Emotional Rescue

Casino Journal - January, 2006

Written By: Fred A. Buro

If anything is to be learned from the mounds of data garnered from social studies about the high school drop out rate, it is that detachment is a key ingredient in student defection from high school.

Detachment could be a key ingredient in customer defection from casinos as well. The energy on a busy casino floor comes from the games, lights, sounds and the people. It is an up beat party atmosphere with a lot going on everywhere that is hosted perceivably by the front line staff of the brand. If you have ever hosted a party, you made sure that none of your guests were abandoned or had a bad time. You involved everyone in the experience. And if your friends had a great time, they told you about it and they talked about it with many of their friends long after. But if they had a bad time, they told everyone about it except you.

In casinos, every front line employee is hosting the party. They are trained to interact and focus on customer needs in order to insure that the guest’s experience is a good one throughout their stay. As modern casinos become technologically advanced, customers have fewer reasons to interact with traditional floor staff. For example; as automation proliferates and more real-time data is provided behind the scenes about customers on property, key decisions can be made about everything a customer desires during a trip without the customer actively participating in a dialogue with a real person.

In the slot world, consider down loadable games and ticket-in ticket-out; once they are deployed together, the staff interaction a player may have on property may be limited to a few words at hotel check-in, one or two words with a restaurant host, from there its up to the waiter. Conceivably, the only slot decision a player may need to make in a casino may be one of geographic preference since any game, with every player parameter including custom graphics, points, cash back and comp information, can be downloaded to any slot device at any location within the resort. In other words, a slot machine in every hotel room may not be a far fetched idea.

These slots can contain anything including every game and every denomination a player may want to play. Even specific player parameters such as hold percentage or customized pay tables based upon desired reinvestment percentages for individual players may be at the real time discretion of the casino, and may be changed at any time; on a day-by-day or, on a game-by-game basis. Slots may be priced based on volume – extending time-on-device on slower days, and shortening time-on-device on busy days.

In addition to downloadable games, slot machines may host a pseudo belly glass - really just a flat screen monitor with a default image; a marketers dream. Once a player card is inserted into the game, an interactive touch screen could appear displaying a variety of information or personal financial options. A custom graphics package could unfold with images designed specifically for an individual player. Programs could include images of their favorite landscapes, food, celebrities, broadcast TV, cable, or photos of past player events or the grand kids - truly a new dimension in CRM dynamics.

In the table game arena, arrivals like automated Roulette is perhaps the real “Hal” of the casino floor, sans a soft calm voice; an authentic Roulette wheel spins under a glass dome with a dozen or so automated betting devices around it, but no dealers are utilized. On another front, the newest card reading technology reads every card a black jack player is dealt. Skill levels may be analyzed and a player profiled instantly. With smart chips, how a player bets is also tracked and monitored. Integrating information like that could easily impact old school pit strategies related to the timing of fills, dealer breaks, changing cards and of course, reinvestment.

The effects of interfacing operational gaming technology with marketing databases can have a profound effect on the gaming event by minimizing human interaction. From the moment a gaming trip is triggered, the gaming event may become increasingly more impersonal which can fuel detachment.
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Fundamental marketing strategies dictate that only meaningful customer differences should delineate market segments, and that the customer relationship should be perfectly managed against those segments. Not withstanding, consumer groups are getting cut into smaller and smaller segments as if more segments guarantee better results. Ultimately, too many segments yield only vague differences between customers. And as CRM strategies place the “right offer in the hands of the right customer at the right time”, technology is right there dehumanizing the redemption process further detaching customers from service staff.

Of course with simpler processes, less staff, faster service, and better tracking, expanded operating margins can be achieved. But that success may also camouflage the defection of really good players. Player’s club transactions, slot attendants, slot techs, change attendants, pit staff, security guards, redemption staff and operators to name a few; all the folks customers interact with on the casino floor, are slowly going away - the consequence of which may fuel detachment.

Gaming is an event but is also a psychological experience which fulfills an emotional craving. Hence, passionate driven employees can make an extraordinary difference to a customer’s gaming experience. Employees personify a brand as well as the gaming experience. When a brand makes a commitment to a customer about a product or service, it’s like someone giving you their word; it is a promise that strikes an emotional cord. It feels good and you want it to come true.

To that end, seek opportunities to make emotional connections with customers where segmentation and technology fall short. Essentially; make promises and keep them. Identify and satisfy the natural desire of your customers to be socially engaged and honored and you will transcend stand alone CRM and reinvestment strategies. Connect with your customers in a way that makes them feel emotionally attached to your brand and you will ultimately solidify their loyalty to it. It may be the single most important thing about your success that your competitors can not easily copy because to them, the process would be invisible.

Benign Betrayal

Global Gaming Business, August 2005

Written by: Fred A. Buro

Through out history, almost every social, political, religious or industrial movement was marked by a major event – usually precipitated by one person with a dream few could completely comprehend. Columbus, Fulton, Gandhi, Einstein, and Galileo to name just a few, were people who sparked life into outrageous ideas that would betray conventional wisdom and ultimately change the world.

Experts are never short of opinions. In fact, numerous inventors, worshipers, navigators, scientists and entrepreneurs often have conflicting views about the same thing which is why many of history’s most famous were infamous fools first. Robert Fulton comes to mind as his folly ushered out the mule barge business and changed river navigation forever. From complex theories about the galaxy, God and gravity, to horseless buggies, motors, electricity, the steam engine, or men flying and going to the moon, most were concepts not contemplated by the average person during a normal day.

Christopher Columbus was considered a lunatic and heretic by some for betraying conventional beliefs about the shape of the world. The earth was truly flat at the time. That was a long time ago. But even in our life time at one point medical experts were certain that it was impossible for a human to run one mile in less than four minutes. Those who kept trying were fools simply wasting their time.

Change threatens. The equity holders of powerful intuitions can fear it for a variety of reasons. Change could meet with resistance from the sponsor of a poorly performing strategy because it means keeping a really good job. And even though corporations need innovation to reinvent them selves, resistance to change can be devastating to a career. Common objections are usually risk/reward based and since change means moving against history, statistics, conventional wisdom and unknown agendas, an innovative idea can be cast as a folly and easily quashed. The ground swell of resistance can be like traveling south on the north bound side of a highway during rush hour. The encouragement to turnaround would be most compelling.

So what does all this mean to marketing and positioning casinos? One example would be when Steve Wynn first presented the concept of the Mirage for the Vegas strip. The idea was considered outrageous by some. But he secured funding and in the face of his critics who by the way assured its failure, built it. The Mirage was no folly either. It became the standard for mega casino resorts the world over. Sheldon Adelson did something similar with The Venetian. The willingness to betray convention fuels innovation and perhaps is the essence of vision, leadership and progress, and are traits that these men and other icons in our industry share. Their journeys seemed to be navigated within dynamic parameters; the powerful and the visionless, and, the visionaries and the powerless.

Building a casino bigger and better to cannibalize customers from competitors is like using a battering ram to open a door. Which is exactly what The Mirage did in Vegas and the Borgata did in Atlantic City. Despite the demagoguery and dispersions, the conventional styles and concepts of the prototypical physical plant in those markets was betrayed. The strategy seems extremely risky as it requires obscene amounts of capital and belief in a vision few could share. The proof of which may be the names on the buildings. Those deals were not preempted by anyone

And from the day they opened they were instant success stories. They immediately gobbled up market share although they ultimately grew the market. Of course, precise timing, a strategic location and excellent performance are mandatory components. And as always, the score card is graded by customers. At the recent opening of Wynn Las Vegas someone was quoted as saying ‘what I think about the property doesn’t matter any more. It’s up to them now”. I think it was Christopher Columbus reincarnated.

If you don’t have the stomach for the battering ram approach, performance excellence may suffice to sustain growth for shareholders. But a precise allocation of resources and assets to short, mid and long term yield strategies may not be enough because with consolidation, emerging jurisdictions and expansion, those strategies must remain fluid. The Harrah’s Caesars acquisition has created a single operator with over 40 casinos in several countries and over 47 million loyal customers in its database with a potential mega hub that could make Flamingo and Las Vegas Blvd the most significant intersection in the entertainment world.

Imagine a couple dozen super Wal-Marts, in a row, on a single street or strip in the middle of the dessert, with similar stuff inside, at competitive prices. As a customer, which one would you walk into? Harrah’s tracks are pretty clear - and if you trace the steps and add a little vision; the picture at this stage anyway, once again may betray the conventional physical plant and the proven strategy of simply building “one” newer bigger and better than all the others. Imagine “seven” bigger and better properties stratified by their individual amenity set but physically and seamlessly linked in some way smack in the center of the ultimate gaming and entertainment destination of the world.

Harrah’s, Caesars, Bally’s, The Flamingo, Paris and The Rio; the ultimate place for every gambler including each of its own 47 million loyal customers to stay and play when they visit Vegas - truly the perfect location within the only location of its kind in the world.

Of course, what ever the manifestation, that foot print will not create doom and gloom for the Vegas market. In fact just the opposite is more likely; perhaps another spectacle in a spectacular city that is a”must see”. Although, I suspect calling it an attraction or the next generation volcano would be a slight understatement. Hence, the barriers to entering the Vegas market may get even larger along with exit barriers for the Harrah’s Caesars Total Rewards customer.

This looming development reminds me of a Star Wars movie when the immense Death Star was almost complete. Not comparing anyone to Darth Vader mind you. Not withstanding, he was really smart and a good Jedi Warrior at one time. Anyway, while driving EPS quarter after quarter dominates gross amounts of resources from every company, the focus for a while anyway, may remain on what impact Goliath’s next move will have on the rest of us Davids. Figuring out that master plan beyond Las Vegas lay in the cross hairs of a few I would suspect.

And given the fundamentals of price, product, performance, and distribution; one option to be considered would be; expanding the product distribution network through other distribution channels. A merger with a mega entertainment or communications giant such as Time Warner or Disney might be one vision which if realized, could eclipse the gaming industry in a way that could leave the revered monoliths of the Vegas strip far behind as old generation gambling halls.

Fred A. Buro, Chief Marketing Officer MTR Gaming Group

Fred A. Buro 
Chief Marketing Officer – MTR Gaming Group
24 years experience in marketing and managing casinos.  Buro is currently the Chief Marketing Officer at MTR Gaming Group where he’s been for the past five years, but also held that position at Columbia Sussex Corp. where he was responsible the development of the corporate marketing organization and all marketing for the company’s portfolio of thirteen casinos.  

His current responsibilities include branding, positioning, public relations, digital/online marketing,  social media, marketing audits, seo, loyalty programs, dmdr, advertising, internet gaming including i-poker, competitive set analysis and market assessment, developing and integrating short, mid, and long term strategies for all properties.   Fred also has extensive experience in all facets of casino operations and was President & Chief Operating Officer for the MTR Gaming Group at Presque Isle Downs Casino, President & COO for Trump Hotels and Casino Resorts at Trump Plaza Hotel & Casino, President & COO for Penn National Gaming at Charlestown Races& Slots, and President & COO for Columbia Sussex Corp. at Tropicana AC.

Fred A. Buro

Articles and comments by Fred A. Buro - mostly about casino gaming and marketing.