Utilizing competitive data department feedback for your casino marketing budget
As budget season rolls around, executives are busy planning, calculating, and the big one – justifying their proposed spending. This process hopefully is top of mind throughout the year, so when it comes times to put the spreadsheet together, it is much less painful. The reality is that with managing the day-to-day operations, many times this process is left to the last minute.
It might sound crazy, but even though I am a marketer at heart, I love budget season! For me, budgeting is an on-going process and is directly tied to the property’s overall strategic initiatives. Having sat in front of the board of directors making my pitch, I always wished there was a resource for the inevitable questions. The first one is “How does this budget compare to other properties,” and the second one is “What are other properties doing?” The first one is a bit tricky to truly understand, but you can make some highly educated guesses if you are shopping the competition’s advertising, direct mail, and players club. The second question can be easier, but it is still a guess.
Another resource for tribal casinos
Last year Raving introduced the first Indian Gaming National Marketing Survey. Fifty three casinos participated (11% of Tribal casinos). This survey included properties throughout the US with a mix of rural and urban regions. 16% of the survey included some of the largest properties in the industry. The respondents told us about their reinvestment ratios, percent of carded play, entertainment program performance, whether they’re working with big data, how they’re faring financially compared to their competitors, and much more.
According to Raving Research Partner, Deb Hilgeman Ph.D., “The survey was the first quantitative study that looks at casino marketing and the issues facing it.” Hilgeman believes this survey is extremely important to the industry. “I think we have just crossed another mountain with this survey. This survey is a very specialized tool that pulls together what has been happing in casino marketing since evolving in the early 90s.” Please see the end of this article to access this report.
As a marketer, access to this type of data is valuable for strategic planning. It is also a great tool for any General Manager, CFO or Board Member who is interested in understanding marketing as a whole within the industry.
Casinos that incorporate this type of information into their marketing strategy and budgeting process have an advantage. By using third party data to evaluate your goals and objectives, you gain credibility. It’s important that the information is used to compare your property goals and objectives, not copy the competition. What I mean is you need to avoid the tendency to follow the pack. Just because someone is doing it, doesn’t mean it is successful. However, understanding where you fall within the data set is powerful information you can use to create unique benchmarks for your specific market.
Tips for preparing your 2018 budgets
As you work on your marketing budgets for 2018, tribal casinos, as well as commercial casinos, can use this survey information as another data source to improve and justify your marketing budget. But this should be only one source in developing a comprehensive budget plan:
- Begin by reevaluating your existing marketing plan. Yes, dust it off and read it. Highlight the areas that are no longer relevant or add opportunities that have potential going forward.
- Engage your accounting department and data analyst to help you evaluate performance over the prior year. By spending time reviewing prior year results, you will discover trends that can even help you reduce spending in one area, allowing you to allocate it to a more profitable one. You don’t necessarily need to grow the marketing budget to improve performance.
- Don’t forget to gain input from the rest of your team, and I am not talking about just the marketing department. It’s important that you ask your peers how they believe the marketing department is fulfilling the property’s objectives. It is best to gain their insight or objections before you present your recommendations. Nothing feels better than having the CFO recommend that the budget be approved, and yes, that can happen!
So even if you don’t love the budgeting part of the job, I hope you will take advantage of the additional resources that can help you create a budget that you will be eager to share with your Board of Directors!
