Technology aids casino marketers; caution urged

David Strow

Tuesday, Feb. 15, 2000 | 10:55 a.m.

Technology presents more opportunity than ever for casinos to tailor their marketing to each customer.

But with technology comes the risk that the personal touch could be lost.

"The personal touch is important to us, and has been for years," said Raul Varela, casino marketing executive at the Golden Nugget hotel-casino in Downtown Las Vegas. "All this talk about self-(comping) ... I don't think it's the future. The personal touch is extremely important in our business, and we can't get away from that."

Valera, together with casino marketing executives from Harrah's Las Vegas and Sam's Town, spoke at a recent meeting of the American Marketing Association's local chapter.

Cost-effective casino marketing has always been a challenge. It's a particular challenge for Sam's Town on the Boulder Strip, which relies primarily on local customers.

Sam's Town primarily uses direct mail to reach its customers, said Doug Hoppe, director of casino marketing. But it isn't as simple as sending out a coupon for a 99-cent shrimp cocktail anymore.

"We have to make sure we have profitable customers in our property," Hoppe said. "We have very savvy locals. If you give our locals a free buffet, they'll take it and walk out on you.

"It makes no sense for us to spend a dollar to get 50 cents."

To do that, casinos need a greater understanding of each customer than ever before. One company using technology to gain that understanding is Harrah's Entertainment.

Brandi Jarva, director of casino marketing at Harrah's Las Vegas, said her company relies on a player marketing system -- the "Winner's Information Network" -- that connects its 20 casinos scattered across the United States.

The latest to connect to the system was the Rio hotel-casino, which went "live" Feb. 1.

"That database holds every single customer for every single Harrah's property in the country," Jarva said. "(The database) numbers in the millions."

New player information is uploaded to the system each night. By morning, every Harrah's employee, down to the front-desk clerks, can use the system to cater to the customer.

"A Diamond Card player can walk into any property and be instantly recognized as a Harrah's customer," Jarva said. "We can see what kind of room you like, what food you eat. Front-line employees are trained on this thing, so every employee in our company is a marketer."

Each player in the system has a designated "dominant property" -- the property identified as the one the player usually visits. The dominant property has first call on any marketing aimed at that player, though other properties can market to that player with permission.

This cross-marketing system resulted in Harrah's Las Vegas being booked to capacity on New Year's Eve, even as other Strip properties struggled to fill rooms, Jarva said.

"With the system, we were able to react much quicker (to low demand)," she said. "We knew what our customers were saying."

By lowering its room rates gradually and sending out personal invitations to the company's best customers, Harrah's was able to achieve 100 percent capacity by New Year's.

"We were able to pull in people who come (to Las Vegas) to gamble," Jarva said. "We didn't sacrifice quality for quantity."

Another element of the Harrah's technology system is its Internet site. Through the Internet, Harrah's customers can book rooms, check player points, and even reserve tickets on National Airlines -- a company Harrah's is invested in.

Technology remains an important part of the Golden Nugget as well, Valera said.

"The local market is profitable, and will go out of its way to find the best product," Valera said. "You need to have a good slot club to capture that market, to acquire names and addresses.

"We need to find out who you are, so we can invite you back."

Technology can be used to "comp" these players much more efficiently, particularly the lower-end gamblers. Harrah's, for example, offers players the ability to redeem points for comps at kiosks throughout the casino, up to $100 per day. About 15 percent of Harrah's Las Vegas customers use the kiosks, Jarva said, compared to 30 percent of customers in Atlantic City.

The Golden Nugget also offers limited self-comping, though Valera thinks it's dangerous to take the human element away from the low-end gambler.

"You have to be very careful," Varela said. "The $5 player could graduate and become a much bigger player than they were before."

Technology can be a valuable tool, but it can't take the place of human contact, Jarva acknowledged.

"You can have great people in great positions, but if they don't know how to take care of the customers, you're not going anywhere," she said.