What can hotels learn from casinos? In my first post on this topic I explored how casinos apply predictive analytics to help them focus on their customers. In this post I will explore how casinos use analytics to help manage the service environment with the dual goals of improving profitability and customer experience. But first, let’s kick off with some of the crazier myths about how casinos manipulate their physical environments to make you, the patron, gamble more.
I’ve heard it claimed that casinos pump hyper-oxygenized air into casinos to keep your mood buoyant and attention focused on gaming. I have also heard claimed that there is a big red button in the basement that can dial up or dial down how much patrons can win! Neither of these rumors are true, but there are a lot of moving parts in a casino. Casinos do manage their service environment, and they use analytics and data management to help them do it. They focus on things such as the location and placement of the slot machines and gaming tables, the denomination of those machines and minimum bets of the tables, as well making sure that they have the skilled team members to manage these experiences and also the patron themselves.
When it comes to planning the operations of a casino floor, bad decisions can mean significant losses in customer loyalty and potential revenue. The challenge is how to plan the right mix of gaming choices, denominations, and table or machine placement to optimize the patron’s interest. In Canada – 85% of gaming revenue is made up of slot machine revenue. As a result, slot operations are a primary focus of their analytics.
Saskatchewan Gaming Corporation, operator of the Casino Regina, has placed a lot energy and analytics into how they manage their slot operations. They pulled together all of the transaction data on their slot machines and created a best-case predictive forecast into how each game would perform in the year to come. In the process, they began collecting insights into leading predictors of patron preference for machines. This helps them optimize profitability. They also looked at how they can predict the impact of potential changes to slot performance based on ‘what if’ scenarios.
Finally, Saskatchewan Gaming Corporation used advanced optimization to determine the best approach to future business, considering factors such as physical space and budget. This information helps the casino company to optimize its slot machine purchase options, including the analysis of which machines to replace and when to replace them, while also ensuring the patron experience is not hampered through excessive machine down-time. Analytics allows this casino company to offer the right games, in the right locations to attract loyal and valuable patrons.
Optimization techniques are not isolated to machines for casinos but can also be used to ensure that the right service operations staff are available to serve patrons. It’s important that if you offer a patron a meal, that you have a seat available in the restaurant for that patron. Patrons who have to wait for service in a restaurant or a seat at a gaming table may be tempted to take their business elsewhere. Forecasting demand for each service area, and matching the right skill set to the area is very important for casinos. Just think of all of the different skill sets required to run a gaming floor, from the different dealers to the cashiers, pit boss and machine technician. Optimization approaches are needed in every aspect of casino operations.
Casinos also carefully manage the patron’s service experience while they are in the casino. Casinos use master data management techniques to ensure that they can use what they have learned about their patrons to enhance the patron experience. Master data management can deliver the results of analytics to the service operations team members, to ensure that each patron is recognized and treated appropriately and most importantly - consistently.
Managing the patron’s service experience is particularly important when something starts to occur that none of us really want to think about when we are in a casino, and that is losing. If a patron hits a losing streak their enjoyment may start to decrease. The patron may decide to leave the casino and “try their luck” somewhere else. Casinos know if they offer patrons a free meal or a drink at the bar, allowing the patron to step away from the losing experience and focus on something else, the patron will start to enjoy themselves again. Casinos trigger alerts to their service teams to identify patrons who are losing. These alerts can be informed with analytic such as customer lifetime value and next best offer, which helps the service team take the appropriate action to correct the customers experience while at the same time remaining profitable.
While the loss of a casino patron may be much more “of the moment” than that of a hotel guest, the use of analytics and data management to help detect and avoid that act of attrition is something that all hotels could benefit from. How are you detecting behavior changes in your guests? Do you have steps in place to identify when the customer experience is going wrong, or when the customer is about to leave you?
Casinos use master data management (MDM) techniques to communicate important customer preference information to staff who sit at each interaction point. Master data management is the processes, governance, policies, standards and tools that consistently define and manage the critical data of an organization to provide a single point of reference. One of the benefits to service organizations of using MDM is that when that single point of reference is a customer profile, the master data can ensure that the treatment of customers is consistent and that preference information reaches all customer points of contact.
How do you ensure the service experience is consistent across your operation and throughout your estate? Are you relying on information hidden in the comments field of your property management system? Are there small “moments of truth”, such as the preferred pillow or using the preferred method of address that mean the guest stays satisfied?
When you proactively manage the service environment, you can deliver on a great guest experience and avoid customer attrition. Casinos use solid data management techniques to help communicate their guest’s preferences and predictive analytics to identify moments when intervention is required.
No hyper-oxygenized air required.