by Sudhir Kale
CRM in Casino Campaign Management: The Perils of Mass Customization.
Readers of urbino.net are probably aware that I started in the casino industry as somewhat of a high-end player, and after having paid the tithing for a number of years, moved into researching the casino industry, writing articles about it, and consulting for casinos. Having seen the industry’s offerings from a player’s perspective, I quickly realized the importance of customer relationship management in gaming (probably before Harrah’s started harnessing CRM concepts to make a science out of customer targeting).
One of the key features of CRM strategy is “mass customization.” Joseph Pine, considered to be the father of the mass customization movement defines it as, “the low-cost, high-volume, efficient production of individually customized offerings,” and goes on to add, “It’s only true customization if it’s done in response to a customer order, reflecting the needs of a real, live, breathing customer.”
Based on the above definition and elaboration of the mass customization concept, I have come to realize that most casino organizations do a wretched job of mass customization in their practice of CRM. Let’s look at a couple of real life examples.
From 1996, I have been a card-carrying player at Conrad Jupiters, the casino on the Gold Coast. There was a time when I knew over half of the around 2,200 employees by name. Being an avid blackjack player, the casino used every conceivable opportunity to communicate with me using both direct mail as well as e-mail. One would think that after 13 years of the “relationship,” the casino would get my salutation right. Think again.
Even though I do not play as frequently or at the level I did when I started, the casino still periodically sends me promotional material. The salutation used in each piece of mail is, “Dear Sudhir H.” Excuse me, but I never consented to be addressed along the lines of Kenny G. After thirteen years, the casino still gets the salutation wrong when it sends mail to one of its highest lifetime value customers.
The second example is within the consulting context. I was the lead CRM consultant for one of the largest casinos in the United States. In the course of this assignment, I worked very closely with the CIO of the company. The casino also owns a basketball team and the C-level executives get free tickets to every game when the season is on. The CIO’s wife is an occasional slot player at the same casino. When she “qualifies” for a comp, the casino incentivizes her by sending her two complementary tickets for the basketball game! The CRM system, in this case, looks at the level of the player and automatically issues the basketball tickets, not realizing that the player is the spouse of one of the most highly ranked execs in the company and does not need or want the free tickets.
Returning to the Conrad Jupiters example again, this year I did not receive my Club Conrad (the Club Privé) card. The database, when mined, probably revealed that my “action” at the casino is down to almost non-existent, and I therefore do not qualify to play in the private high-end gaming area. I hope I don’t sound immodest here, but most casino companies would WANT me to tour their private gaming area, and some even pay ME for doing so. All senior execs at Conrad Jupiters are aware of what I could contribute to their strategy and to delivering the right customer experience. Few, I am sure, are aware that I have been dropped from the membership of Club Conrad. This is one more instance of mass customization gone astray.
These three examples amply demonstrate the mediocre manner in which casino companies typically handle mass customization. Mass customization, particularly in marketing communications, should not be difficult to implement. Anything that can be digitized can be customized, and customized correctly. As Joe Pine asserts, “Any company in the world… can reach any potential customer in the world with a digitized representation of what it has to offer, and can change that representation—and then the actual offering—to meet the needs of that individual customer.” All it takes to do mass customization right is the correct mindset on the part of management.
When incorrectly done, mass customization comes across as phoney and inauthentic and has precisely the outcomes management wants to avoid. The crux of CRM is customer relationships, and not many customers want relationships with a supplier they perceive as being phoney. Casinos interested in building long lasting relationships with their key customers should make “authenticity” the mainstay of the relationship. They will do well to heed Joe Pine’s advice, “Authenticity is becoming the new consumer sensibility—the buying criteria if you will, by which people choose what to buy and whom to buy from. They no longer accept the fake from the phoney; they want the real from the genuine.”
Date Posted: 03-Jul-2008
Sudhir H. Kale, Ph.D., is a “genuine” consultant and trainer for casino companies, offering “real” value for optimizing marketing strategy and delivering an authentic customer experience. He serves on the faculty of Bond University’s School of Business and is the CEO of GamePlan Consultants. Sudhir has written over fifty articles on the marketing and management aspects of gaming. You can download some of his articles at www.gameplanconsultants.com, or write to him at firstname.lastname@example.org.