A Psychographic Approach to Customer Segmentation

by Andrew Klebanow

A Psychographic Approach to Customer Segmentation

Market segmentation has long been recognized as a fundamental tool of casino

marketing. Casinos throughout the world segment their customers based on a variety
of criteria. Casinos in Las Vegas use criteria such as Convention, Tour and Travel,
Retail and Invited Guests. Atlantic City casinos have additional criteria defined by
mode of transportation and distance traveled such as Bus - Line Run, Bus - Charter,
Inner Market and Outer Market.

When designing database marketing programs the vast majority of casinos segment
their databases based on theoretical win or actual win (monetary value), trip
frequency and recency of visitation. Once these segments are defined, casino
marketers can then design direct mail campaigns that generate profitable,
incremental visits. Rarely however, do casinos ever approach their customer
segments based on behavioristic or psychographic characteristics.

The notion of examining gaming customers based on their psychographic profile was
first broached by casinos in Atlantic City in the mid-1980’s. This article examines the
various types of behaviors most often displayed by casino patrons and how casino
marketers can better design marketing programs to meet their needs.
The Five Behavioral Segments
Early studies identified three basic psychographic segments among casino
customers: Recognition Seekers, Escapists and Reward Seekers. With the
proliferation of local casinos throughout the world, additional segments have become
evident. These include Socializers and Professionals.

Recognition Seekers
Recognition Seekers represent a small share of total players yet they command a
considerable amount of attention from the casino. These players have a high
expectation of recognition from the property they patronize. They expect floor
supervisors, restaurant maitre D’s and dealers to quickly recognize them and
acknowledge their presence. They expect hosts to promptly greet them when they
appear on property. Player Development departments are designed, in large part, to
provide the recognition and service that this segment demands. The reward to the
casino property is an intensely loyal, profitable and frequent visitor.

Escapists
Escapists seek a getaway that does not resemble their everyday routine. Gambling
invigorates them and awakens senses not normally stimulated in their everyday
routines. By their nature Escapists prefer to remain anonymous. In other words, they
enjoy coming into a casino and playing with minimal interaction with casino
personnel. They share their loyalty among a small number of properties and require
minimal maintenance in the form of personal attention and complimentary services.
They are therefore a very profitable segment.

Reward Seekers
Reward Seekers are driven to visit a property by the casino’s player rewards program
or promotions that compensate them for their play. They believe they have a vested
interest in the promotions and bonuses that casinos have to offer. It is their ability to
identify the best “gaming value” that validates their superiority over other players and
the casino in which they play. Double point days and other promotions that enhance
the value of their gaming experience are primary motivations for selecting one casino
over another.

Reward seekers are also capricious in that they will patronize the casino that has this
month’s best offer. Their gaming play goes to the casino with the best deal. They
have an inflated view of their gaming worth and believe casinos will do whatever it
takes to keep them as customers. They are the first to complain if a companion
player receives a mail offer and they receive one of lesser value. They are a
marginally profitable segment and represent the casino’s “grind” play.

Socializers
Socializers visit a casino in order to escape the mundane world around them and to
be around others. Even though gambling is itself an anti-social form of behavior,
requiring concentration and little distraction, it is the social environment of casinos
that attracts these people to a particular property. One need only walk through a
bingo hall prior to the start of a session to understand the social nature of game.

Socializers are intensely loyal and build relationships with change people, floor
personnel and other gamblers. Once they identify with a particular property they
become a very loyal, very profitable segment with high levels of visitation. Day in and
day out they are the casino’s best player segment.

Professionals
With the proliferation of liberal table game rules and full-pay video poker, a small
cadre of players makes a living gambling in casinos. They pay very close attention to
the types of games casinos offer. They closely scrutinize the pay tables on video
poker games, the value of the cash-back component of a casino’s player rewards
program and comping policies.

Professionals generate large coin handle and accumulate voluminous amounts of

slot club points. While an analysis of their theoretical win may indicate a profitable
customer, more often than not their actual win/loss is difficult to gauge. Professionals
readily pull their cards from reader boxes in the middle of a video poker hand if the
outcome looks favorable in order to hide the true payout. This segment understands
how slot clubs work and how casino managers evaluate play.

Professionals will employ a variety of techniques to defend their position in a casino.

They brag to hosts about the friends they bring who are not knowledgeable gamers.
They readily turn to hosts for upgraded rooms and meals without debiting their comp
dollar balances. This segment also poses the greatest threat to local gaming
properties seeking to broaden their destination gambler segment. They prey on
unsuspecting hosts eager to demonstrate their ability to bring in “big players.”

Professionals also share their knowledge in Internet discussion groups. Since their
goal when visiting a casino is to consistently make money they become resentful
when a casino tightens up their promotional policies and share their views with
others. Casinos do not make money off of professionals and their loyalty goes to the
casno where they can make the most money.
Design Programs Based on Player Behavior
By understanding what motivates player segments to choose one casino over
another, casino marketers and slot operations managers can design programs that
target the most profitable segments while discouraging the least profitable. Casinos
that do not make a conscious effort to understand the motivations that drive these
various segments to their property risk attracting the least profitable segments.
Casinos that attempt to build traffic through liberal gaming rules and full-pay video
poker pay tables risk attracting Professionals. Multiple promotions layered on top of
mail programs attract Reward Seekers. Once the promotion is over and the mail
offers are redeemed, they seek another casino in which to play.

The most profitable segments are not necessarily the ones that are attracted by the
traditional marketing practices of many casinos. Socializers require little inducement
to visit once relationships have been established. Escapists can be prodded to visit
through marketing programs that assure their anonymity while Recognition Seekers
demand respect and appreciation for their loyalty. By first understanding what
motivates players to visit, casinos can better design marketing programs that stand
the best chance of delivering the most profitable player segments to their property.

Date Posted: 20-Feb-2009 http://www.urbino.net/articles.cfm?Index_ItemID=135

The Gaming Village Must Deliver An Exceptional Guest Experience

by Martin R. Baird

The Gaming Village Must Deliver An Exceptional Guest Experience

By Martin R. Baird

As I write this column, I'm flying home from business meetings in Greece. For the
record, I believe Greece is a wonderful country with outstanding casinos and some of
the most warm, friendly and welcoming people you will ever meet. The people of
Greece take hospitality to an entirely new level. I had many advocate-creating
moments.
But I’m struggling with something. What happens to these cheerful people when they
go to work? I hate to say it, but service in Greece is not good. As I visited a variety of
businesses, I was almost always disappointed by the service. Employees at these
establishments were often cold. At best, they were just going through the motions.
There were exceptions, of course. So why can’t those positive experiences be the
norm?
Please understand that my comments are in no way a condemnation of Greece. If I
was returning from Wisconsin or Indiana and had encountered the same situation
there, I would ask the same question. But, alas, I am focusing my attention on
Greece.
As I walked around Athens at night from 10 o’clock until early in the morning, the
people who were out and about were friendly, laughing and having fun. They were
with friends and enjoying the moment. But at work, they didn’t smile or try to help
customers have a positive experience. Here’s a specific example. After dinner one
evening, my hosts decided we should have something sweet. We walked a few steps
down the street to an outdoor ice cream parlor. Our server was horrible. She was
slow even by local standards. I mean amazingly slow. The table wasn't bussed when
we arrived and it took a long time to get that simple job done. Timely service is
important for any business. It’s critical if you want customers to patronize you again.
In addition to being slow, this young woman was miserable. She never smiled or tried
to make our visit fun. The brand of ice cream we had is known worldwide, so why not
just buy it at a grocery store and take it home for enjoyment?
I can hear one of my Greek friends saying that this server was just having a bad day.
Perhaps that was the case. Or maybe she doesn’t like her job. I don’t want to be rude
but, as a customer, I simply do not care. Her problems are not my concern. When I
choose to spend money, I want to have a positive experience. It’s not about the
server. It’s about me and my family or friends and what we get for the money we pay.
In other words, the price of the ice cream also includes a premium for the experience.
The next day, I had lunch with a friend and we talked about the fact that the
restaurant charged three Euros for a beverage that probably cost one Euro. I
explained that the customer pays one Euro for the drink and the rest of the money is
for the experience, the service and the use of a glass. Customers always pay a
premium for the experience and that is why it should be a wonderful one.
What does all this have to do with casinos? Face it, folks, I am just like your guests.
Your guests have the same expectations I do. The last thing in the world you want is
for them to whine to others about the lousy gaming experience they had at your
property. Greek retailers need to pay more attention to their customers and you need
to focus more on your guests.
I used the word “village” in the headline for this column because that is what the
Greeks call a small community of a few thousand people. The reality today is that we
have a gaming village. We have a few thousand casinos that dot the landscape of
the globe. It really is a small community and casinos cannot afford to get it wrong.
Now is the time for the gaming village to take action about the way its people deliver
the product, which is service.
As I visit casinos around the world, I can’t help but wonder if the people who work
there are that miserable when they go home or out with friends. Are they just sour by
nature? Or does the flogging start when they arrive for work? If some of your
employees are miserable, please do the humane thing and remove them. The world
has a place for them. It's just not working in a people business like gaming. If the
problem is the floggings, why are you doing that? I think most people are good, kind,
friendly and hospitable. How are you managing to mess that up? I say “manage”
because I think poor service has a lot to do with the way people are handled by their
supervisors. Are you inspiring your employees to create an amazing experience for
each and every guest or are you telling them about the 99 ways they can be fired?
I like the concept of a village. One of the advantages of a village is that people work
together and help each other out. I know that at some level casinos compete with
each other. Each casino wants guests to spend entertainment dollars only at their
property. But set your competitive nature aside for a moment and think about this – if
all casinos gave their guests a better experience, wouldn’t the entire market expand?

Gaming is wildly successful and that’s probably why no one steps back and asks
what would make the whole industry better. Business executives often talk about
their stakeholders. By that, they mean their employees, customers and
investors/owners. Well, doesn’t the entire gaming village have a stake in the future?
It all starts with your guests and the experience they have at your property. What do
they see when they arrive? How are they treated by your employees? Do they have
fun? Do they get their money’s worth for the premium they pay? Turn them into
advocates for your property instead of whiners.

Date Posted: 12-Apr-2008

Experiential Casino Marketing

by Desmond Lam

Experiential Casino Marketing

by Desmond Lam
I just returned from the Venetian Macao-Resort-Hotel today after attending a trade
convention and decided to write this article. So far, my experience at Venetian Macao
has been a positive one.

I stayed in its suite two days after its official opening, took a dip in its pools, visited its
massive casino floor, shopped at its retail stores, and ate my favorite Hainanese
chicken rice in its food court. Personally, I think that its model of ‘weekend for
gamblers and weekdays for MICE visitors’ has worked well so far.

When Venetian first informed me of their special room rate at HK$ 1,088 via mobile
text message, I was thrilled and booked a room minutes later; I learned later that
none of my colleagues received this message. “I’m so special”, I thought. When my
wife heard (from her friends) of the first Venetian Festival, she put on her shoes, took
my car and drove off to Venetian. Just yesterday, Venetian offered more than a
hundred free tickets to our university staff and a thousand tickets to our students to
watch the NBA basketball match between Orlando Magic and Team China in its
arena. The tickets were snatched up within minutes. Our students and staff were
overwhelmed. For many of us, this is a golden chance to experience Venetian and its
offerings. To a certain extent, this is experiential marketing at work.

Experiential marketing focuses on brand awareness, image and, very importantly,

customer experiences. It deals with the emotional aspects of customer interaction.
The true essence of experiential marketing lies in genuinely good quality brand or
products, selectivity of marketing efforts on attributes most important to potential
customers, and good use of marketing research as well as customer data.

Experiential marketing calls for a deliberate effort to let potential customers

experience the brand or products that you market and let these people know what
your casinos/resort means and how it is defined. In some cases, this can be
accomplished with print or television advertisements that are deliberately created to
arouse the feeling which patrons will experience if they enter and enjoy your facilities.
More commonly, and perhaps more effectively, it is done by selectively inviting
potential customers (i.e. opinion leaders or early adopters) to your venue and
ensuring that they get the experience of their lifetime - the experience that is defined
by you and represented by your company, brand and products. This is critical for
experiential marketing to work.

Contrary to experiential marketing, traditional casino marketing efforts focus on

rational aspects of customer interactions by stressing on the benefits (or sometimes
costs) of a brand or product. Imagine this traditional print ad: “We are Asia’s Las
Vegas. We have 3,000 beautiful suites, more than 350 attractive retail stores, around
800 table games and 3,000 slots, and a multipurpose arena that can fill 15,000
people! Come visit us now!”

Telling your potential customers how good you are is simply not good enough in
current state of the gaming market. In experiential marketing, we let the customers
experience the benefits themselves; the true worth of your products. Positive
emotions that are generated toward your brand or products would then be more
lasting and creates an emotional bonding between you and your best customers. All
these can greatly increase your differential advantage over other competitors,
particularly in a matured market where physical product differences are minute.

To some executives, experiential marketing simply means throw in the freebies and
then get the customers to come. That is totally untrue! It is important to note that one
does not issue free dinning coupons and stops there. The subsequent dining
experience must be deliberately enhanced to maximize the experience given to these
free dinning coupon holders.

All these are easier said then done. A good experiential marketing campaign should
focus on maximizing the experience of potential customers, and not on short-term
sales. Forget about how to get them to spend spend spend the moment they enter
your facilities. Think about how to give them a great experience when they come. If
you do it right, they will feel the passion and will come back again, bringing along
their families and friends!

A carefully planned campaign like this calls for a more intimate (emotional)
interaction with each (selected) customer with the hope to generate the highest
emotional satisfaction. Positive actual experiences by these customers may then
lead to subsequent purchase behavior and further re-purchases. They create a more
permanent loyalty and help generate valuable positive word-of-mouth, leading to
greater sales.

Put it simply: Don’t tell them how good you are, let them experience how good you
are and bond with them. If they like it, they will give you their lasting loyalty.
……………. Date Posted: 23-Oct-2007

The ROI Question: Answer It By Measuring Guest Advocates

by Martin R. Baird

The ROI Question: Answer It By Measuring Guest Advocates

By Martin R. Baird

“What gets measured gets done. What gets measured and fed back gets done well.
What gets rewarded gets repeated.” – John Earl Jones

Casino managers who want to improve their property’s customer service have lots of
questions for people like me who help them reach that goal. But the most frequently
asked question is this: what will be my return on investment?
I’ve been a consultant to the gaming industry for many years now and I’ve always
hated that question. I could give mountains of anecdotal evidence and show reports
on how much guest complaint calls to tribal leaders had declined. But the chief
financial officer would always get back to that one issue and say, “Marty, that is very
impressive. But what was the ROI?" The import word in that question is “investment.”
Too many casino executives view a measurement and improvement program like
ours as an expense when, in reality, it's an investment in the casino and its people. I
realize what we do is not like bricks and machines that they can show on a balance
sheet, but it's still an investment nonetheless.
The challenge has always been measuring the outcome of the investment in
improvement. It's difficult to say that quality service created a revenue increase when
slots managers claim it was the new mix of machines. Or the CFO could attribute
higher revenue to the area’s growing economy. Here’s one of my favorite executive
explanations – the weather. It was warm, so business was up. The next quarter, that
same person would say business was good because it was cool and rainy. I'm not
sure how that works but, then again, I'm not a CFO.
This has all changed with some wonderful research that was published by Harvard
University and further studied by the London School of Economics. Researchers
found that by tracking customer "advocate" levels, they could arrive at a very high
correlation to the future growth of a business. In other words, the higher the level of
advocates, the more likely the business was to grow. Now pay close attention to what
I say next and re-read it. When I use the term advocate, I’m referring to a very
specific and highly studied form of measurement. If you hear that word used as a
generic term for guest satisfaction in gaming, please understand that guest
advocates and satisfied guests are not the same thing. Advocacy and satisfaction are
worlds apart.
This research found that in some industries, the correlation between the
measurement of advocates and future growth was as high as 98 percent. In gaming,
we have found that it’s lower, but a mid-80 percent correlation from tracking
advocacy is better than any other measurement tool available.
In his quote at the top of this column, John Earl Jones, a training and organization
development expert, says what gets measured gets done. I totally agree.
Unfortunately, if your casino is only measuring guest satisfaction, your hard-working
employees are chasing a score that has absolutely no correlation to the future growth
of your property.
That brings me to the next line of the quote. Who decides what is getting done well?
Is it the CFO who fixates on ROI? Is it the GM who strolls through the casino and
sees nothing but smiling employees? Is it a mystery shopping company? Mystery
shoppers do serve a very important role. They can identify serious defects in your
service delivery. They see with real eyes what your guests see each day. But a
mystery shopper doesn’t measure a guest’s advocate level. It's critical to measure
what is important to your guests and the next step is feeding that data back to both
guests and employees. Much of the resistance to service-improvement programs
comes from team members who are not clear on why the improvement is being
done. At a casino that’s already successful, it’s hard to get employees to understand
that it’s all too easy to fall from the mountaintop. Your property could be "the" casino
of choice today and just an option in a few months. People are fickle and what made
you the casino of choice could change simply because you stopped providing service
that matched guests’ wants and desires.
The final part of John Earl Jones’ quote deals with moving people from an existing
pattern of behavior to a more desired behavior that’s repeated again and again. As I
mentioned earlier, all employees smile when the GM walks by. Everybody knows
that. So how to you get them to repeat that simple, basic behavior with each guest? I
know it sounds corny, but guests appreciate smiling employees. It's important to add
that this behavior must be sincere or it looks like a bad skit on Saturday Night Live.
It takes a system to move people from how they behave on the job now to how you
want them to consistently behave. It’s not enough to just hand out random rewards
that create more of an entitlement mentality than the understanding that behaviors
have direct consequences. Consequences are both positive ($25 gas cards) and
negative ("you don't fit our vision for the future.") If people see themselves as
insulated from consequences, the inmates are soon running the asylum. Set
expectations and hold people accountable.
I know I’ve covered a lot of territory here, so let’s summarize. If you want your casino
to be more successful, what you measure to get there is critical. Credible research
shows that guest advocates should be measured. A system of internal improvement
that results in desired employee behaviors will create more advocates. Employees
must be kept in the loop so they understand why improvement is important.
Advocacy has a high, measurable correlation to future growth. And there you have it
– an ROI based on proven, definable results. …………………… Date Posted: 03-
Sep-2007
The Path to Success Is Not In the Knowing, It’s in the Doing
by Martin R. Baird

I've been writing recently about the importance of casinos turning their guests into
advocates. But there's more to it than simply understanding that advocates can
generate new growth. Casinos will not move down this path to success if they don't
take action to make it happen.

First let's review what advocates are and why they are important. Advocates are
guests who would be willing to risk their reputation and act as advocates for a
property by spreading positive word-of-mouth advertising of their own free will. Guest
advocates are highly likely to return to play again and generate new business
through the positive word they spread about the casino. I want to make it clear this is
not a "satisfied" guest because they are fickle and change with the wind. Measuring
and trying to create "satisfied" guests is a waste of time, energy and money.
That knowledge should get any casino interested in creating as many advocates as
possible. But in order to do that, they must have a turnkey system in place to gather
data on guest advocates, put the data into action, make people accountable for
leveraging it and keep the process rolling forward smoothly. The heart of this system
should be a set of best business practices that not only makes things happen but
also gets everyone in the casino out of their old habits.
I read a quote in a new book recently and it was the same thing I have said so many
times after speaking at conferences. The presenter left the stage and could see the
excited faces of the executives. But he was disappointed. When asked why, he said,
"Because people are leaving happy and motivated but they do not have the people or
processes in place to do what we have just shared with them. Once they get back to
the office, they will do it the same way they have done it in the past."
Casino employees all too often do things the same way they did when they were at
another property across town or on the other side of the world. But best practices will
change all that and generate the action needed to create future success.
Here are my suggested best practices: leadership, program management, goals and
metrics, incentives, action planning, improvement, and guest and employee closure.
If you introduce a new system and want it to succeed, these are the areas where you
must focus your attention.
I only want to make one point about leadership. For improvement to happen, the
casino’s leadership must do more than just support the changes. It must truly lead. I
work in the area of guest service improvement and I laugh when I hear casino
executives say service is their No. 1 priority. Later when we walk through the halls in
the back of the casino, they don't smile, make eye contact and say hello to the
employees. If you want change to happen, management must lead through example.
Program management is critical but challenging. Why? If improvement is going to
happen and it affects multiple departments, centralized management of the change is
difficult to achieve. Slots never likes to hear people from table games telling them
how to run their business. This makes it challenging to manage the change or to
apply the new system.
Another challenge of program management is that the people who are expected to
"manage" already have full-time jobs. Asking a person who works 50 to 60 hours a
week to manage a new program is not easy. It can help sometimes to use outside
resources that are focused on implementation of the new system and designing it so
the casino can take over when the time is right.
I get frustrated when I talk with casino leaders about goals and metrics. The idea of
having measurable goals and metrics for departments is hot right now. Casinos
understand that the performance of all departments should be measured. The part I
don't understand is what people are thinking when they create the measurements.
For example, if my bonus is determined by turnover in my department, I may hesitate
to fire an employee who provides less than great guest service. That will bump up my
turnover and there goes my bonus. As the casino rolls out its new system for creating
advocates, the goals and metrics for ALL departments must be tied to a common
goal. That common goal is what creates incremental improvements.
Employee incentives are the next step in the process. You’ve got this new system
and a clearly defined common goal. Now dangle a carrot out there so people work to
achieve it. If people know they will be rewarded for doing what's expected of them,
they will bend over backwards. The incentives need to be the same for all
departments. This creates synergy that delivers a clear message to all employees.
The next two best practices, action planning and improvement, are the cornerstones
of progress. This is where the talk turns to action in the form of an actual plan. To
me, this is the weakest link for most casinos because this is where change happens
and that creates fear. It's said that water follows the path of least resistance and so
do people. The word "improvement" is just another way of saying "change" and most
people don't like to change. Expect a variety of resistance.
Now comes closure. What was started needs to come full circle. ResponseTek did a
study and found that 95 percent of companies collect feedback but only 5 percent of
them inform customers and employees of the resulting changes. Your casino's
employees will want to know how things are progressing, so keep them informed. As
part of the system, guests should be asked how the casino can be a better place to
play. Let them know how their input was used.
The path to success is not in the knowing, it's in the doing. Understanding that guest
advocates are important to a casino’s success is not nearly enough by a long shot.
Success will only come when that knowledge is put into action with a turnkey system
that has everybody onboard and excited.

Date Posted: 22-Jun-2006

A Commitment to Guest Service Is Crucial At Casinos and

by Martin R. Baird

A Commitment to Guest Service Is Crucial At Casinos and

It Must Start At the Very Top With Senior Management

Quality guest service happens only when the service mind-set starts at the top of a
casino’s management ranks and trickles down to everybody.
“A commitment to outstanding guest service must exist throughout a property’s
employee ranks but it must start at the top with senior management,” says Martin R.
Baird, president of Phoenix, Ariz.-based Robinson & Associates, Inc., a guest service
consulting firm for the gaming industry. “Successful casinos know they have to do
this to stand out from the competition.”
Following are five tips from Baird on how casinos can apply the secret of
top-level service commitment to make their guests happy.
Number 1 – When employees are expected to go through service training, the
lessons are much easier to learn when they see the casino’s executives leading the
guest-service charge.
Number 2 – Executives also must take the training to demonstrate their commitment.
“When the general manager participates in the training along with hourly employees,
it sends a very strong message to all of the people that this is important,” Baird says.
“Word gets out that guest service is a mission.”
Number 3 – Senior management also must demonstrate its commitment by chipping
in and providing quality guest service as they move around the property. They are
employees, too, and guests look to them for assistance, Baird notes.
Number 4 – When employees see their general manager smiling, greeting guests,
helping them with questions and cleaning up, they know guest service is a
permanent culture at the property, not a passing fad, Baird says.
Number 5 – When everyone in the casino works together to create a great
experience, guests take notice. They appreciate those efforts………………………
Date Posted: 25-May-2003

Seven Keys to Improving Casino Guest Service

by Martin R. Baird

I can’t walk into a casino without encountering a stream of management questions

related to guest service.
How do we improve our guest service? How do we make our guest service training
work? How can we build a long-term customer service solution? We can’t outspend
the competition, so how do we outservice them?
Casino executives who ask these questions are on to something. They know that no
matter what else is going on in the world, their guests always want one thing: a great
casino experience. Guests want an experience that is so wonderful and memorable
that it keeps them coming back even if they have less money in their pockets when
they leave.
Guess what? Good customer service and the outstanding guest experience that
comes from that also have an effect on your bottom line. Guests who enjoy
themselves will come back and play again.
Having said that, I want to pass along seven keys to improving customer service that
I’ve learned from years of helping the gaming industry. These seven keys will set you
on the right path to creating a customer service culture at your property and reaping
the rewards.

Key #1: Change is Difficult

For some reason, people in the gaming industry lose sight of the fact that change is
difficult. When I ask executives about getting players to try new games, they tell me
how hard that is to do. They give examples of how slowly players get around to doing
something new.
Players and employees are the same when it comes to change. Human beings do
not quickly accept change unless they experience a major event or have some other
good reason to change. Therefore, when you’re trying to develop a guest service
culture among your employees, you’ll find it won’t happen quickly or easily.
Some casinos think they can “change” their people by marching them through a
three-hour orientation or training session. Wrong! Change takes a high level of
repetition and it needs to be of interest to those on the receiving end. You must
identify what will motivate your people to perform the desired behaviors you’re
looking for. Yes, a very small percentage of your staff members will change just
because you ask them to. The challenge is getting a critical mass of employees to
see that this change, this guest service culture, is in their best interest. If it’s not
important to them, most will not invest the effort needed to change.
Developing a guest service culture is an evolutionary process.

Key # 2: It Starts With Hiring, But That Is Not Enough

All casinos work hard to hire the very best candidates to fill job openings at their
property. Unfortunately, that’s just the beginning. Hiring the very best is a great place
to start, but it simply isn’t enough. If hiring the “right” person was all it took, there
would not be a multibillion-dollar training industry. A company invests in training
because it needs and wants more out of its people.
All of us face budget crunches on an ongoing basis, but what is your budget’s
alternative to training? If you’re like most properties, you don’t have a choice. You
find and hire the best of the best and they still need improvement.
Just for fun, take a day and look at the amount of time and energy you spend hiring
people. Now look at what it would take to turn your employees into truly great guest
service ambassadors. It’s much better to invest in training than it is to throw money
out the window hiring people and then firing them for not providing the level of guest
service that will allow you to compete.

Key #3: All Training Is Not Created Equal

Isn’t it odd that people will spend $30,000 for a specific automobile because they
recognize the quality of the brand but when it comes to investing in the growth of
their employees through training, they shop it based on price alone?
Don’t get me wrong. I have no problem with going to a discount store and buying
paper towels and napkins. That, to me, is good business sense. But I would not buy
something as critical to my overall success as the guest experience and purchase it
on price alone.
Automobiles are not created equal and the same goes for training. I’ve attended
training sessions that did not use the principles of accelerated learning and within 10
minutes I was looking for the escape hatch. I couldn’t stand it. It was boring and slow
and those were the good points.
Learning 101 dictates that people learn when they say it and do it. Unless you’re
trying to teach your employees how to sleep, the training needs to have more
interest. People retain new information the least when all they do is listen to a lecture.
You need to invest in training that makes the experience fun, that encourages
participation. The trainers also need to know the industry. They should understand
that most gaming employees only make money when they offer their guests a great
experience. I’ve heard hundreds of stories about casino employees getting tokes
from people who were losing money. Employees know that they will not always be
compensated for their efforts. But they know they will win over time if they put in a
consistent effort. Good training gives them the skills they need to make that effort.
After all, this is the entertainment business and if your employees are not part of the
entertainment, your guests will make the choice to spend their dollars elsewhere.
You should also hire a company that specializes in customer service training for the
gaming industry. Some casinos say they have one of their other vendors provide
guest service training. That’s shocking because these are the same people who
would never consider opening a window with a brick.
Companies that don’t specialize in customer service training can help you reach an
outcome. It may not be the exact outcome you desire but they will help you to a point.
The problem is they don’t always leave things in the best condition. A brick will open
a window. The cleanup may not make it worthwhile, but the window will now be open.

So why would you trust your guest service needs to a company that doesn’t
specialize in guest service consulting for the gaming industry? If you need to improve
guest service, don’t grab the closest tool or hire the most available company. Invest a
little time auditioning to make sure you find the best solution for your guest service
needs.
Coming up next month: keys four through seven (The Fun Factor, It’s An Investment,
You Need to Start With An Accurate Perspective and People Are Not Born With the
Guest Service Gene).

Key # 4: The Fun Factor

In Key No. 3, I mentioned that you are in the entertainment business. It’s important to
realize that your guest service training needs to be entertaining, too. Most people
think training is a form of torture. It doesn’t have to be that way. If people are not
having fun, it’s very difficult to get them to listen and pay attention.
Think for a moment about children and their ability to watch cartoons for hours. They
smile and laugh. They’re riveted to the TV. If you asked them to tell you about the
cartoons, they would remember them in vivid detail.
The reason these children remember is because of the fun factor.
Several years ago, I had the wonderful opportunity to work with a gentleman who had
invested a good part of his life helping the people who produce the Sesame Street
children’s show. He showed them how to develop lessons and taught them about the
child’s learning process. He focused on accelerated learning, a technique that makes
training so interesting and fun that people can’t help but learn.
Learning IS fun and if you start customer service training with that premise, you will
increase both retention and application. If you learn only one thing from reading this
column, make it this – add more fun to your training.

Key #5: It’s An Investment

I know training can cost a significant amount of money. It can be the equivalent of
several salaries. But you need to view training as an investment. With training, you’re
investing in your people and in the opportunity to generate more revenue for your
property. If you invest in your people, it helps both them and you.
Studies show that most employees want to be recognized and appreciated and that
they rank these two items much higher than pay. By investing in your employees with
training, you’re recognizing them and showing appreciation. You’re telling them and
showing them that they are important to your success and that you want to enhance
their value. If done correctly, you’re also giving them tools they can use to make
more money the next time they start their shift.
There’s another investment to consider, the fact that improved service and a better
guest experience can increase your property’s play and, ultimately, its profits
because those factors encourage guests to come back. It can be eight to 10 times
more expensive to get a guest to visit once than it is to get them to return. Many
properties use frequent player cards because they know they’re building a habit for
some of their customers. The sooner that happens, the sooner they can save a little
on marketing and increase profits.
I hate to say this, but all the wonderful marketing in the world will not and cannot
make up for poor guest service. People have too many entertainment choices. They
don’t need to come to your property. Even if you’re the only game in town, people
now have the choice of online gaming. They don’t even have to leave the comforts of
home.
If you could improve your guest service and get 10 percent of your visitors to play
one hour longer, how much would that contribute to your bottom line? If you could
invest $100 and generate $200, would you do it?
Improving your people and improving your guest experience is a simple investment.
You add hotel rooms or restaurants so guests will stay and play longer. That is the
same as a wise investment in great training.

Key #6: You Need to Start With An Accurate Perspective

I’m disappointed by the number of gaming venues that really don’t know what their
guests want. Management will tell you they understand their guests, but all their
information is second-hand or biased by their experiences. For example, some
people in management think employees always smile. Of course they smile when a
boss walks by. Or they see only the negative because that’s what they hear from
guests. They get feedback from guests who are upset and hear nothing from those
who have a great time.
Creating a guest service culture at your casino involves change and in order to start
that very challenging process of change, you need to have an accurate, unbiased
view of where you are today. You need to know what your guests really see and
think. An insider’s point of view is not nearly enough. Do a 360-degree evaluation so
you see things from the guest’s perspective, from management’s viewpoint and from
the employees’ standpoint. When you do this, you have a clear view of what is really
happening.
If you don’t start with this perspective, you are doing training or trying to improve
service based on fiction. If I were going to invest a significant portion of my budget on
improving service, I would want to base my investment on honest, unbiased
observations.

Key # 7: People Are Not Born With the Guest Service Gene

Wouldn’t it be great if you could do a simple test to find out if the person you’re about
to hire has a great guest service gene? It could save all of us some big hassles.
Unfortunately, there is no such gene. Good customer service is not born, it’s built
over time with great training.
The few people who do it naturally simply see how great service works, and they like
the way it makes them feel when they help a guest. But most people are not so
blessed. Most people don’t see how service affects them. They don’t see that they
can keep their job and make more money if they provide better service. I’m surprised
at the number of gaming staff members who don’t understand that they’re
commission-based employees. They live for tokes and the higher the level of service
they provide, the better the chances they have of getting great tips.
So if they’re not born with the gene, you need to provide training that’s fun and
interactive. You need to offer training that shows them that they and your company
will be rewarded if they adopt these new, better behaviors. I’m talking about learned
skills that are an investment in your employees’ future.
Now you have the seven keys to improving customer service. Guest service is an
unending battle that your property faces every day. There will always be a newer,
bigger gaming venue, so how will you compete? Will you try to fight the never-ending
battle of outspending your competition or will you outservice them and win customers
that way?

Date Posted: 01-Dec-2002

Casino Customer Service Is the Key to Success
by Martin R. Baird

“Don’t worry about profits, worry about service.” Thomas Watson Sr., founder of IBM.
I can’t think of a better quote for the casino industry today. It says it all! Too often,
businesses lose sight of what is important or even critical to their long-term success –
stellar service.
In the years that I’ve been working with the gaming industry, I’ve seen it explode with
growth and the competition that comes with that growth makes guest service more
important than ever. For example, I live in the Phoenix area and the changes to the
Native American gaming market there have been staggering. It has gone from a
couple of small, smoky, crowded card rooms to huge, beautiful casinos that offer just
about everything. They have top-name entertainers and wonderful promotions.
These casinos are some of the nicest looking buildings in the state.
Here’s the new challenge: how do they and other Native American casinos across
the country compete to keep people coming and ensure their continued success?
At one time it was OK to live in the world of “build it and they will come.” But those
days are going, going, gone! So how will casinos win the battle for guests? Recently,
the answer to that question was to add more amenities. Many casinos opened RV
parks, golf courses, fine-dining restaurants, resorts and more. But I seriously doubt
casinos can just keep building bigger and better as a way of attracting more guests.
The answer will come down to guest service. For casinos to grow and prosper in the
midst of increased competition, they must provide a better guest experience. It is not
enough to have the newest games. All the other casinos have them, too. The way
that casinos are going to stand out is through better service and that will require
employee training.
When I meet with casinos about their guest-service needs, I always ask, “Is the
management team committed to guest service?” This question is critical because
management commitment simply must be there. If it isn’t, none of the service-related
training will work. The casinos that have the most success at building a guest-service
culture are those that do it from the top down and the bottom up.
When the GM participates in the training along with hourly employees, it sends a very
strong message to all of the people that this is important. When each person from the
management team participates, word gets out that this is a mission, not a one-time
event.
Once you have the management team on the customer-service fun bus, it’s time to
get all the other employees on board as well. It’s important to note that I do mean
ALL of the employees. It’s not enough to train only the people who have direct guest
contact. Many casino employees who do not interact with guests do have contact
with other employees who, in turn, have an effect on the guest’s experience. If
customer service is the key to success, you can’t afford to have any weak links.
Everyone must be on the service bandwagon.
So why should casinos make the investment in guest-service training? The answer is
very simple: some employees don’t know how to provide great service and they don’t
understand how important guest service is.
Think for a moment about the number of employees you have who had not worked in
the hospitality industry before you hired them, those who have never really
experienced great service. If a person has never experienced great guest service,
how can they be expected to provide it?
Learning how to give quality service and the act of actually providing it need to be a
fun process. Passing down an order that people will be fired at dawn if they don’t
have fun at work doesn’t build a very good attitude for the troops. Customer service
and customer- service training need to be truly fun and interactive.
This is important for two reasons. First, people learn and retain more when they have
fun. If it’s the same old boring training, people will just zone out. Second, if you create
an understanding that guest service is fun, people are more likely to do what is fun.
After the training, it’s important to have a system in place that provides unbiased
evaluation and feedback on your guest service. Once a person learns a new skill, it’s
very important that they use it and develop the positive habit. If you have an incentive
program that’s tied to guest service, people are more likely to provide better service.
If your employees know that they could get an extra five dollars for smiling, your
guests will see more smiles. You need to give your employees the skills through
training and then reinforce them with positive rewards.
The casino business is not going away any time soon. And as long as it is not going
away and casinos are making money, competition is going to increase. This makes
guest service more important every day! ……………………………. Date Posted: 28-
Jan-2002

TABLE REWARDS - DESIGNING A LOYALTY PROGRAM

by Andrew MacDonald

TABLE REWARDS - DESIGNING A LOYALTY PROGRAM

PART I

Recently I had the opportunity to build a table game loyalty program called Table
Rewards. The basic idea behind any casino loyalty program is to make players feel
good about their purchase of an intangible product, namely, the gambling
experience. Having lost $500 gambling, a player “needs” to feel that they have
received something in return. In the old days, the benefit returned to a table player
was based on the knowledge of the player by a host or a pit boss. This benefit or
“comp” might have been a free meal, room, show or round of drinks.

As the size and complexity of gaming operations grew, this early benefit system was
replaced with computerized systems that enabled the capture of information such as
the player's buy-in, average bet, time played and win or loss. Calculations could then
be made on the earning potential from the player and a policy applied on how much
of that could be returned in benefits. This meant that a player no longer had to rely on
the particular relationship they had with a casino staff member but rather knew that a
consistent approach was being applied across various shifts and from visit to visit.
These same principles were applied to slot programs with great success. Slots
though had a great advantage. Firstly, they captured all information electronically and
so the play history was "pure". Secondly, this was updated in real time, as the player
was playing, not at the end of a session. Thirdly, slots could communicate to the
player, via electronic messages what they were earning as they played and what
their total accumulated “point” balance was.

Unfortunately, for table games most of the above is still not true. We still rely on table
game staff to guess a player's average bet, input the time played and estimate the
player's win or loss. This isn't updated until the rating is entered into the computer
system (in some casinos the next day) and this value is hardly ever communicated to
the player. The challenge therefore for us with Table Rewards was to create a benefit
system for table games that was easy to understand, overcame the above problems
and provided the players benefits that they actually wanted.

One of the first critical issues we identified was the lack of clarity in previous table
reward systems. How many dealers anywhere in the world can actually tell a player
what benefits they are earning and how they can use these within the property? The
better communicators might tell customers the system is based on theoretical loss
but then have difficulty explaining what you might expect to lose. So the first phase in
designing our reward program for table games was to establish how to define tables
into categories. And since players understand the game type and minimum bet for
the game they play, we broke our table games into four levels:

Level 1. $1 Roulette, $5 Blackjack, $2 Big 6 Wheel, $2 SicBo

Level 2. $2 Roulette, $15 Blackjack, $5 Big 6 Wheel, $5 SicBo, $5 Baccarat, $5
Caribbean Stud, $5 Craps

Level 3. $5 Roulette, $25 Blackjack, $25 Baccarat, $25 Caribbean Stud, $25 Pai
Gow

Level 4. $10 Roulette, $50 Blackjack, $50 Baccarat, $50 Pai Gow.

The other readily definable quantity understood by guests is time. The longer a
player plays, the more they should earn in benefits. For the design of our Table
Rewards, time was broken into ½ hour units. Then, of course, we needed to
understand what an average player theoretically lost per ½ hour unit at each level.
For level 1 players this was $5, level 2 - $10, level 3 - $25 and level 4 - $50.

Next, we knew we needed a framework to determine at what rate you should reward
players. Are all players equal and therefore should earn the same percentage in
benefits or do you want to look after your more valuable players who played on level
3 or 4 tables for longer periods of time? Then we knew it was critical to have a
reward program that was easy for our guests to understand. The simplest unit is
cash. People might be used to points but they understand cash. But we also didn't
want the cash benefits walking out the door, so we created "Casino Cash". Casino
Cash is essentially internal currency that can be used in any outlet in the facility on
the purchase of any product.
To make this even more powerful, the product we knew they liked and were
purchasing most was gaming. So "Casino Cash" could be used to buy chips. Not
cash chips though, as again the money might walk out the door. "Free Play" chips
can be used on any game on any bet but can't be cashed out. They have to be
played. When a Free Play chip wins it is paid in cash chips.

So our "Casino Cash" lets players choose exactly how, when and where they will
spend their rewards.

How do they get their "Casino Cash"? Accumulated and stored electronically on the
database in their player account, which can be accessed, at any retail outlet or
casino cashier. All computer systems are interfaced to make it easy for the customer
to access their rewards.

Also in the design phase we knew we wanted our players to play more during off
peak times (for a locals casino, like ours, Monday to Thursday) and to play for longer
than our "normal" 2 hour average. So incentives were incorporated with double
"Casino Cash" earned in off peak periods and a "Random Cash" award for playing 3
hours.

Effectively, with Table Rewards we succeeded in creating a simple system having

benefits skewed towards off peak periods and incentives provided for longer playing
times.

An easy to communicate and understandable system with real rewards that players
want. What more could you ask for? Table Rewards!

Date Posted: 02-Dec-2001

CASINO CUSTOMER SERVICE TRAINING FOR TABLE GAMES STAFF:

by Vic Taucer

CASINO CUSTOMER SERVICE TRAINING FOR TABLE GAMES STAFF:

We offer a great deal of training under the customer service label, all designed to get
more interactivity in table games with the customer…
Maybe its time to change tacks here, if the result is interactivity lets try:

SALES AND MARKETING TRAINING FOR TABLE GAMES STAFF!!

How much time, effort and money do us as casino operations put into customer
service training? A relative figure I guess, depends on the property size, the
objectives, the area and so forth. Whatever the amount is in time and money, I am
sure it is a large figure. From what I am seeing, at least when it is in reflection on the
Table Games side of our business, we are sure wasting a lot of money! You are not
getting what you need in table games from most of the casino customer service
training being offered out there!

Whoa, take it easy out there all you trainers who are delivering customer service
training currently! All you in-house training personnel or all you professional trainers
that works as consultants brought in by casinos, take it easy! I am not saying that you
are not delivering the goods. Most who offer customer service training in casinos are
formidable in their presentation skills, content and viability of the customer service
training product they are presenting. All (for the most part) offer a great customer
training program.

The problem is simply this. In delivering any form of customer service training
program to Table Games staff, the normal generic type customer service courses
that are delivered industry wide are having little, sometimes no effect on dealers or
supervisors in table games! Table Games staff generally do not buy into generic type
customer service training. Unless the material and presenter create some kind of
relativity to table games, dealers and supervisors aren’t going for it!!

The problem with customer service speakers and presenters that try to work with
casino groups is the audience (dealers and supervisors) does not buy into the
program. They see the speaker and his thoughts on customer service to have no
relativity to them because “what does this speaker know about the casino business?”
The presenter of this casino customer service program must be “one of us”, so to
speak to create the relativity needed to make inroads in this vein.

A great many of the standard if you will customer service programs are not table
games relative. Most are the same, a lot of touchy-feely customer service topics
presented generally by using a bunch of acronyms to relate to basic customer related
tasks. You know like C.A.R.E or A.C.T or any of the many of these. All deliver a
message generically speaking customer service wise. Table games staff react
differently to these acronyms, not positively. How do these acronyms and cute
sayings help me interact with customers better in a gaming environment? Dealers
(being primarily wise-guys) don’t see the relativity.

Even worse is when the presenter of these type programs gives their background to
the audience. When they find out that the presenters background is from the hotel
industry for example or even worse from retail, the turn-off is even more dramatic.
Your table games dealer says to himself, “Great, I have to sit through another all day
customer service program where the presenter is from Nordstrom’s Department
store! What does this person know about my job? While some of these programs are
really fun and interactive is the goal of the training to entertain the staff?

Interactivity between the staff and the players is the ultimate goal in table games. The
results of any training of this type have to be more time on game by the player with
an increased tip rate by the dealer. The old standard customer service training isn’t
working here!

I am not addressing eliminating basic customer service training. I am saying that the
problem is we need to train our dealers and supervisor in not just simply customer
service traits but we need to deliver training in player entertainment, communication,
sales and, marketing. I am speaking of a new type customer service program that
trains the dealer to market our product better by entertaining the customer.

Maybe place less emphasis on training for basic customer service traits (we better
already get this concept!), how about a different type customer service related
training….

SALES TRAINING FOR TABLE GAMES STAFF:

THE DEALER AS SALESPERSON!

We are at the point in casino world today where we need to make some kind of
concentrated effort to train our table games staff in sales and marketing. That’s right;
I said you need to train your dealers and floor supervisors to be sales people. You
have to train your staff on how to market the product. That generic customer service
stuff is basic and mandatory, it is a given.

We are in the entertainment business, the casino entertainment business. Dealers

are entertainers (how many times have I said this one!), more so than factory
workers. To win the audience, the staff in the casino must get the audience to like
them. Just like an entertainer, they must sell themselves and their personality to the
audience!
With so many casinos and so many table games available, you can’t expect volume
to increase or even stay constant. There are more casinos and tables than there are
qualified players. Too many games and not enough players mean only one thing:

You better train your people in table games to sell the product better!

In table games the product isn’t only the game. In table games, the product is also
the dealer or the supervisor, especially if this person is a tip earner.
In table games, the staff has to be trained in how to sell themselves (and the games)
to the player. We can’t just put the games on the floor and hope they sell themselves.

The problem is we do not deliver this type of training to our table games staff. I am
not talking about that requisite customer service training you offer your staff. That
training (smiling, greeting, etc), the basic customer service stuff is mandatory just to
get them to the door. If your staff is not at this point yet your casino is in a world of
trouble anyway.

I am talking about here is actual sales and marketing training in a customer service
based content for your staff. Sales training to consist of:

1. How to sell the product*

2. Communicating with the customer
3. Developing interactive skills just like sales people.

If the whole idea of table games play is based on the social activity part of this form
of gambling, maybe we have to train our staffs in social interaction with an emphasis
on sales. In table games the players have to like the atmosphere and especially the
staff if we expect them to play in our casinos for any length of time. Maybe we have
to train our staff in how to get the customer to like them. Isn’t that sales training?
This whole thought process makes me think of other businesses and the methods
they use for this type training. I have been around other businesses that use
seminars, courses and books, all designed to train how to make people “like you”, in
a sales related concept.

Our table game staff, dealers and supervisors, spends 100 percent of their time in
direct communication with your table games players. Yet this group gets no training
on how to effectively communicate with the customer in a sales context. Isn’t this a
little strange? What’s the matter; don’t we want them to sell the product?

Some casino operators are frightened by this thought. They say that if we give this
type training the dealers that their tip rate will increase. Well you know what, that’s
the idea here. Their tip rate will increase, so will your drop!

Over the last few years I have been delivering a number of training courses to my
casino clients. Predominantly table game related, my training courses are defiantly
need based, meaning I try to design training to meet the needs of my respective
casino client. By far the biggest need I see in casino world today is communication
training with a sales emphasis for table games staff.

I produce a course and have for years called The Dealer as Entertainer. While this
course is labeled at times a customer service course or thought process, it is much
more than this. The program addresses how to communicate with the customer and
to sell the product to the player in an entertaining form. In table games the product is
two fold and both must be sold. In table games the product is the game. In table
games the product is also you, the casino dealer or you, the casino floor person.
Maybe I will change the name of the program to The Dealer as Salesperson…that is
what this course really is!

In this customer service concept, maybe we need to go beyond the generic customer
service training that we lump everyone through. To get a better effect in Table
Games, let’s take this customer service training concept in another direction.
Customer service in table games is all about interaction between the staff and the
customer. Let’s label this as what it is and make the training more conducive to this.
It’s all about the sale!

Date Posted: 13-Sep-2006

Physics, Psychology and the Casino Industry

by Steve Karoul

Physics, Psychology and the Casino Industry

By Steve Karoul

We are very fortunate to have a lot of very bright and creative people on our team
here at Foxwoods. Ken Perrie, one of our Shift Managers, is one of them. He always
challenges me with unusual questions which I enjoy. At a recent meeting, we had an
interesting discussion about gamblers behavioral habits and the way certain players
develop some very unusual gaming habits. This caused us both to wonder why?

The next day Ken came to my office with a big file of information about physics and
psychology. My first reaction was that you don’t have to be crazy to work here but it
helps. The first question that he asked me was if I was familiar with Newton’s Laws?
Newton was one of the world’s greatest physicists. Newton developed a number of
Laws such as the Law of Inertia which states that a body at rest and a body in motion
continue to move at a constant velocity unless acted upon by an external force. Ken
related this to a Roulette ball spinning or the tumble of the Dice. There are players
out there utilizing these laws to their benefit on the game. He associated this with his
theory on casino cheating.

The next question Ken asked was if I was familiar with Charles Darwin and his theory
of Natural Selection. Darwin was a 19th century biologist from England. He
developed a theory that would contradict the creation of man and imply that all
species derived from common ancestors through a process called natural selection.
Darwin found that organisms that die as a consequence of competition was totally
random which resulted in a well known phrase called “survival of the fittest”. It is an
interesting theory worth reading some day. Again, Ken related it to his own casino
industry survival of the fittest theory. Look at all of the recent consolidations. How
many casinos or casino brands have disappeared over the past few years? Just like
the dinosaurs that disappeared millions of years ago. In addition, we have all seen
our own casino dinosaurs retire only to be replaced by a new breed of professional
managers more familiar with marketing, accounting and finance.

Ken’s next personality was Sigmund Freud. I started my university studies many
years ago in Pre-Med to become a doctor. In fact, I wanted to become a psychiatrist
so I read quite a bit of Freud in college. Freud had a lot of interesting theories about
the conscious mind, the preconscious and the unconscious. According to Freud, the
unconscious is the source of our motivations, whether they are simple desires for
food or sex, neurotic compulsions or our motivations.

By now you are probably thinking that Steve Karoul is nuts. However, there is a lot to
be learned from Freud and other great thinkers. Being a Vice President of Casino
Marketing and being a psychiatrist actually have a lot of similarities and common
ground. If you don’t think so, I suggest that you take a few minutes and go on-line
and do a Google search of Sigmund Freud. You will find that Freudian psychological
reality begins with a world full of objects. Among them is a very special object called
the organism. A special part of the organism is the nervous system which has as one
of its characteristics a sensitivity to the organism’s needs. If you keep reading about
Freud you will eventually come to his theory on Life Instincts and Death Instincts as
well as Libido or the motivation to have sex. Ah, now you can better understand. We
all know that in the casino business that sex sells. Just take a look at the majority of
casino advertising or marketing and you will usually see a sexy woman or man.
Freud explains why. So, once again, psychiatry and casino marketing are quite
similar. Freud, like many gamblers, once said “life is not easy” which translates to
“gambling is not easy”. Yet life goes on and gambling goes on. Why? If you to read a
little more about Freud, you will find the answers to many of these questions.

Freud was a genius with many different theories that can be related to gambling. Do
a little additional reading and research and you will be surprised to learn more about
motivation and how you can incorporate many of these ideas into modern casino
marketing techniques. Another theorist named Carl Jung also has a number of
interesting theories that many modern psychologists relate to. It helps to understand
why people enjoy gambling and it also helps to understand how pleasure affects the
body and the mind. All of this new knowledge can help you to develop more targeted
casino marketing promotions thereby maximizing your marketing dollars.

I don’t want to sound too technical but I also want to stress that you don’t have to
reinvent the wheel when designing a lot of your casino promotions. However, it is
really helpful to have a basic understanding of human psychology if you want to
maximize the profitability of your promotions. For example, are you familiar with
another great psychologist named B.F. Skinner? Skinner’s theory involved “operant
conditioning” and “reinforcing stimulus”. In operant conditioning, “the behavior is
followed by a consequence, and the nature of the consequence modifies the
organism’s tendency to repeat the behavior in the future”.

Imagine a rat in a cage. This special cage is called a “Skinner box” and it has a bar or
pedal on one wall that, when pressed, causes a little mechanism to release a food
pellet into the cage. Imagine the rat running around the cage, doing whatever it is
that rats do, when he accidentally presses the bar and, bingo, a food pellet drops into
the cage. The operant is the behavior just prior to the reinforcer, which is the food
pellet. In no time at all, the rat is furiously peddling away at the bar, hoarding his pile
of pellets in the corner of his cage. There are two Skinner theories that are relevant.
The first is “Random Reinforcement”. Skinner found that by changing the interval
between rewards that his test subjects (the rats) would keep hitting the pedal and not
stop. Does this remind you of a slot machine? The second theory is a Fixed Ratio
Schedule. This is nothing more than what we do with our player rewards programs or
comp guidelines, i.e. play four hours with an average bet of $100 per hand and we
will give you a free room.
Skinner’s research actually gets much more involved and much more interesting.
Skinner discovered his “Schedules of Reinforcement” by experimenting with
continuous reinforcement, fixed ratio schedules, fixed interval schedules and variable
schedules which all offered different reward frequencies and patterns of behavior.
According to Skinner, this is the psychological mechanism of gambling. You may not
win very often, but you never know whether or when you will win again. It could be
the very next time, and if you don’t roll the dice, or play that hand, or bet on that
number or pull that slot handle this once, you’ll miss the opportunity for the big win.
Can you begin to see some similarities?

Psychology is an interesting subject. There is a lot of good reading material available

on “behavior modification”. Basically the therapy technique is based upon Skinner’s
work. It is pretty straight-forward: Extinguish an undesirable behavior (by removing
the reinforcer) and replace it with a desirable behavior by reinforcement. It has been
used on all sorts of psychological problems such as problem gaming, addictions,
neuroses and even schizophrenia. By better understanding behavior we can better
identify problem gamblers and try to help them in the early stages of their problem.

A basic understanding of psychology is important today for the modern casino

executive. Much of what we do either drives business to our casinos or helps us to
increase market-share. Understanding what motivates people is a big help. In
addition, psychology plays a big role in our daily interpersonal relationships with both
our staff and our peers. Foxwoods Casino understands this and supports its
management team. Foxwoods has committed a substantial amount of money for
management development programs. All of their executives and tribal council
members have attended the Center for Creative Learning to attend their world class
Leadership Development Program. In addition, Foxwoods employs a professional
Psychologist and a Management Consultant to continually help their management
team further develop their skills. They spend a considerable amount of time on
Emotional Intelligence. All of their executives have taken numerous various
psychological tests such as MSCEIT, Meyer Briggs, Campbell Organizational
Survey, etc. If nothing else, everyone learned a lot about themselves and their own
personalities. The consensus is that the most interesting area is Emotional
Intelligence due to the fact that EI is usually one of the key factors to executive
derailment and failure. There are many good books available covering the subject of
Emotional Intelligence. It is highly recommend that you buy one and read about it. It
will be well worth the effort and the subject matter will help you both in work and at
home. Good luck.

Date Posted: 23-Apr-2006

Measuring Customer Experience

by Sudhir Kale

Measuring Customer Experience

By Sudhir H. Kale, Ph.D.

Casinos, like other service industries, have only recently emphasized the role of
marketing in achieving their strategic objectives. At a casino property with around a
billion dollars in revenues that I have consulted with, over 25 percent of the revenues
are spent (invested?) in marketing activities. Having realized the importance of
attracting and retaining valued customers, many casinos are conducting periodic
surveys to assess how satisfied their customers are with the various touch-points
within the casino resort.

I have a piece of bad news for you. Such surveys could be an enormous waste of
time and money, and could even lull management into a false sense of customer-
centricity. But the good news is that you can avoid such waste if you read, reflect,
and act on what is said in the following paragraphs.

Satisfaction or Quality?

Most casinos try to assess customer experience through the level of satisfaction
reported by a customer. This serves to be of little value. Numerous studies have
shown that customer satisfaction alone does not ensure that you are going to retain
your customers. There is a wide chasm between customer satisfaction and customer
loyalty. When tracking repurchase loyalty, one car manufacturer was dismayed to
find that although 90 percent of its auto users described themselves as "satisfied" or
"very satisfied" with their vehicles, the repurchase rate hovered only around 30 to 40
percent. As the loyalty aficionado Frederick Reichheld points out, "Companies can
avoid the satisfaction trap if they remember that what matters is not how satisfied you
keep your customers, but how many satisfied and profitable customers you keep."
Don't confuse the two, otherwise the exit doors of your property will be lined with
thousands of seemingly satisfied customers.

It makes better sense to measure quality of the customer experience you are
providing. The difference between satisfaction and quality is not merely semantic.
Satisfaction relates to a single transaction and is consumption-specific. For example,
I may be very satisfied with the Pollo Alla Francese that I order at Foxwoods’ Al
Dente restaurant. My experience with Foxwoods, on the whole, could still be
negative. My satisfaction relates to a single transaction and this provides little by way
of insight into my attitude towards Foxwoods as a whole. It could even be that I had
heard terrible things about Al Dente from other customers and this formed the basis
of my low a-priori expectations about dining at Al Dente. Having these expectations
disconfirmed was what resulted in my pleasantly high level of satisfaction. The high
satisfaction, therefore, may not have a whole lot to do with Foxwoods’ service quality
even in regard to Al Dente.

While perceived service quality is a global judgment or attitude relating to the

superiority of the service, satisfaction is related to a specific transaction. Services
research is replete with incidences where people are satisfied with a particular
services provider but did not perceive the service firm to be of high quality. If you feel
that customer loyalty and retention are the bottom-line drivers, then satisfaction is
indeed a poor if not dysfunctional surrogate for measuring these constructs.

Linking Specific Items to Overall Satisfaction

Most customer satisfaction surveys I have seen capture the customers’ assessment
of various experiences at the property (food quality at the various restaurants,
cleanliness of rooms, friendliness of valet staff, etc.) These are then linked to the
overall measure of customer satisfaction to determine whether each individual item is
a key driver of overall satisfaction.
Consider the extreme example of a casino that does quarterly satisfaction surveys
and reallocates existing resources based on key driver analysis.

Service/Product Satisfaction Quarter 1 Key Driver Status Quarter 4 Key Driver Status
Beverage Service on Casino Floor No Yes
Mix of Table Game Limits No No
Cage Services No Yes
Mix of Slot Game Types No No
Parking Facilities Yes No

If management erroneously decides to reallocate resources based on the first quarter

satisfaction results, it may choose to reduce the number and training of the cage staff
or casino floor waitresses in order to free funds for enhancing parking facilities. Such
resource reallocation yields a completely different set of drivers in the fourth quarter.
Since the cage and F & B staff was cut back and not as well-trained, waiting time at
the cashier’s increased, and customers naturally became less satisfied about this
aspect of their relationship with the casino. In all probability and on numerous
occasions, they walked away from their Blackjack table because they were tired of
waiting for the beer they ordered an hour ago! In fact, the dissatisfaction was
sufficiently acute to affect overall satisfaction. This example underscores the dynamic
nature of key drivers and the need to focus on more robust measures for evaluating
customer experience.

Measure Drivers of Service Quality

Parsuraman, Zeithaml, and Berry, eminent scholars in services marketing, have

identified five key aspects of service quality. These are tangibles (the appearance of
facilities, equipment, personnel, and communications material), reliability (the service
provider’s ability to perform the task dependably and correctly), responsiveness (the
service provider’s willingness to help customers and provide prompt service),
assurance (knowledge base and courtesy of employees and the level of trust and
confidence they instil), and empathy (the level of caring and individualized service
provided).
These five dimensions will drive customer perceptions of service quality across
touch-points. Even more noteworthy, they point to specific areas in which the casino
may be underperforming. A periodic review of customer perceptions along these
dimensions will ensure that the gap between the quality of service delivered by the
casino and customer perceptions of what they think should be delivered is constantly
and systematically reduced.

Epilogue

W. Edwards Deming, the quality guru wrote, “…it will not suffice to have customers
that are merely satisfied. Satisfied customers switch, for no good reason, just to try
something else. Why not? Profit and growth come from customers that can boast
about your product or service –- the loyal customer. He requires no advertising or
other persuasion and he brings a friend with him.”

Customer satisfaction surveys seldom provide any insights into customer loyalty, the
“brass ring” of business. Understanding the customer experience is vital, if not
indispensable to the long-term profitability and growth of casinos. Instead of pouring
money into the coffers of well-meaning but conceptually unenlightened market
research firms to obtain customer satisfaction ratings, you will be better off investing
in sound instruments that track service quality. Casinos are in the business of
destination-based entertainment, and the quality of experience they provide will alone
determine how much sustainable competitive advantage you have.
………………………..Date Posted: 26-Jan-2005

4P FRAMEWORK FOR CASINO SUCCESS

by Sudhir H. Kale, Ph.D.*

4P FRAMEWORK FOR CASINO SUCCESS

By Sudhir H. Kale, Ph.D.*

Have you heard about the 4Ps in discussions on marketing? Of course, you have. I
can already sense shudders among my dear beloved readers. Not to worry. This
article is not another one of those “Death By PowerPoint” lectures that talks about
product, price, promotion, and place. Speaking of these four Ps, a lot of marketing
professors, students as well as practitioners credit this framework to my friend Philip
Kotler. In reality, it was Jerry McCarthy who first spoke of the four Ps when
discussing the domain of marketing.

The 4P framework I would like to discuss is “Property Positioning for Profitable

Performance.” With the competition in the gaming industry intensifying, how you
position your property could make the difference between success and failure, life
and death, growth and stagnation. In making such bold claims, I may be getting
ahead of myself. Let us first define what we mean by positioning. Quite simply, a
brand position is the place your brand occupies in the mind of your target market
relative to competitive offerings. In deciding which newspaper to read, which tomato
ketchup to have with fries, which car to drive, and which casino to frequent, all
customers use their “perceptual maps,” plot diagrams in the head representing the
perceptions of positions of the various brands they are aware of. If a customer is
buying a toothpaste in a supermarket, her mental map will tell her to buy Crest if she
is concerned about cavities, and Close-Up if she values fresh breath.

I have asked the following question of casino marketing directors and general
managers scores of times, “What is your property’s positioning statement?” Many
times, my question is greeted with a look of baffled embarrassment, particularly on
the part of executives at some of the smaller casinos. Yet, positioning is as critical to
your marketing program as your company’s mission statement to its survival and
future direction.

Your casino’s brand position represents the key feature, benefit, or image that it
stands for in the collective psyche of your target market. Al Reis and Jack Trout,
widely acknowledged as the pioneering gurus of positioning write, “Positioning starts
with a product. A piece of merchandise, a service, a company, an institution, or even
a person. Perhaps yourself. But positioning is not what you do to a product.
Positioning is what you do to the mind of the prospect. That is you position the
product in the mind of the prospect.”

Positioning encompasses the central idea that captures your brand’s meaning and
distinctiveness vis-à-vis competitive offerings. It is your positioning that forms the
basis of developing all successful marketing communications. It tells you who to
target, what to say, and what media and message vehicles to use in delivering your
message. In their highly acclaimed book, Counter-Intuitive Marketing, Clancy and
Krieg (2000) argue that from both a strategic as well as a tactical perspective, the
positioning statement should be a short one, even a word. It should forcefully convey
the message “you want to imprint in the minds of customers and prospects.” It gives
the customer a reason to patronize your brand; it underscores how your brand is
different from, and superior to, the competition.

In his article recently posted on the MarketingProfs.com Website, “The Positioning

Statement: Why To Have One Before You Start Communicating,” Ford Kanzler writes
that a well-crafted positioning statement should be based on answers to seven
essential questions:

Who you are?ξ

What business you’re in?ξ

Who you serve?ξ

What does the target market that you serve need?ξ

Against whom do you compete?ξ

What’s different about your business?ξ

What unique benefit does the customer derive from your product or service?ξ

Answers to these questions should be based on collective inputs from all managers
who are interested and involved in key company activities—the CFO, CEO, and VPs
of marketing, sales, and customer service. If you are a casino-hotel, then both the
hotel side as well as the casino side of the business needs to be involved in this
exercise. And do not forget your prospective customers when it comes to providing
inputs, but more about it later. The desired result is a series of crisp positioning
statements and supporting messages that reflect the current reality of your business
and act as a guide in moving the company towards its “sought after, achievable,
differentiated position.”

Typically, you can position your property along one or more of the following
dimensions: price/quality, product-mix attributes, product user, product usage,
product class, competition, and symbol or icon. Regardless of the dimensions
chosen, the positioning statement should, ideally, result in a strong, clear, and
consistent image of your property in comparison with your competitors. This will allow
for product differentiation through a brand image. Meaningful differentiation will, in
turn, translate into brand loyalty, which means a greater share of customer wallet in
your targeted market.

Positioning starts out with a declaration to your customer, which then becomes a
reality or falsehood in her mind through accumulated experience. For the declaration
to become a well-imprinted reality, periodic reinforcement through marketing
communication efforts is essential. Positioning thus constitutes the backbone of your
marketing strategy.

Price/Quality: Many buyers equate high price with high quality. In the casino
parlance, this may equate with prices the casino charges for its hotel rooms, or the
table minimum for bets. Caesar’s Palace and Las Vegas Hilton probably have
established this position among Las Vegas gamblers.

Product-Mix/Attributes: “Good food specials and buffet,” and “good entertainment in

the bars,” are examples of positioning along attributes of the casino entertainment
provider. Circus-Circus and the Golden Nugget Casino in Las Vegas could be
positioned along these lines.

Product User: The representative user of a product can also be used to position a
brand. The Hard Rock Hotel and Casino seems positioned as a casino for “the guest
seeking a unique, hip and exciting experience.”

Product Usage: A product may be positioned on the basis of the way in which it is
typically used. The Crown Casino in Melbourne, Australia brags about its “world class
shopping and dining,” and its “luxurious and indulgent accommodation.” This
message conveys that Crown is not just a casino -- it offers more by providing the
amenities that are usually available at a top-notch luxury resort.

Product Class: It is sometimes possible to position a brand against another product

or product class. The Stratosphere in Las Vegas uses the following copy in
promoting its wedding chapel, “Imagine taking your vows of eternal love high
amongst the clouds in a chapel so unique, your family and friends will talk about it for
years. Situated 800 feet above the Las Vegas Strip in the Stratosphere Tower, your
chapel is higher than any other in the entire country.” In so doing, the property (or a
specific component thereof) is positioned against chapels and function halls, not
casinos. Another example of product class positioning is the way in which casinos in
Queensland, Australia position themselves against the various pubs and RSL clubs,
“Our slots pay more, it’s the law.”

Competition: Comparing, either directly or indirectly, a brand to its competition is

another form of product positioning. In a recent lead article in Gambling, Michael
Shackleford provides a comprehensive and credible comparison of Las Vegas reel
slot returns. The Palms Casino had the highest payout on nickel slots — 93.42%
against a median of 91.7% payout. Palms Casino could use these statistics in
positioning itself against other casinos in Vegas.

Symbol or Icon: Companies sometimes use a symbol or an icon to position

themselves in the minds of consumers. Over time, this symbol can become
synonymous with the company or brand. Thus, the “golden arches” have come to
symbolize McDonalds and “big blue” is tantamount to IBM. Paris Las Vegas uses the
Eiffel Tower as its icon in all its marketing communication, even on the shampoo
bottles in its hotel rooms. The hope is that with the passage of time, most consumers
will have a clear image of the casino by merely seeing the symbol.

In choosing which dimension or dimensions will be used for positioning, the casino
should first identify the differences that might be established in relation to
competition. However, merely identifying the differences is not enough. The company
needs to isolate the most powerful differentiators from the perspective of the target
market. Once isolated, these differences then need to be forcefully communicated to
prospective customers. The image the company strives to create in the minds of the
target market needs to be constantly fortified with the use of symbols, through written
and audio-visual media, and through the physical atmosphere of the property.
Let us now look at the three common errors in positioning: confused positioning,
under-positioning, and over-positioning. Confused positioning arises due to an
uncertain mental image in the minds of customers due to multiple claims and/or
frequent repositioning on the part of the casino. For example, a casino cannot
position itself as “a casino for locals” one day and as “a good place for foreign
traveler” the next. Such contradictory claims are bound to result in confused
positioning.

Under-positioning is said to occur when your customers cannot identify anything

special about your brand. Such perceived lack of differentiation is often the result
when the differentiators chosen for positioning are not valued enough by the
customer or are not forcefully communicated to the customer. This was probably the
case with the Claridge Casino Hotel in Atlantic City.

Over-positioning results when a company positions itself too narrowly, resulting in the
buyers having too constricted a picture of the brand. Fewer customers will then be
attracted to the marketer’s offerings. For example, if a casino positioned itself solely
on the basis of its “good check cashing services,” it would probably be over-
positioning itself.

As the needs of companies, competitors, and – most importantly – consumers evolve

over time, your brand position may also warrant changes. This process of creating a
new image for an established brand in consumers’ minds is called repositioning. It
involves changing people’s existing attitudes and beliefs, and is therefore more costly
and more difficult than positioning a new product. Periodic assessment of your
brand’s position vis-à-vis the competition will indicate whether you need to embark on
an expensive and risky repositioning exercise.

Repositioning begins with as assessment of the brand’s current position. A decision

then needs to be made on the desired position the company wishes to own for the
brand. An analysis of the competitors who may be strongly embedded in this position
is then carried out so as to assess the chances of repositioning success. Factors
such as the aspirant’s monetary resources, tenacity, and creative strategy are also
weighed in to predict the success of repositioning efforts.

Finally, one last authoritative observation about positioning. Recall that positioning is
the place your brand occupies in the minds of your customers. When it comes to
deciding the dimensions on which to position your casino, the best source you can
possibly turn to is your target market. Al Reis and Jack Trout observe "The average
mind is already a dripping sponge that can soak up more information only at the
expense of what is already there. Millions of dollars have been wasted trying to
change people's minds… Once a mind is already made up, it's almost impossible to
change it." If you want to come up with a short list of effective and relatively
inexpensive positioning statements, the minds of your prospects may be the best
place to begin! Here you will find treasures of product benefits and imagery
associated with various brands that your customers already believe and accept. Your
chances of successful positioning or repositioning will be significantly improved if you
can understand how the various brands are stacked on those “little ladders” in the
heads of your target market. This can only be achieved through market research.

Now that you know my 4P Framework, it is your turn to let me know what your
casino’s positioning statement is. Let’s hear your justification of why you believe the
current positioning to be the best.
Date Posted: 01-Jan-2003

CUSTOMER SERVICE: DIFFERENTIATION ON THE SUPPLEMENTARY

ASPECTS
by Sudhir H. Kalé, Ph.D.*

Frederick W. Smith, Jr., invented the concept of overnight package delivery with the
founding of Federal Express in 1971. The company thought it had a unique service
that would thrive in a then protected market. However, much to Smith's chagrin, the
airfreight industry was deregulated in 1978 and several competitors stormed into the
market and quickly established themselves by performing the core activities of the
airfreight industry-pickup, overnight transportation, and next-day delivery-just as well
as Federal Express, at a fraction of the price. FedEx soon realized that it had to
rethink its definition of service if it wanted to continue being the market leader and
charging a premium price. After considerable thought, the company defined service
as "All actions and reactions that customers perceive they have purchased."

This definition underscores the concept that the service offering comprises of a
bundle of activities consisting of the core product, e.g., transporting packages and
delivering them to the addressee before a predetermined time, plus a cluster of
supplementary services like offering information, supplying labels and packaging
materials, taking phone orders, resolving occasional problems, and tracing missing
packages. Christopher Lovelock, a services marketing guru--suggests that managers
in the service industry need to first identify the various service actions and
interactions, classify them into core and supplementary service elements, and then
determine how well their organization is performing on each one--so as to get a
better understanding of their competitive advantage.

Such a classification of service offerings is of immense benefit to casino operators.

With maturing of the industry as a whole, gambling entertainment, the core product of
casinos, has become a commodity. With riverboat gaming, gaming on reservations,
and restricted gaming in parts of almost every state in the Union, Americans can now
gain access to the core gaming product with unprecedented ease. In order to gain
and preserve competitive advantage, casinos urgently need to emphasize
performance on supplementary aspects of the service offering. As Ted Levitt, another
marketing guru, observed almost three decades ago, "It is not so much the basic,
generic central thing we are selling that counts, but the whole cluster of satisfactions
with which we surround it."

So what is that 'cluster of satisfactions' when it comes to casinos? We first need to

address this question in order to have a better grasp of the supplementary service
elements in the context of the casino industry. The case of a typical casino has been
depicted in Figure 1. As can be seen from the figure, the core service element of a
casino is to offer gambling entertainment via machines, table games, sports betting,
and keno. Gambling being the raison d'être of casinos, every full-fledged casino
offers this core with little variation in quality across competitors. For a typical Las
Vegas customer, there is little difference in satisfaction when it comes to the core --
whether she gambles at Aladdin or whether she goes next door to Paris for a punt.
The 'supplementary service elements' is where one would expect to find considerable
differences across Aladdin and Paris. In the figure below, these supplementary
service elements have been classified according to the benefit they provide to
prospective customers. Such customer-driven classification is the key to sustaining
competitive advantage.

Figure 1: Core and Supplementary Services Offered By a Typical Casino

Core: Gaming constitutes the core of the casino service offering. The providers of
this core service include dealers, pit bosses, floor supervisors, and floor change
personnel. The courtesy, efficiency, empathy, and responsiveness of providers will
determine the quality of the core element of casino service. At the very minimum, the
core element needs to be of a quality that is uniform and consistent across shifts and
providers.

Supplementary Service Elements: There are ten main clusters of supplementary

services that a typical casino provides. While most of these services are mandatory,
a casino can offer other discretionary services, which would enhance its competitive
advantage. The supplementary services normally offered include hospitality,
payment, billing, consultation, order taking, safekeeping, security, transportation,
exceptions, and order getting. Several different departments may be providing an
array of services under each cluster. Our intent here is to classify these
supplementary services from the customer's perspective.

1. Hospitality is mainly provided by the hotel and F & B side of the casino. Casino
hosts would also be involved in the hospitality function.

2. Payment would be the domain of the cashier or the casino cage. Exchanging
foreign currency and cashing of customer checks would be included under payment.
3. Billing would be a function performed by the wait staff in restaurants and by the
checkout clerk in the hotel.

4. Consultation would involve offering advice on where to eat, which shows to see,
and which other attractions to visit. This would be the job of the concierge and, in
some cases, the casino host.

5. Order taking would be performed by restaurant wait staff as well as telephone

operators involved in making hotel and show bookings.

6. Safekeeping involves taking care of customer vehicles, baggage, as well as

valuables. Parking lot attendants, bellboys, the lost property office, and those in
charge of safe deposit boxes would be involved in the safekeeping function.

7. Security would primarily be the responsibility of the security staff. Security would
also be a factor in handling markers and conducting credit card transactions.

8. Transportation will be performed by limousine drivers as well as external agencies

involved in getting customers from one place to another. These could be public
transport agencies, monorail operators, and companies with which the casino has a
contract for the transportation of guests.

9. Exceptions, as the name suggests, would be a function of 'hotline engineers,'

those involved in fixing TVs, air-conditioning, heaters, slot machines, and so on.

10. Finally, order getting would be the critical function performed by those proactively
involved in getting guests to the casino. Agents, casino hosts, and others involved in
the casino's loyalty programs would be performing the order getting function.

The identification of these supplementary clusters helps management better

understand its roles from a 'customer benefits purchased' standpoint. It aids in an
executive's appreciation of the service offering from an augmented product
perspective. Lynn Shostack, a services marketing researcher, argues that the core
and supplementary elements of a service are not unlike chemical formulations: a
change in one element often alters the nature of the whole entity.

French researchers Eiglier and Langeard echo Shostack's analysis. Their

conclusions contain insights that casino operators need to internalise:

 The performance of each service cluster affects the perceived quality of all
others; all the supplementary services contribute to overall quality.
 Market research is needed to determine how a customer's overall satisfaction
level is split between the core and the supplementary or peripheral services.
 "Which peripheral services to offer" is a strategic management decision that
needs to be periodically revisited.
 An important decision must be made on whether to unbundle prices by charging
for each individual service or to offer everything (or most services) at one package
price.

Besides the ten clusters of peripheral services discussed above, there may be other
clusters of satisfaction or supplementary services that casinos provide. A good
starting point for identifying supplementary services is to develop a flowchart of
service delivery. Flowcharts clarify the sequence of the service delivery processes,
showing the steps that a customers go through from the point that the first contact
with the provider is made, through to leaving the casino or settling accounts.

Thus identifying an extended list of supplementary services and categorizing them

into groups, casinos have a well-ordered inventory of product augmentation
possibilities. The task now is to answer the following strategic questions: (1) Is our
organization presently offering a particular supplementary service? If so, how are we
performing on quality and value relative to customer expectations and competition?
(2) If we are not offering certain supplementary services, are our immediate
competitors doing so? Furthermore, do our customers expect these services or
would they appreciate our providing these services? (3) What are the inputs-
manpower, technology, and information-needed to offer each supplementary
service? What are the returns in terms of ROI for each service?

Conclusion

As an industry reaches maturity, the core product inevitably becomes a commodity

--offering few opportunities for differentiation. Value-creating supplementary services
surrounding the core cluster are often the only avenues for product differentiation and
competitive advantage. Casino operators should be aware of the strategic
implications of selecting the right mix of supplementary services designated as part
of the service offering. The need for synergy of the supplementary element with the
core can never be overemphasized. Customer research and an evaluation of
competitive offerings on the supplementary service aspects need to be conducted on
an on-going basis. This will enable casino operators to maximize the bottom line
impact of design and quality aspects of various supplementary elements. In an
industry wedded almost exclusively to theme-based differentiation, a thorough
analysis of all supplementary aspects would be a refreshing and much needed
detour toward differentiation.

Date Posted: 07-Apr-2002

Target Guest Entertainment Experience Delivery System

by Dean M Macomber

I. CONTENTION: A SYSTEMS APPROACH TO CREATING AND MAINTAINING

THE CASINO "PRODUCT" WILL PRODUCE OPTIMAL RESULTS

Gaming is a business. As a business, gaming has a product. The product is a set of

leisure time services, which includes, but is not limited to, gaming.

The goal for casino executives is to initially conceptualize and accurately align the
services with consumer needs, wants and expectations. Thereafter, the goal shifts to
consistently producing those services at predetermined target levels of performance.
The challenge is to achieve these goals in a business, which has a complex set of
production and consumption variables. One approach is to utilize a systematic
approach to conceptualizing the service and then a systems approach to produce
and maintain the service.

Not all organizations will be capable of taking a true and total systems approach to
the challenge. Standing in the way will be ingrained cultural objections, built-in
organizational impediments and/or limited financial resources (real or perceived). For
those gaming companies who choose to do so, however, the rewards could be
meaningful in both competitive positioning and raw financial terms.

II. DESCRIPTION OF "THE GAMING PRODUCT"

A. THE CASINO INDUSTRY AND THE PRODUCT IT "SELLS"

Casinos are part of the leisure time industry king to attract consumers discretionary,
disposable income. While gaming may be the focal point of a visit to a casino, the
gaming product has expanded to mean much more. Today, a gaming visit certainly
includes enjoying the roller coaster excitement created by the win-loss cycles at the
blackjack table or slot machine. But equally important, a trip to a casino also means
having dinner near a waterfall, vicariously engaging in the social spoil of people-
watching at a bar, seeing a high-tech pyrotechnic extravaganza, relaxing by a
Caribbean inspired pool or purchasing haute couture at a Romanesque mall.

The "product" which customers come to buy and therefore, what casinos sell is an
experience: a gaming related entertainment experience. It is the responsibility of
casino management to conceptualize, produce and deliver entertainment
experiences that meet the needs, wants and expectations of the guest at a price that
creates a perceived value. This responsibility does not exist in a vacuum, however.
Competitively this experience must be executed in a manner that results in the
business capturing its fair share, or greater than fair share, of the existing or future
demand. Under capitalism, the final test is financial. The experience must be
manufactured and sold at a ratio of costs to revenues that results in operations
meeting or exceeding target financial returns.

B. THE KEY ELEMENT TO SUCCESS - CONSISTENCY

Any product that is successful over the long term depends upon the initial alignment
of the customer's expectations for the product with the actual delivery of the product.
This evaluation extends first to the experience qualitatively ("Did I get what I
wanted?") and if that criteria is satisfied, second, whether the price paid for the
experience created a perceived value ("Did I get what I paid for?").

Thereafter, long term success is built upon generating a steady flow of new
customers and converting a target core group to loyal repeat customers. Admittedly,
such marketing programs as advertising and promotions can generate demand, but it
is far more effective to build demand upon a foundation of a solid, positive reputation.

Consistency is the key element to creating and maintaining both loyalty and a
positive reputation. The initial quality levels for opening day must be consistently
reproduced every day thereafter. It is this "average" experience that a customer has
with the business that determines reputation. Great companies are not generally
characterized by peaks of excellent product/delivery. Rather, they consistently deliver
a "range" of experiences that materially exceed the experience created by the
competition. Consistency is also important for the repeat customer because they
need to know that each time they visit they will have the same "great time" they had
on their first visit.

The challenge in a service industry is that a great deal of the production of the
experience is from human beings and thereby subject to an infinite number of human
driven variations each time the service is delivered. This is in stark contrast to the far
more predictable and precise machine produced products such as retail and hard
goods. Aggravating the situation is that no two customers are alike, each bringing
with them another set of infinitely variable expectations and valuation criteria. In fact,
the same customer may have different experiential expectations and valuation
criteria from one trip to another.

The first goal is to create a viable product/service. The second, perhaps more difficult
goal, is then to sustain the product/service to target levels. Finding a way to deal with
the production - consumption variables is the key to maintaining the all important
consistency.

C. GIVING STRUCTURE TO THE GAMING ENTERTAINMENT EXPERIENCE

The casino experience is "manufactured" utilizing a number of elements, tangible and

intangible. An impulse driven walk-in visit or an overnight vacation to a casino is an
experiential accumulation of contacts with the bricks and mortar, design,
environment, employees, products and services offered by the casino. The total time-
space continuum that defines each visitor- trip is actually a compilation of an infinite
number of contacts with the casino.

This stream of contact events has been referred to as the "service cycle", each node
on the cycle constituting a major service. Within each major service node category
are the services that comprise that category. Each service may then be then be
broken down into tasks, tasks into procedures and so on until the entire customer
experience is depicted by a model of all the elements which produce the customer
experience.

The ingredients which comprise the experience include tangible and intangible,
human and bricks-and-mortar/system elements, conscious and subconscious stimuli.
These range from the hard, tangible aspects of the service such as the mix of
services offered: quality of the food purchased and the types of slot machines put on
the casino floor; to the soft, intangible aspects such as employee courtesy, ambience
of the building and perceived chance of winning. And, despite our attempts to label
what is trying to be created, for certain casinos, there is an indescribable "x- factor"
that separates their experience from the others.

Wrapping around this multi-dimensional, experiential "cube" is the price (or cost) of
the experience. The consumer will evaluate price/cost of the individual service as
well as the overall cost of the experience to determine if they received value.

III. BEGIN WITH THE END IN MIND - DEVELOPING A TARGET GUEST

ENTERTAINMENT EXPERIENCE

The preceding discussion on what constitutes the gaming product is provided to

make the argument that the visitor's experience is comprised of a complex matrix of
elements, some of which are static while others are dynamic, variable and only semi-
controllable on both the production and consumption side of the equation. To cope
with such complexity, the contention is that to create a predetermined customer
experience in the first place and then to consistently maintain the quality of that
experience over time, requires a systems approach. For convenience, such a system
might be labelled a "TGEED System".

TARGET GUEST ENTERTAINMENT EXPERIENCE DELIVERY System

The definition of a "system" is a set or arrangement of things so related or connected

as to form a unity or organic whole. The system must not only produce the target
experience to preset standards, the system must also be capable of monitoring
results and self correct itself when sub performance is identified.

The primary components of such a system are:

1. Define the Target Guest Entertainment Experience ("TGEE"). |

2. Develop standards and expectations for the TGEE's.
3. Draft written policies and procedures that result in the delivery of the TGEE's to the
predetermined standards and expectations.
4. Develop hiring criteria that result in employees being hired who are best suited to
deliver the TGEE's.
5. Develop orientation, training and probationary programs designed to prepare the
employees to deliver the TGEE's on their first day of work and thereafter.
6. Develop monitoring and evaluation programs to identify when standards and
expectations are not being achieved.
7. Develop remedial programs that "recalibrate" the defect, be it an equipment,
supply, system or employee problem.
8. Develop sanction programs to purge the system of elements that can not be
corrected.
9. Develop reward/award programs that reinforce the goals of the system.

Each of the nine major components are major subject areas unto themselves. The
focus of this article is on the system, not each of the elements, per se. Nevertheless,
to understand how the system works, it is important to know how each element works
and contributes to the system.

A. DEFINE THE "TARGET GUEST ENTERTAINMENT EXPERIENCE" (TGEE)

Fundamental to the success of a TGEEDSystem is an explicitly defined Target Guest

Entertainment Experience. If the TGEE is left up to every employee's own definition
of what it should be, the inevitable result will be inconsistency.

Using an analogy, if we asked thirty employees to purchase a gallon of green paint,

undoubtedly they would return with thirty gallons of green paint. Equally likely,
however, is that they will bring back thirty shades of green paint ranging from
chartreuse to dark green. It is critically important to narrow this range into a spectrum
that is defined by the casino. Left to chance, the spectrum will be far too broad.

The definition of the TGEE must also be as explicit as possible utilizing both objective
and subjective descriptions. The definition should include both what the TGEE should
and should not be.

For the system to work, it is critically important that a TGEE be created for each
guest experience. In general terms, this means for the casino experience, beverage
experience, food experience, entertainment and recreation/relaxation experience.
These major categories need to be further broken down into more detailed
components. For example, for the arrival phase of the service cycle: a TGEE should
be drafted dealing with how arriving guests are directed to the hotel parking entrance;
the greeting given at valet parking; the handling of the bags at the front door; the
script to be utilized at check in; the explanation about the services offered by hotel;
and finally, any initial familiarization issues with the room itself (e.g. how to use the
telephone, television, honor bar and the like).

Each of these contact points should have a written TGEE narrative describing the
target experience. In this case, the more TGEE's the better.
There are certain attributes that management may want to weave into every TGEE.
Companies would be well advised to establish what they consider to be the
fundamentals of service. For example, the Fundamentals of Service might consist of:
customer recognition, speed, accuracy, professionalism and courtesy. Each TGEE
would address these five fundamental elements of service for the particular service,
product or amenity being described.

Only after the fundamentals of each service described are the experiential elements
which go beyond the fundamentals dealt with, Using the food department as an
example, the gourmet restaurant definition of TGEE might include how to properly
conduct tableside cooking. The slot department might go beyond defining simply how
to pay a slot winner and describe how to "celebrate" winners. The policies and
procedures for a bartender could explain when and how to build showmanship into
serving drinks.

The important point here is to create a detailed model of the elements which produce
the customer experience. This should result in a rather extensive compendium of
TGEEs that explicitly describe what we want to create for our customers. The acid
test for each TGEE is whether there is sufficient detail to allow a multitude of
employees to grasp and implement what is intended, Le., they all envision the same
color of green paint.

B. DEVELOP STANDARDS AND EXPECTATIONS FOR EACH TGEE

Each and every narrative driven TGEE should be accompanied by performance

standards and expectations. For example, a casino may seek customer recognition
as one facet of a TGEE but what constitutes customer recognition? A standard and
expectation might deal with this by stating:

1. Each employee will make eye contact with each customer they come in contact
with, whether they are serving thorn directly or not. Employees will not look at the
floor, the ceiling or walk through customer areas without making eye contact.
2. Employees will exhibit positive body language at all times. The essence of positive
body language is to project an alert posture and an eagerness to serve. This
preferably means having a smile on your face but at least, having a "neutral" face.
Employees will stand up straight, face the customer and not lean on anything nor
cross their arms.
3. Each employee will greet the customer with an opening remark such as: "Good
morning", "Welcome to ABC Casino", or "How may I be of service to you?"
Employees will work their name into each greeting. For example, "My name is
_______, how may I be of service to you?"
Standards should be objective as possible, i.e.. "It will not take longer than _____
minutes for a customer to receive change." Some TGEES may require more
subjective narrative descriptions in order to define the standard.
Others may be clearer if suggested scripts are provided to the employees as bases
for their own dialogues. The test of whether a standard or expectation is valid is
whether an experience outside of the TGEE can be identified and measured. If not,
then the standards and expectations for that TGEE needs to be further defined.
There is no sense having a TGEE unless it can be measured because the system
can not self-correct if it can not determine when the system or an element of the
system is sub-performing.

C. DEVELOP WRITTEN POLICIES AND PROCEDURES WHICH IMPLEMENT

AND DELIVER THE TGEE'S
This step is largely self-explanatory since almost all casinos have written policies and
procedures. There may be a difference, however, in that a systemic approach means
that these policies and procedures are not created in a void, they are driven by the
defined TGEEs and the standards and expectations assigned to them.

The common practice of photo-copying the procedure manual from the last casino
worked may not be appropriate because it does not embody the spirit, objectives and
standards for the casino in question. Care must also be taken to ensure the
procedure manuals are not just task and technically oriented. The manuals should
also deal with the soft, fuzzy side of service ... courtesy, professionalism,
entertainment and creating fun.

Securing the "buy-in" of the employees to a TGEEDSystem is part of the challenge of

implementing and maintaining the system. A helpful approach toward gaining
employee support is to have the manuals not only indicate what and how to create
the experience but to go further and explain why each aspect helps to create this
experience. Perhaps each manual should have two columns, The first column would
be the procedure itself. The second column would explain the "why" and "how" of the
procedure. The field of industrial psychology long ago discovered that employees
perform better when they know why they are doing a task. In fact, one very
successful company in another industry has gone so far as to tell their line
employees that if a supervisor or manager can not explain why they want the
employee to do something, they do not have to do it. A bit extreme, but this company
views this commitment as a key element to their overall success.

If a TGEEDSystems approach is taken, procedures should not be written to simply

accomplish a task, they are drafted to create pre-defined experiences. The difference
may appear subtle but the impact on what is created can be powerful.

D. DEVELOPING HIRING CRITERIA

It is often argued that in the service industry, who you hire is the primary determinant
to the successful delivery of a company's TGEE, Like most service industries, the
casino business is not a technically difficult industry to work within. Indeed, 90
percent of the jobs in a casino can probably be taught to 90 percent of the adults.
However, the mind-set it takes to deal with customers on a day-to-day basis and
more importantly, to actually enjoy and take satisfaction from the work of delivering
TGEEs is probably vested in only 10 percent of the adult population.

Historically, casinos have hired applicants based on technicaL/vocational capability.

The theory was that unsuitable employees would be identified during the
probationary period or purged through a disciplinary process. By contrast, the
objective in a TGEEDSystem is to develop hiring criteria which are premised upon
the TGEEs, standards and expectations. The commitment must be to not hire
anyone who does not fit the hiring criteria.

A Hiring System must be an integrated subset of the overall system, i.e., from
proactively identifying target labor pools to developing applications, testing and
interviewing processes that identify employees who will fit into the TGEEDSystem.
Today, more companies are evaluating an applicant's basic personality, attitude
toward life, natural courtesy and interpersonal skills as a primary qualifying criteria
along with the traditional evaluation of technical skills and conducting background
checks.

For example, if a casino deals to the premium, "high roller" it may seek more
professionalism, i.e., the ability to deal a blackjack with precision, speed and
following procedures with machine-like precision. A more grind, tourist oriented
casino may seek more outgoing dealers where the premium will be not on game
speed but on establishing contact and dialoguing with the customer. Service
bartenders need to be quick. A bartender in the middle of the casino may need to be
more like Tom Cruise in the movie Cocktails, ie, a showperson.

Just as engineers set specifications for machines, the more definitive a department
head can define hiring criteria for an employee, the greater the chance of that
employee delivering the TGEE. In kind, the Human Resources department should be
prepared to evaluate five or more employees for each position to find those who fit
the detailed hiring criteria. Otherwise, the hiring process becomes one of reactively
hiring the best of what "walks in the door." The best chefs go to great length to draft
detailed purchasing specifications for the food they use in their recipes. The most
complicated machine can be made inoperative if the wrong part is purchased.
Operational department heads should do no less for their basic "ingredients" and
"parts" - the employee.

E. DEVELOPING ORIENTATION TRAINING AND PROBATIONARY PROGRAMS

The guest should not be the guinea pig for new and developing employees. Any new
employee must be capable of delivering the TGEE from Day One.

The initial period of an employee with a company should be used to verify that this is
the right person for the job.

This is an evaluation period where employees are still earning their right to a job.
Preparing the employee to deliver the TGEEs is a multi-step process. The employee
needs to be indoctrinated to the overall goals, values and culture of the company in
order to become a "citizen" of the company. The employee also needs to team the
technical skills as well as the soft and fuzzy side of the job. This period should also
be used to educate the employee about all of the services offered, where they are
located and the answers to questions likely to be asked by visitors. Their retention of
what has been taught and the ability to execute to proscribed standards should be
continually tested. Employees should not merely attend orientation and take training
classes, the company should test to ensure they have learned each step before
preceding to the next.

This is also a good time to indicate to the employee what they should do when things
go wrong. This deals with both the work environment of the employee (i.e., what to
do if they feel they have been treated unfairly) and the service delivered to the
customer (i.e., what to do if the hotel is sold out and they have a guest with a
reservation in front of them). For companies who espouse empowerment of their
employees, this is the time to explain fully what empowerment means, when and how
to use it. In kind, this is also the time to delineate when it is time to ask for help.

In all, this could also be viewed as a calibration Process, i.e., calibrating the
employee to deliver the predetermined standards and expectations. Recognizing that
not all employees will learn and adapt at the same pace, the calibration process
should have built-in flexibility to deal with the teaming curve of each individual. The
standard should be that no new employee is allowed to get into a "live", customer
contact or service delivery position until they are ready. To view the training,
preparation and calibration process as one mass block of employees moving through
a training program together is simplistic.
Too much of casino human resource dollars are spent on "after the fact" programs,
ie, after they are hired and after they have completed their initial training. Perhaps if
more were spent on hiring the right employees in the first place and preparing them
thoroughly, the results would be more productive. The goal is not to just train the
hands and feet, but to deal with the heart and the mind to energize the employee to
deliver the TGEEs.

F. DEVELOPING MONITORING AND EVALUATION PROGRAMS

Most casinos take a rather administrative and reactive view toward determining the
effectiveness of their operation, i.e., when things go wrong many casinos resort to
disciplinary measures as the corrective and ultimately purging device. A systems
approach takes a different philosophy. System architects realize that machines will
deviate from their "factory" settings with use. Consequently, very few machines are
purchased that do not have either instruments which continually measure their
performance and/or scheduled periodic maintenance that accomplishes the same
thing. Why then is not the same approach applied to our human resources?

Care must be taken to make sure the monitoring and evaluation process is not a
thinly veiled "gotcha" program that leads to the termination of employees. Rather, the
evaluation program should identify situations and employees who are not performing
up to stated standards and expectations. Once identified, they should be sent for
remedial training as a self-help and improvement program designed to help the
employee.

Given the scope and sheer size of a typical casino, resources need to be dedicated
to the measurement and evaluation process. Realize too that the goal is to
continually measure every TGEE. And, monitoring must be thorough to be effective.
It should take place 24 hours a day, seven days per week across all departments. It
should be done from the production side, i.e., with respect to employee performance
as well as from the consumption side of the experience, i.e., from the perspective of
the customer.

This enormous task may require a department unto itself. At the very least, it will take
a dollars and cents commitment to measurement. But, to do otherwise relegates the
casino to being reactive, waiting for an individual circumstance or overall
performance to deteriorate to the point where a customer finally says something.
Most customers do not complain when disappointed, they simply patronize another
business offering the same service. All the more reason to develop a thorough,
ongoing monitoring and evaluation program based on the TGEEs, standards and
expectations already described.

G. DEVELOP REMEDIAL PROGRAMS

As mentioned above, the goal of a monitoring and evaluation program is to identify

substandard performance in order to correct the problem. Oftentimes, the problem
may be non-human, i.e., it may be equipment, system, procedure or policy oriented.
In other cases, the issue may be employee related. Either a problem that effects all
or a large group of employees (e.g., a motivational problem in a department due to
an overbearing manager or the introduction of a new computer system that was not
properly explained). However, most problems will be attributable to specific
employees. Each problem needs to be addressed specifically to the situation at
hand. The goal of the remedial program is to get the employee back to a state where
he or she can once again produce the TGEEs.
This means again that the company needs to identify resources that can spend the
time to work with single, group, department or company wide performance issues. In
smaller operations, this effort may have to be delegated to each department head
whereas in the mega-resort properties. A dedicated group of trainers could probably
be devoted to this effort on a cost-beneficial basis. Once again, the employee needs
to be "tested" prior to going back to contact with the customer. For the sake of the
employee, the company and the customer, the employee should not merely attend a
remedial training program, they must demonstrate they are capable of delivering the
levels of performance expected of them.

H. DEVELOP SANCTION PROGRAMS

The organization must be prepared to deal with employees who continually fail to
perform up to standard. Since reducing price is not a practical solution to a
substandard performance in the casino industry, the only choice is to remove the
employee until their performance returns to acceptable levels. The cost associated
with this policy needs to be accepted and budgeted as another cost of doing
business.

If the same employee keeps needing remedial training andlor can not pass the
remedial training standards, then they need to be separated from the company. This
should be viewed as separation rather than termination since the later carries such a
strong connotation of failure or the implication of wrong doing. In fact, the real issue
is the "fit" between the company values and those of the employee. Blame is not the
real issue, only performance is. Nevertheless, whatever the label, anyone or anything
that leads to substandard performance needs to be purged from the system ... the
part replaced, so to speak, after every effort has been expended to make things
work.

I. DEVELOP AWARD/REWARD PROGRAMS

The reverse side of the sanction program is a reinforcement program. In other words,
when an employee, work group, department or company is meeting or exceeding
expectations the culture needs to be reinforced with recognition, awards and
rewards. In most cases, simple recognition and awards are helpful to culturalizing the
achievement of TGEEs.

Many companies are going beyond awards and developing monetary rewards and
incentives for performance that meets or exceeds expectations. Note that meeting a
standard may be as important as reinforcing performance that exceeds the standard.
If the target "average" performance is established at the right level (and particularly if
high standards are set from the beginning), then "average" should be recognized.
The goal is to create a higher average, not just peak performance of a few.

Nevertheless, "heros" can also be important to an organization because by definition,

heroes have the capability to affect a large number of people. Both average and
superior performance can be rewarded utilizing monetary incentive programs based
on the measurable standards and expectations already established. Such incentive
programs should be frequent, material and visible to all employees. The pay back for
the company is that the award/incentive programs motivate the entire organization to
better performance.

IV. MAKING A TGEEDSystem WORK AND AVOIDING DETERIORATION AND

FAILURE
Most casino companies practice one or more of the nine elements of the
TGEEDSystem. And, there are a fair number of companies that practice all of the
elements in one form or another. A commitment to a TGEEDSystem requires,
however, not only a commitment to each element of the system, but more
importantly, to the system itself. There are a number of forces and dynamics that can
affect the success or failure of the system.

A. COMMITMENT FROM THE TOP A TGEED

System needs support from top management in order to survive. It will require both
time and resources, human and financial to create and maintain the system. For
most companies it will also mean change. As with any change the detractors and
sceptics will challenge the system and, at worst, attempt to discredit and eliminate it.
A systems approach, by definition, will involve virtually every department of the
casino and every casino of the company. In fact, a TGEEDSystem is a means to
implement a cultured philosophy and creating/sustaining culture is very much the
purview of senior management. All of these concerns and issues require that the
TGEEDSystem be totally and unequivocally supported from the top. This support
must exist during the development phase, the implementation phase and the
maintenance phase. If this support diminishes, cracks or is inconsistent, the system
will deteriorate and eventually fail.

B. THE SYSTEM SHOULD BE AN ELEMENT OF A CUSTOMER DRIVEN

CULTURAL PHILOSOPHY NOT VICE VERSA

A TGEEDSystem needs the motivational support of the organization not because it is

demanded but because the System is perceived as the best methodology to achieve
a shared goal - Customer Service. Chronologically, a company culture committed to
Customer Service must be adopted and established first, then the TGEEDSystem,
not vice versa.

C. FIND A HERO

Even with the support from top management and a Customer Driven Culture, the
TGEEDSystem still needs a hero or heroes to fight for, implement and defend the
system. This person may be the Chief Executive Officer or Chief Operating Officer
but more often than not, they are too busy to "carry the flag" for the system. More
likely, the department head of Human Resources or Operations will be in charge of
the program. It is possible, of course, to assign the responsibility to a lower rank. But,
the lower the rank the greater the risk to the system since the decision time to correct
a problem is non-linear with organizational distance between the manager and the
problem.

Regardless, the most important factor is that the manager be a hero. He or she must
a zealot, focused on excellence and committed to ensuring both major threats as well
as tiny cracks in the system are corrected quickly. The Hero must fight for and
receive the resources necessary to make the system function. And, the Hero must
trumpet and promote the successes of the System in order to maintain and increase
adherents to the system. The task of maintaining the System must be the Hero's
most important if not their only responsibility. Otherwise, the risk is that the system
will not fail so much as the system will simply deteriorate and fade away.

D. COST THE SYSTEM INTO THE PRE-OPENING AND OPERATING BUDGET

A TGEEDSystem will be viewed as a "soft" development cost which always has to
fight harder for limited development dollars than the "bricks and mortar" hard costs.
And, if the project goes over budget, the soft costs are usually the first to be turned to
as a likely place to save money. Similarly, when there are competing demands on
operating expenses or when profit margins erode, the System will be harder to justify
because it delivers benefits that are difficult to measure. Consequently, a
philosophical commitment to the System by top management has to be backed up by
a commitment to the financial resources necessary to support the System.

These additional costs include a commitment to hiring staff earlier than unusual to
draft the TGEEs and the standards and expectations for each TGEE. Likewise, hiring
criteria are more detailed under a TGEEDSystem, need to be drafted early and the
number of candidates recruited for interviewing needs to be increased over typical
approaches. The orientation and training programs will generally be more intensive
as well. Finally, the monitoring and evaluation facet of the System may require an
entirely new department or, at the least, the creation of a new position and the hiring
of additional staff. The remedial training programs up to and including the cost of
paying an employee for the training at their normal wage to keep them away from
customer contact until the can perform to target levels will also add an expense. The
premise is that all of these expenses have a financial return through the creation of a
competitive niche, the ability to create stronger loyalty and repeat visitation and an
increase in revenue in general. If management is unwilling to fully fund the System,
the System will again deteriorate, fail or fade away.

E. PAROCHIALISM

Most gaming companies are vertically organized, i.e., around departments. The
TGEEDSystem is a horizontal program involving virtually every department. It is
possible to install a horizontal system while retaining strict departmental boundaries.
The System has a better chance of succeeding, however, if a System "manager" be
allowed to assist each department head with their portion. At the extreme, the
System Manager could dictate to the department head how to implement the System
into their area of responsibility. The optimal situation, of course, is that the Team of
managers cooperate in achieving a shared goal, and titles and departmental
boundaries become seamless. Anyone seeking to install a TGEEDSystem approach
will need to address the challenge of establishing such an all-inclusive system
horizontally into the organization.

F. COMMITMENT TO THE TASK OF MEASURING

Many services are not measured because those responsible feel they can not be
measured. While it is certainly more difficult to measure service than production of
hard goods, service can still be measured. Objective criteria such as the length of a
check-in line or time to get a drink are easy to establish. Measuring body language is
more difficult but still could be defined by watching a test sample of employees and
defining a number of examples that constitutes positive body language. The
evaluator once "calibrated" could then review operations and rank what he or she
observes. Employee morale can be monitored with in-house surveys, peer group
evaluations in addition to the more standard measures of employee turnover,
absenteeism and tardiness. Qualitative aspects of service such as courtesy could be
the most difficult to measure. But, surveys of customers could identify whether
customer courtesy is perceived to be present or not. If not, then a team could be
assigned to the potential trouble area to determine the sources or causes of the
problem.
Simply put, the performance of the System fails if performance itself can not be
measured. Clearly, the area which will need the most new development in creating a
TGEEDSystem will be the identification of valid and accurate standards, expectations
and measurements of each TGEE. The answers are there for companies willing to
make the commitment, approach the challenge with an open mind, devote the
resources and have the patience to put up with the inevitable setbacks that occur on
the path to a solution.

V. CLOSING

Unquestionably, it takes a greater commitment, effort and expenditures to sustain a

TGEEDSystem than a conventional approach. Not all companies are suited to the
challenge and for those who are not, they may achieve greater (but not optimal)
results by relying on traditional methods. For those companies who are willing to
make the committment however, the reward should be material for the customer, the
employee and the investors.

Date Posted: 30-May-1999

Casino Design – The Last Frontier

by Mark Birtha

Casino Design – The Last Frontier

by Mark Birtha

Much has been written lately regarding the surge in non-gaming revenues and the
emerging focus on the redesign of food and beverage, retail, and entertainment
venues in today’s hotel casino property. The rise of celebrity chefs, retail flagships,
Cirque du Soleil masterpieces, dream Spa getaways, and iconic hotel exteriors and
interiors have contributed favorably to the appeal and demand of the overall gaming
hospitality experience. But with the need to continually raise the bar in terms of
design, amenities, and services offered in competing properties and jurisdictions, and
with the emphasis of late centered on these complimentary products, the question
must be asked…”What about the Casino Gaming Floor?”

The casino floor itself often acts as the hub of all activity in these mega-resort and
regional destinations. And even though gaming revenue is continuing to represent
less and less of the overall property top line, it is still by far one of the most critical
components programmed into the master recipe. So why have we not seem more
change in the way the gaming floor looks, where it is located, and the types of
products it offers. Why does the floor look very similar in Las Vegas as it does in
Atlantic City, Macau, California and countless other jurisdictions? Is there even a
need to discuss the tried and true philosophy of casino design at all?

In this piece we indulge ourselves a bit by looking inward and speaking with design
experts about their thoughts on the magic formula for gaming floors and where they
anticipate it headed in the future. Yes, there is change on the horizon.

Trends and Challenges

Three very prominent influences are affecting the casino experience today and are
laying the foundation for an entirely new gaming experience in the future. The first
change has had a profound impact on current design and will continue to be
implemented in properties around the world in the future—the “importing of non-
gaming outlets”. We are beginning to see a common integration of dining, retail,
clubs, and entertainment seamlessly interwoven into the casino space. Whether it is
hip and energetic dining spaces spilling out into the casino, center bar lounges
perched up above the table game pits, high end retail stores adjacent to VIP gaming,
and entertainment offerings “theming” casino landscapes, non-gaming venues are no
longer separated. There is a powerful synergy in putting products with common
customers together to create critical mass and heighten the experience and
amenities available to distinct customer segments. The energy of the casino floor
blends nicely with the excitement of the nightclub, and customers frequenting each
often spend time back and forth enjoying them mutually.

The opposing trend to “importing” is the concept of “exporting the casino experience”
into non-gaming venues. Pool landscaping includes a lush oasis of lagoons, palm
trees, lounge chairs, and now more and more you see table games offered as both a
customer service amenity and a strong revenue generator. Premium salons are
being built on and off casino spaces that provide walk up bars, live music, dining and
a number of high limit tables and slots. The club experience has been heightened
exponentially with the infusion of table games to blend the high energy dance beat
with the equally compelling gaming action. You don’t need to leave the nightclub;
instead, you have gaming in an entirely new environment. The Palms’ Hotel Casino
executed this vision with their Playboy Club. This world renowned entertainment
brand captured the lifestyle and exclusivity elements nightclubs are famous for and
incorporated the casino as a further extension of the experience—beautiful bunnies
dealing cards to hard core and novice players alike enjoying cocktails and the
“scenery”. All in a restricted access, admission charging gaming club venue, a first in
Las Vegas that is not a designated VIP private gaming room.

Finally, the last overwhelming trend that continues to redefine the casino experience
is the advent of new technology. Ticket In Ticket Out, Server based gaming, large
communal slot carousels, electronic table games, and mobile gaming devices
(PDA’s) are all being introduced to the casino landscape. The positive effect on
operations, customer service, payroll, and the all important financials are indisputable
—and further solidify the value in continuing to invest in multiple technological
innovations and advancements. These changes have another cause and affect to the
casino floor: Less space is consumed with the deletion of change booths and service
carousels, aisles may get a bit tighter without change carts or added floor personnel
behind machines, larger spaces are carved out for circular interactive slot stations,
less games may be needed due to possible increased PDA usage, and games and
related signage and overall aesthetics can change instantaneously from a server
room located off the casino floor. Just the tip of the iceberg of things to think about for
the future.

Expert Opinion
In order to truly gauge where the casino of the future is headed, it is always important
to look back at the evolution of the casino property and the influences that have
changed the gaming experience over time. One needs to look no further than the
experts in the gaming design world.

Nory Hazaveh is a Partner with SOSH Architects, a firm focused on design solutions
which reflect the evolving mix of activities for the ultimate patron experience. He has
worked extensively on projects throughout the United States, Canada and Europe,
for customers such as Harrahs’/Caesars, Trump Entertainment, Isle of Capri, Hilton,
Sands and Aztar. Hazaveh takes an historical approach to how casino design has
been influenced. “When gaming halls were more concentrated on table games and
slot machines, the patrons were identified with the type of games and where they
preferred to play on the floor. As the patron’s sophistication increased, so did the
gaming floors. Initially this evolution was influenced by activities within the floor such
as lounges and the cabaret style shows. With concentration on an active floor and
“maze” like circulation they intentionally extended the time one might spend on the
casino floor. This period was short lasted as hotel rooms and amenities such as spas
and other leisure factors were added in to form the mega-casino, especially Las
Vegas style destination resorts.

This new customer experience led the designers and developers to think of additional
leisure activities to incorporate into the gaming venue. The retail element is one of
the oldest forms of human and product interface in an exhibition fashion, such as a
bazaar, and it became an addition to the gaming floor. Parallel with the development
of retail, the restaurant and food and beverage venues joined the evolution. To
continue to increase the diversity of gaming resorts, live entertainment has reached a
new level of performance. As theatres became less profitable to operate individually
in the cities, they have shown great strength and success within mega casino resorts
projects. This cultural evolution has given us, the designers, a palette of opportunities
to create fascinating spaces to be occupied, used and enjoyed by a variety of people
whose orientation may not be solely gaming but rather leisure and entertainment. It
seems we have pushed and removed the gaming hall perimeter walls to replace it
with leisure and entertainment design products to seamlessly interact with other
venues such as hotels, restaurants, entertainment, retail and at times even
museums.”

So this leads us to the present and to the question of what does the casino gaming
floor look like tomorrow. And who better to ask than one of the most innovative and
sought after hotel casino designers in the business today, internationally renowned
Paul Steelman, Principal of Steelman Partners LLP. Having designed some of the
most unique and successful properties in Las Vegas and the domestic United States,
as well as Macau and Asia, Europe and South America, Steelman works closely with
casino developers and operators to create a unique gaming and entertainment
destination that exceeds customer expectations. The Sands Macau, a Las Vegas
Sands owned property and the first “Western” developed and operated entrant into
this unique marketplace, challenged Steelman to not only design something iconic
and representative of Las Vegas, but also create a property that carefully respected
Asian cultural principals and delivered an extraordinary customer experience
specifically catered to Asian guests. And these guests enjoy the casino environment
more than any other marketplace throughout the world, so a differentiated and
compelling casino design was necessary.

Steelman envisions many changes which will impact the way casinos are designed in
the future. The first is the influence of natural lighting creating a daytime and evening
atmosphere and an ever-changing environment during different periods of the day.
One of the more challenging directions he sees casino floor-plans headed is the
multi-level casino, especially given escalating land prices resulting in reduced
floorplates and denser vertical designs. “Our goal is to move people up and through
and around the property, which requires us to focus on unique design decisions to
transgress people floor to floor. Angular slices cut through the building will make
higher floors as valuable financially as lower levels.” Many properties are so
immense in size which makes designing multiple levels challenging; Making upper
floors more visible and inviting is a critical design element. Steelman definitely sees
the “base building blocks continuing to be knitted together. Retail and food and
beverage tenants and operators have realized there is a significant volume of people
in the casinos, sometimes in excess of 40,000 per day. Why would they want to be
separated from the casino floor and that customer?”

Paul Heretakis, Principal and Architect with Westar Architecture and Interior Design,
has completed casino design and remodeling projects for world renowned gaming
properties including the Venetian, Bellagio, Beau Rivage, Harrah’s Atlantic City, and
Trump Hotel and Casino Atlantic City. Heretakis agrees with Steelman in that casino
design will become more 3-Dimensional in the future. Mezzanine gaming spaces,
food and beverage venues intertwined in the casino space, and design elements and
venues will create visual height changes. The Generation X and Y customer will find
this design much more appealing, as “the blurred lines of functionality create a more
voyeuristic aspect in the gaming experience. Multiple F&B experiences on different
levels, attractive people in the casino, each watching the other on different levels, will
create a visual and seamless integration of gaming and non-gaming in the same
space.”

Contrary to many opinions, Steelman sees the casino actually getting larger in overall
square feet. The increased demand from both baby boomers and the younger
generation of gaming enthusiasts will drive the need to alter the design and purpose
of the casino. “There will be more organizing points in the casino—lobbies, bars,
public spaces. Drama will be created in many smaller gaming spaces, and
interconnecting them will make the casino proper bigger.” Steelman is already seeing
resurgence in table games play, specifically high limit gaming, and this trend requires
more programming space. “Increased gambling will be critical to offset rising land
and building costs.”

Heretakis believes that casinos will always focus on their core customer but will
design amenities and “districts” to offer different experiences to different guest
segments. “Districts within the casino will be created to provide gaming experiences
for multiple demographics. Amenities such as retail, food and beverage, and
entertainment will have to cater to each. This includes sensitivity to gender related
design. Females may prefer specific games in a district with a softer look and maybe
a retail component. Males might want a poker area that is quite masculine in design
and offers bar or club amenities. Either way, the guest does not need to leave their
area in order to enjoy a non-gaming product—a space that is moving in the direction
of a Starbucks-like lifestyle experience. It is your place.” Steelman also foresees the
advent of buildings within buildings, and something he has coined as “fashion
architecture.” “Fashion will be translated into buildings that become independent
structures, thrust into the middle of the casino. A Hermes retail and casino building
environment catering to the ultimate consumers.”

Brad Friedmutter, Principal of the creative and visionary Friedmutter Design Group,
has designed casino spaces and non-gaming amenities for developers and operators
in various markets: Red Rock and Green Valley Ranch Hotel Casino for Stations, the
Cosmopolitan for Bruce Eichner’s 3700 Associates all in Las Vegas, Cache Creek,
Thunder Valley Casino, and Pala Casino Spa Resort in California, and Horseshoe
Casino Bossier, Louisiana and Horseshoe Casino Tunica, Mississippi. Friedmutter
understands the challenge that many developers and operators face when designing
their property. Las Vegas has close to 40 million visitors annually and almost 2
million residents and is a 24 hour, 7 day a week city. Top it off with an underlying
theme of “anything goes” and the naughtiness associated, coupled with the customer
anticipation of winning and repeatedly asking “Do you feel lucky?’, incorporated into
an environment that must be safe, secure, and clean at all times. A design task
unlike any other type of project. He believes that most casinos have been designed
for the baby boomer population, and he anticipates some of the greatest challenges
and opportunities coming from reconfiguring design to meet the needs and
expectations of a new and powerful gaming segment: Generation X & Y.

“We may see video game room spaces like arcades with new types of slot products
catering to the X & Y generations—high energy, fast paced, communal and
competitive, visible yet secluded, integrated into the casino floor plan. A faster paced
experience with immediate gratification is the challenge. Design elements will look to
fuse social status with casino games and entertainment experiences. We may see
separate specific zones or pods that cater to targeted demographics with customized
amenities and services to meet their respective needs, yet still allows for cross over.”
It is already common to see retail and food and beverage amenities connected to
gaming floor spaces, and typically slot denominations or table games limits reflect the
type of customer that frequents the associated non-gaming venue. Food court areas
may be adjacent to lower denomination slot machines and the finishes in that area
may also be differentiated. Friedmutter also sees more “atmospheric changes”
coming in the casino landscape. “Gaming is a sensory experience—the more senses
touched, the more exciting the experience. Different music soundtrack elements will
be incorporated, smell aromatics are being used more and more, seeing areas busy
or not busy invokes different perceptions. Raised platform areas with different games
and décor create varied energy levels all visible from the lower level. Peripheral
casino spaces will have retail, restaurants or clubs directly above them allowing
visibility into both environments. Atmospheric changes throughout the day is a new
design frontier.”

There is no doubt that technology will have a profound impact on future casino
design. Heretakis sees gaming being intertwined with other entertainment options,
courtesy of the newest technology. “I would not be surprised to see music kiosks,
video and retail integrated into the games and casino floor. An iPod port into tables or
slots. Gaming is a social experience, and entertainment can be especially targeted to
the younger generation.” Steelman also sees technology having a direct impact on
the aesthetics of the casino floor. Innovations such as customer text messaging will
require fewer traditional methods of advertising and promotion, such as sign holders
and message boards. Less signage and intrusive distractions results in longer play
and increased revenues. Friedmutter agreed, and believes text messaging and email
will create an interesting dynamic that has yet to be seen. The younger generation is
into “communal technology’, like My Space. These community interactions will be
offered on the casino floor with communal slot carousels, competitive video-like slot
games, and wireless gaming. And of course other design features and services will
follow in the future.

Customer Experience—The Heart of Casino Design

The programming and design of the casino proper has not changed as dramatically
as the rest of the non-gaming landscape. Only now are we beginning to see the
changes come. It is starting with the infusion of gaming into Salon Prive’s where
enclosed rooms house higher end table games, chic bars, pulsating music, and well-
attired servers creating a truly differentiated casino experience. From a design
perspective it is important to have these spaces seamlessly blend together so that
they have shared energy and traffic and easy access and use. Spaces should feed
each other---restaurants bleed out into the casino space, table games are
incorporated into Clubs and Lounges, and entertainment venues and retail spaces
create anchors to drive people through the casino and other programmed areas.

So the casino design reinvention is happening—this is just the beginning.

At the end of the day, casino design reflects the need and demands of one audience
—the customer. Heretakis summed this up eloquently: “I know the operators know
how to manage their casinos. So for me it is about the customer experience. What
are you trying to create? Who is your target market? What amenities are needed and
how do you group elements together to cater to that customer segment.” Whether it
is the high end, the middle class mass market, or the budget conscious, and no
matter whether your customer is of the younger generation of gaming enthusiasts or
the older and more seasoned gamer, your casino design will offer elements that cater
to these specific genres and their respective expectations. The debate will continue
on whether gaming is a shared or intimate experience. Should non-gaming elements
continue to be interspersed into the casino floor, or should gaming be infused into
entertainment and hotel venues to offer a wider menu of choices. Either way, the
newest technologies, changing customer segments, and the ever evolving casino
landscape will require both flexible and innovative design for years to come.

The goal will be to effectively understand your customer, give them a casino product
that fits their needs, and still not ignore the other customer segments that want a
casino experience slightly different than your target audience. It is impossible to be
everything for everyone, but with today’s’ architects, technology gurus, AV wizards,
and casino experts spending time together it is reasonable that the tried and true
standards and requirements of casino design will be taken to the next level. Nobody
can clearly foresee what the future casino will look like. One thing is for sure, as the
demands, dynamics and demographics of the casino’s customer continue to change,
so too will the casino’s design.

Date Posted: 23-Oct-2007