Player Development KPI Plinko
Do metrics motivate? No.
Do metrics improve performance? No.
Do metrics drive revenue? No.
Metrics are indicators. Metrics can work as triggers for further action. Metrics serve as red, green, or yellow flags for time that has already passed. Metrics, in effect, are only a mark in time.
So why do we think that metrics will align our efforts, prompt improvement, and increase our returns? The existence of reliable data distilled down to a metric that you monitor is an important discipline. It’s a mammoth task to construct the internal mechanisms to deliver these tools. Now what? The journey only begins when an organization has access to reliable data delivered in a broad selection of metrics.
Here is where Plinko comes into play. Data abounds. We can pluck countless data points from a CRM system. We can monitor these data points and call these indicators metrics, with which we judge our returns and performance. By limiting our selection, we can raise the status of a metric and turn it into a KPI, a Key Performance Indicator. KPIs are the metrics that make departments sweat. Did we meet our numbers? Are the numbers right? Are the incentives attached to the KPIs reasonable?
KPIs and Casino Player Development
KPIs that feed sales compensation programs need to be aligned with overall casino goals, and reflect how new or established an entity is within a marketplace. Most importantly, only two or three metrics should be included in a sales compensation program. More KPIs muddy the waters; Hosts who have too many targets have difficulty prioritizing their time and effort.
To decide upon a selection of KPIs, we need to categorize and qualify the different types of metrics and examine their utility. This is like dropping each metric through a Plinko game to see where it lands. Where it lands will determine whether the metric will graduate to the level of a KPI.
Fortunately, many metrics are useful to aid in the sales process. Can you drop each metric that you monitor into one of the following categories?
What tasks are attributed to the brand image and overall success of the casino?
Do you strive to be the friendliest casino in the neighborhood? Do you have the best promotions in town? Is your loyalty program the most generous?
Customer surveys and market share reports produce metrics that monitor these attributes.
Performance standards help illustrate how employees embody the brand. Setting goals towards these metrics allows casinos to drive towards better standards by breaking the implementation into more bite-sized and attainable pieces that can be measured. However, these types of metrics rarely make the cut as sales-driving KPIs.
What tasks are attributed to driving more play or more trips at the player level?
If you evaluate your top salespeople, what do you find? Are there certain tasks that they perform that drive success? Are there touch points that they use (like cold calls, personal letters, or time spent on the floor) that feed results? How do they prioritize their time? How do they build the pipeline of players that sustains growth? Many metrics can be tied to success. If you register X, then Y will follow.
If a salesperson achieves their quarterly KPIs, a sales compensation program is set to reward the Host above his or her base salary. If a salesperson falls short of his or her KPIs, then coaching metrics are there to help guide both supervisor and salesperson towards better performance. In many instances, coaching metrics better performance, but they do not directly affect revenue.
A Host’s job is to drive sales through Acquisition, Retention, and Reactivation activities. The shift from a reactive mode to a proactive mode pivots on the Host’s ability to connect with sales potential and leverage relationships to increase trips and spend.
Complexity ensues when the means to measure revenue take many forms. Are sales measured by Coin-in or Theoretical? Should the comparative time period reflect growth sequentially or from the same period last year? Is the measure of choice reliable over time, or is it too volatile to serve as a KPI?
It is not a question of whether to include revenue metrics as KPIs. The challenge is in qualifying the measure to best reflect the capture of business that is sustainable. Was an increase in trips or spend gained at significant cost? Did the sales efforts engender loyalty, and is that loyalty measureable over time?
To hit a sales KPI, a Host may game the system. What? Shocker. Throw Free Play and Hotel Rooms at any guest, and the ensuing Theoretical will balloon. Tallying up the expenses following habits that invite the same guests to every VIP event and revenue may look fine, but profitability won’t.
Profitability caveats need to be woven into the measures that reward success. Savvy reporting will always reveal sales leads that support revenue growth. No market is too mature for growth. However, mature Player Development programs in established markets may struggle to retain customers. Meteoric growth expectations shift to an emphasis on wisely sustaining the business. Managing churn, building a healthy pipeline of players, and controlling costs take center stage. Do you have metrics to reward a sustainable approach for responsibly managing a portfolio of customers?
It’s all about the sales growth, isn’t it? If you were to allocate a percentage of time spent to each task that a Host performs within a day or a week or a month, a high percentage of her time would be spent serving as a Host, not as a salesperson. Hosts do not operate in a vacuum. The calls she answers, the floor time, the presence at an event, all play in to servicing guests and supporting her peers.
Response rates to events, speed of response to inquiries, and departmental ROI all serve as metrics to watch in order to gauge how well the Hosts perform as a team.
KPIs within a sales compensation program can fall in to two buckets: those that reward the individual, and those that recognize a team. The weight an organization puts on one versus the other reflects how integrated the approach to guest service is woven into each job description.
To form new habits, one needs to operate under a new set of rules and expectations for a moderate amount of time. To celebrate a grand reopening, to roll out a new loyalty program, to thwart competitive threats, short-term promotional directives spotlight sales tactics that need to be unleashed for a limited time.
The metrics that measure enrollment and participation merit rewards to salespeople who fulfill their quotas. However, each item is a step or two away from generating additional Theoretical beyond the hang time of the directive.
Book of Business Management
The final set of tools evaluates the collection of players that a Host serves. Metrics and reporting that monitor Churn, the player mix in contribution and count of behaviors that reflects Acquisition, Retention, and Reactivation stages, or the balance of Inclining or Declining spend and visitation, all help the Host manage his book of business. Like coaching metrics that monitor tasks that directly affect the player, this collection of metrics seeks to round out and help prioritize tasks across a portfolio of customers.
Player Development Departments may support a collection of varied Host positions that cater to different segments within the database. Sales compensation programs need to reflect the different set of expectations commensurate with each differentiated job description.
Book of Business Metrics help the Host to evaluate customers who they seek to code, the strategies that the Host devises to court loyalty, and prioritize his time across a multitude of opportunities. A collection of metrics supports a robust approach to Player Development. However, there is a science to building a small set of KPIs that suits a Host’s job description, the overall goals of the casino, and the competitive climate. The road to utility begins with the proper identification of the function of each metric and its connection to revenue generation.