Cutco makes fabulous knives. Customers pay a premium to have a knife for bread, a knife for steak, and a knife for mayonnaise. Yes, a knife for mayonnaise. If you’ve ever made a sandwich with a spatula spreader, you know what I’m writing about.
To our peril, we’ve been using a meat cleaver for everything, and it’s time to stop.
Here’s how to take a Cutco approach to database analysis. Slicing and dicing data needs a fresh mindset and better equipment.
Why are we slicing and dicing in the first place?
With strong conviction, we commit ourselves to being data-driven organizations. But what’s our intent? Are we looking to buy the business or court the business? A transactional mindset drives us to slice, dice, and segment according to ADT alone. We single-mindedly determine one thing – what kind of coupon shall we throw at the customer to win the next trip? Data-driven marketing can live beyond the confines of comp, coupon, and promotion determination. It can feed recognition, prioritization, access to amenities, and attention that will drive customer engagement further. There are more ways to slice and dice to drive greater engagement with the guest. Engagement breeds loyalty. Loyalty drives revenue. Revenue from loyal customers can weather seasonal change and competitive threats better than an active customer base entitled to transactional entreaties.
Anything can be segmented
Irrespective of how much we like or dislike the measures we live by, I can rank absolutely anything. I can segment slots like apples, bingo like oranges, and bananas like table games. If you ask me to, I can rank mangoes, kumquats, and persimmons. That’s not hard.
Serving up the perfect fruit salad
To treat our players differently, we have relied on two choices: a fruit salad and a smoothie. Now that’s hard. Our first attempt at slicing and dicing serves up a loyalty fruit salad. We load all our parts into a bowl and then reinvest as if each morsel has the same value to the customer. We’ve been trying to give apples to bananas, and turn oranges into apples. The emphasis in this situation is on couponing. We assume that if we send it, a player will switch from one gaming silo to another.
Solving it with a smoothie
The alternative is to pull out a blender. Let’s blend all the gaming spend together. If we’re smart enough, we can convert table games, bingo, poker, and keno into points, then blend it together with slots into a loyalty smoothie. Then we dole out rewards based upon a customer’s profitability to the property. We can concoct the perfect indices that only make sense to one or two people in the back office. The math will be perfect and the deployment a sloppy mess. Well done.
Our expectations for quantitative review have taken our eyes off the prize. We’ve made the math about us instead of about the customer.
The third option takes reinvestment off the table
It shifts the focus from our operational math to the math of customer experience. It’s a new version of a fruit plate. The object is to add all spend together, and then give out property benefits based upon the entirety of the platter. I like this idea. There’s an element that makes sense to me. If a guest walks in the front door and spends money for entertainment in the form of food, hotel and blackjack, we honor that spend. The guest knows the size of his wallet when he entered and the size of his wallet when he left. He could care less about our margins. He just knows that he dropped cash and we should appreciate that. The size of the platter does not determine a transactional exchange. It does determine access to property benefits, events, and special attention. This is the realm of player development and tiered card benefits. This analysis is not a precursor for coupons or comps, where profitability plays a dominant role.
Siloed thinking
Everything I have learned about gaming, I relearned from BINGO.
There is a time for siloed thinking. If we work as skilled data chefs, we utilize our cadre of Cutco knives to slice and dice each gaming type and outlet spend individually. We rank the spend to find Sweet Spots, Thresholds, and to determine VIP spending. The first step is to determine whether the most spend within each silo comes from guests who are dominant to that silo. What percentage of blackjack players only play blackjack? Does the size and contribution of this audience merit niche-level marketing efforts? We can easily reinvest within a silo with similar incentives. That way, we avoid sending slot coupons to a roulette player. Likewise, we can rank Bingo players and entreat the guests to tiered rewards within the silo. Oftentimes, we use our slot thinking to send bingo coupons to a bingo player when the margins cannot support this kind of activity. The Free Play couponing model works for slots, but let’s not assume that discounting works for other game types. The Bingo player is a social animal who thrives on recognition. Operating within a silo allows us to personalize the method of engagement, the size of reinvestment, and configure our communications to fit a unique set of player profiles within each silo.
Niche upon niche
When we try to blend table games with other forms of spend, our table games players feel like bruised bananas. They feel manipulated or forced to play slots in order to get attention. Likewise, within the table games environment, no two bananas are the same. Treat a blackjack player like a Cavendish and a poker player like a plantain, and they will appreciate your siloed thinking. Each group needs to be studied by three people sitting in one room: the marketer, the data analyst, and the operations expert. Get to know the different holds amongst the table game types. Constantly question how value is determined and recorded on the floor and tabulated by the software system. Study the ways to cheat the system. Understand the margins that determine profitability. Build profiles of why the customer enjoys each game and the unique ways that he or she likes to receive rewards.
It’s only when we do the slicing and dicing to better understand each fruit, that we can reinvest appropriately. Our reinvestment is not only determined by the coupons we throw at a customer to incent the next visit, but by the labor we put towards getting to know each customer better. If we calibrate our efforts better by keeping siloed understanding in mind, we can connect better with the guest.
Serving the flip-floppers and crossover players is another blend requiring yet another set of knives. As any other chef will tell you, top-notch cuisine begins with proper knife skills. The sharper the knife, the less you bleed.
