term used across all industries that basically asks, “Are you busy generating new customers but losing so many existing customers that you don’t really grow?”

For example, an Executive Host acquires 20 new players during the Quarter but somehow 60 coded players slip away and do not play during the Quarter. Overall the Host is down by 40 valuable players by the end. But this won’t become visible until you measure it.

Why does this matter?

  • First, it is harder and more expensive to acquire new players than to retain existing ones. Your PD team spends more time and Comps on trying to attract or identify valuable new players, and have to invest in someone that may not become a loyal guest.
  • Second, there may be some underlying issues with guest satisfaction that you are not identifying and resolving. These were valuable enough players to be coded to a Host; so why have they declined? You need the PD team to reach out, find out what is happening, and get resolution.

So how you measure churn and give the Hosts a solid goal?

Here is a simple example of a Retention Goal. You must retain 95% of your Active Players”. If the Executive Host had 300 coded players on April 1st, then 285 of them must play at least once in April/May/June.

Why isn’t the Retention Goal set at 100%? Well, you have to make some allowance for the ‘inevitable shrinkage’ of guests moving away or  having dramatic changes in their lives.

If you think about your market, you can come up with your own logic. E.g. With 300 coded players, you might expect 2 Deaths, 10  move-aways, 1 becoming restricted, and 5 life-style changes e.g. loss of income. 2+10+1+5=18. So, you expect an inevitable shrinkage of 18. You can round it up to 20 and say the Host must retain 280 of 300 coded players.

This Retention Goal requires some support from the Database team or your Host Software provider. This is what you need at a minimum:

  • At the start of the Quarter, a list of coded players for each Host
  • At the end of the Quarter, an updated list of trips for each player on the list.
  • A way for the Host to know who has not played. This may be a weekly list from the Database team, or it may be built into your Host Software.

Advanced Retention Goals

Over time, and if you have the reporting capabilities, you might want to have a more elaborate Retention goal that uses trips and Theo to ensure the Active players are not only playing but playing at the same pace or better.

Here are two examples. The first definition ensures the Active players are not falling off in trips:

A host retains a player in a quarter if that player makes at least as many trips as in the previous quarter.

This second definition ensures the Active players are not falling off in trips and play:

A host retains a player in a quarter when that player makes at least as many trips as in the previous quarter, and total Theo is 50% or more of the total Theo in the previous quarter.

These goals have gone beyond measuring simple Retention to measuring whether Active players are ‘declining’ and the PD team is held to a higher standard.

This may be appropriate if you are in a highly competitive market, or you find yourself in competitive situation for the first time. However, this requires more sophisticated reporting from your Database team or from your Host Software vendor.

In conclusion, KISS, and keep it simple initially with something like Host must retain 280 of 300 coded players.

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2 Key Aspects of Goals; Effort and Results

When we first think about Host goals, we often think about measures and rules. For example, “a host must contact 60 people each week”, which is a measure, and “a host must not issue a comp for more than 15% of 30 day ADT”, which is a rule.

There is nothing wrong with measures and rules but a goal addresses the larger question of “what are we trying to achieve?

The Miriam Webster dictionary defines a goal as “the end to which effort is directed”.
What is the end that we are trying to achieve by having the host contact 60 people each week? Well, we are trying to make sure that the Host is busy. But busy doing what?

A cynical General Manager might suspect the Hosts are busy contacting the same 60 people that the Hosts always talks to, either because those players are pleasant or because they are demanding. Or the Player Development manager may fear the Hosts are busy talking to people that are already playing practically every day, instead of focusing on trying to get new players, or reactivate people that used to play a lot but seem to have fallen away.

It isn’t enough to measure activity, we need to write goals that measure the effort, and the success, of achieving a good outcome for the casino. We need to change the goal from measuring “the host is busy” to measuring “the host is busy doing the right things.”

After some thought, we create two goals. The first goal is “Contact 10 Inactive players each week” so the Hosts call people that haven’t played for 90 days but had high Theo when they were last playing regularly. (An organized Host will find time to call two Inactive players each day of the five-day week and 2×5=10). And the second goal is “Bring back 20 Inactive players this quarter” so the Host has to find ways to encourage the Inactive players to return.

Here are the two goals:

  • Contact 10 Inactive players each week. (Measures Effort)
  • Bring back (Reactivate) 20 Inactive players this quarter.  (Measures Result)

The first goal measures Effort; it measures whether the Host is trying to contact Inactive players. The second goal measures Results; it measures whether the Host is successful in getting those Inactive players back onto the Property.

Take another look at the Goals in place for you or your team, and see if they need a tweak?

Are they really just Measures and Rules? Or are they truly focused on rewarding Effort and Results?

 

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