how to measure & improve casino customer satisfaction - e-book
DESCRIPTION
Repeat business from returning customers plays a vital role in the success of a casino. Customers that are satisfied with their gaming experience at your establishment are more likely to return. They are also more likely to bring their friends, family, and coworkers along with them. In this 17 page ebook, you will learn how to improve your customers’ satisfaction and more. Read more at http://www.nbrii.com/blog/measure-improve-casino-customer-satisfaction/TRANSCRIPT
Table of Contents CHAPTER 1: SCIENTIFIC APPROACH TO INCREASING REPEAT BUSINESS.……………………………………….....2
CHAPTER 2: CASINOS THAT FOCUS ON GUEST SERVICE HIT THE JACKPOT …………………..……………...…..5
CHAPTER 3: CUSTOMER SATISFACTION: TURNING YOUR BUSINESS INTO
WHAT MEN AND WOMEN WANT……………………………………..………………………………………………….…7
CHAPTER 4: GAMING ESTABLISHMENTS USE RESEARCH TO COMPETITIVE ADVANTAGE……………………9 CHAPTING 5: GETTING THE MOST OUT OF YOUR CUSTOMER RESEARCH…………………………...........……13
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CHAPTER 1: A SCIENTIFIC APPROACH TO INCREASING REPEAT BUSINESS Repeat business from loyal customers plays a vital role in the success of most businesses. Customers are much more likely to return to your business if they are satisfied customers. Some businesses rely on common sense when deciding what will lead to customer satisfaction. For example, it seems obvious that customers will want friendly, efficient, service. It seems logical that customers will want quality products and services at a good price. Right? Throw common sense out the window The problem with the “common sense” approach is that common sense isn’t as common as we think. Each person’s “common” sense is based on his or her own personal experiences and each person’s experience is extremely limited when you consider the diversity of human behavior. Common sense knowledge varies widely across groups of people due to cultural differences and differences in experience. Not only does behavior vary widely from one group of people to another, but behavior also differs in one person across situations. Let’s look at how the variation in one person’s behavior applies to customer behavior. I can see these differences in my own consumer behavior. For example, when I am a customer at a fast food restaurant, I want fast, efficient service, especially if I am using the drive-thru. If the drive-thru has multiple windows, after placing my order at the first window I expect to see a bag of food dangling from an extended arm by the time I get to the second window. If it is not there, I wonder what the hold up is. Once I have the bag in my possession, I do a quick check of its contents to make sure I received everything I ordered and paid for. If I received the food quickly and the contents are correct, I am happy. I am less concerned with consistency in the quality of my purchase. Even if the temperature of the food is not perfect on some visits, but great on others, I am still highly likely to return to that fast food establishment if service is fast and accurate. However, if I am patronizing a fine dining establishment, I am not concerned with speed. Instead I like to take my time and enjoy a leisurely meal while visiting with family or friends and I do not want the restaurant staff to make me feel rushed. I also care more about the friendliness of the staff and consistency in the quality of the food and service.
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Accuracy of my order is still important, but not a deal-breaker because I trust that if there is a problem it will be corrected to my satisfaction. The restaurant’s atmosphere is also very important to me. I prefer a restaurant that is nicely decorated and has a cozy atmosphere. With the fast food restaurant, I am happy if it is clean, but the décor is not that important to me. Since human behavior is diverse, relying on common sense will not serve you well in satisfying your customers and increasing their intent to return to your business. So where should you get information on how to please your customers? From your customers Properly designed scientific research can give you insight into how your customers think. Surveys can reveal information about your customers’ attitudes and perceptions. Specifically, you can learn what drives your customers’ satisfaction and intent to return to your establishment. With this information, you can take action to influence your customers’ behavior and perceptions in a positive way, thus increasing the likelihood they will return to your business. This information can be especially helpful with segments of your target market that, in general, may be less likely to return. Take for example, the gaming industry. Many people gamble as a form of entertainment. There are many aspects of the gaming experience the person may enjoy but let’s face it, nothing beats winning. Winning is a rewarding experience that, in and of itself, reinforces the behavior of gambling. Losing however is not reinforcing. Have you ever seen someone jumping up and down is a casino with a big smile on their face while screaming, “I lost! I lost!” That just doesn’t happen. It is important to find other ways to make the gaming experience satisfying for these customers so that they will continue to return to that gaming establishment rather than going elsewhere. Whatever type of business you operate, it is important to regularly survey your customers to learn what will keep them coming back to your business. What information, specifically, do you need to get from customers to accomplish this? The theory of planned behavior can help answer this question. Developed by psychologists Icek Ajzen and Martin Fishbein, the theory of planned behavior is a model used to predict deliberate behavior. According to this theory, the best predictor of a behavior is a person’s intention to perform the behavior. This intention is determined by three things:
The person’s attitude toward the specific behavior; The person’s subjective norms (person’s beliefs about how other people they care about will view the
behavior in question); and The person’s perceived behavioral control (the ease with which the person believes they can perform the
behavior).
Thus, one of the most obvious questions to ask in a customer survey is a direct question about intention. We want to know the customer’s intention to return to our business so we include a survey item which asks the customer to identify their level of agreement with this statement, “I will visit this business again.” In addition, we will ask other questions that will help identify the customer’s attitudes, beliefs, and perceptions about the business and their experience with it which influence intent to return. An organizational psychologist can develop scientifically sound survey items to address all of these factors. An organizational psychologist can also use the customer survey results to identify the drivers of your customers’ behaviors and identify exactly what items need to be addressed in order to increase intent to return. Sometimes organizations make the mistake of focusing only on the survey items that receive a low average score. This is a
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common sense approach. But just like relying on common sense to know what customers want, there is a problem with focusing only on the lowest scoring survey items to increase customer satisfaction and intent to return. What is the problem with this approach? It is usually a complete waste of time Just because overall, customers rated a survey item poorly does not mean that improving their perceptions of that item(s) will increase their satisfaction or their intent to return. Those items may not be of great importance to your customers, even if your common sense tells you they should be very important. Organizational psychologists, using sophisticated statistical techniques, can analyze the relationships between every item on your customer survey. Based on this analysis they can identify just a few items that are driving (influencing) a large percentage of the other survey items. Specifically, the psychologist can identify the items that are driving customer satisfaction and intent to return. This takes the guesswork out of what a company should do once it receives the survey results. Only the drivers need to be addressed in order to influence customer behavior in a meaningful (profitable) way. Let’s look at an example of how scientific research was used to take the guesswork out of identifying the drivers of customer behavior in that difficult customer group mentioned earlier: gamblers who lose. Recently, the National Business Research Institute (NBRI) conducted an analysis on data collected from 50,000 customers of a gaming company. In the only analysis of its kind, NBRI identified the drivers that influence satisfaction and intent to return in two different types of casino customers: customers who lose while playing slots and pit customers who lose. There are so many factors that can potentially influence a casino customer’s experience that common sense leaves us completely in the dark when trying to determine the factors that make losing customers want to return to the casino. Utilizing scientific research however, the darkness quickly becomes light. In the study conducted by NBRI, it was discovered that for slot losers, both overall satisfaction and intent to return were driven by the customers’ perceptions of:
The casino as a fun and exciting place; The friendliness and helpfulness of the casino staff; and Intent to return for slot losers was also influenced by their perceptions regarding the wait time for casino
cashiers.
Overall satisfaction was also influenced by customer perceptions of:
The value of the players card reward program benefits; and How easy it is to obtain comps earned on the reward card program at another casino they play at. Thus
revealing that it is vital to know how customers compare your business with other similar businesses.
For pit losers in this study, both intent to return and overall satisfaction were driven by:
Customer perceptions of the casino restaurants.
Overall satisfaction was also influenced by:
The quality of the food and beverages in the restaurants; and The wait time for service in the restaurants.
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Knowledge of these drivers, obtained through scientific research, can be used by this casino chain to take actions that will increase customer satisfaction and intent to return in this difficult customer group. Of course, the target market for any business can be segmented in many different ways. Studying the intentions, perceptions and attitudes of various segments of your target market can give you information that, with proper action, will lead to more repeat business and increased profits.
CHAPTER 2: CASINOS THAT FOCUS ON GUEST SERVICE HIT THE JACKPOT When it comes to guest services, it takes a formidable strategy to be successful in the gaming industry. Satisfying guests who aren’t too happy about dropping $500 at the craps table in 20 minutes can be extremely challenging. The bottom line for the casino is to use every possible angle of guest services to achieve what every executive wants from their customers: lifetime loyalty. How did a small bingo parlor become the largest gaming company in the world? They focused on guest service. Harrah’s Entertainment, Inc., which was recently purchased by two private equity firms for $17.1 billion, rose through the gaming ranks from its humble beginnings as a bingo parlor to yearly revenues of nearly $8 billion with 40 casinos in 13 states, including Las Vegas mainstays like Caesars, the Flamingo and Bally’s. William Harrah was emphatic about guest service, focusing on his customers and his employees. In the post-William Harrah era following his death in 1971, the company grew by focusing on venues catering to Middle America, avoiding the brighter spotlight of the flashier Vegas casinos. Instead of pouring their precious resources into building the next mega-casino many casino properties have discovered the profitability of becoming the everyman’s casino, with guest service being the magnet to attract more customers. No matter how a gaming corporation chooses to utilize their resources, the fact remains that no casino today can survive without making a guest’s time at the property as pleasant as possible.
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“I would argue that guest satisfaction for the mass market customer is delivering as few hassles as possible,” said Jim Kilby, a professor in hotel management at the University of Nevada Las Vegas. “When dealing with casino players, as opposed to a hotel customer, guest service gets them to continue buying. I see guest service in a casino as more guest sales. The nicer we treat you, the more you buy.” Kilby, a co-author of the book “Casino Operations Management,” says that gaming companies are investing millions in service and technology to please every customer, but not all customers, especially in the casino business, will be treated equally. This is by design. “As far as guest satisfaction, there are different standards depending on the playing level of the customer,” said Kilby. “We have players who are provided with a 24-hour butler. They have a private limo with a driver for their use at any time. Some players require this level of treatment to be satisfied.” Alternatively, many casinos have discovered that their bread and butter are the players who don’t require the around-the-clock staff or stretch limo. Not that they don’t want the business from “whales,” gambling’s highest rollers. But many casinos have never had the panache of a Bellagio or Venetian, so after trying for years to consistently land big money players, many have given up on it. Many casinos today are focusing on measuring and analyzing customer behavior through guest service surveys. Casinos use these surveys to garner the necessary feedback to help the property create and maintain an environment that appeals to its guests. “Guest surveys can be effective in designing a moments of truth cycle for casino play,” said William Thompson, a UNLV professor and author of several gaming books. Thompson says that casinos invest heavily in guest satisfaction, but there are still flaws in the system. The typical guest survey tends to highlight whether a gaming facility is meeting the expectations of its guests, what improvements are necessary and how it compares to the competition. But the most important piece of information, by far, that a well-executed guest service survey can uncover is the likelihood that a guest will return to the property in the future and why.
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CHAPTER 3: CUSTOMER SATISFACTION: TURNING YOUR BUSINESS INTO WHAT MEN AND WOMEN WANT
Customer satisfaction drives a customer’s intent to return. Knowing the differences between what men and women
want can give a business an edge to increase repeat business and profitability.
Successful business owners understand the importance of returning customers. Knowing the desires and values of
customers is vital to survival. Many successful organizations now recognize the importance of regularly surveying
their customers. A dedication to the survey process reaps the reward of increased knowledge about customer
behavior and increased profitability.
But not all customers are alike. A recent study conducted by the National Business Research Institute (NBRI)
examined the attitudes of men and women in an on-line survey including 50,000 responses from casino customers.
The survey, which was conducted from February through December in 2006, revealed that men and women are not
identical in how they evaluate businesses.
In this study, NBRI conducted Root Cause Analyses to identify the survey items that are predictors or drivers of
customer behavior. These analyses apply the science of organizational psychology and statistical analyses to business
processes. The result of this advanced technique is groundbreaking information about the drivers of customer
behavior.
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The Root Cause Analysis of the women who patronize casinos identified two root causes of customer satisfaction: the
Rewards Card Program benefits and a good mix of slot machine types. NBRI also uncovered one root cause of
women’s intent to return to the casino—the friendliness and helpfulness of casino staff.
NBRI found the factors driving customer satisfaction and intent to return to be different for the male customers in
this study. Several root causes of customer satisfaction were identified for males. Men want a casino with a lot of
action and excitement where they can have fun. They also want a casino with appealing restaurants and a gaming
rewards card program with good cash bonus rewards and offers. Two factors were also driving intent to return for
male customers: safety of the casino property and a good mix of slot denominations.
Peter Drucker once said, “The aim of marketing is to know and understand the customer so well the product or
service fits him and sells itself.” To know and understand the customer requires rigorous research. The exacting
knowledge gained from customer surveys, such as the one conducted by NBRI for the Gaming Industry, provide
businesses with precise information about customers—both male and female—to ensure a good person-product and
person-service fit for the entire customer base.
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CHAPTER 4: GAMING ESTABLISHMENTS USE RESEARCH TO COMPETITIVE ADVANTAGE
As gaming establishments have increased in number, so has the competition between them. As competition increases
it becomes vital to a gaming establishment’s survival to gain an advantage over the competition in attracting
customers. Just how can this be accomplished?
Through Research
Scientific research provides a competitive edge over the competition whether you own a gaming establishment or
any other business that faces competition for customers. Through research insight is gained into three types of
information that can be used to an advantage over your competitors. The three types of information are knowledge
of:
Customer attitudes;
Customer perceptions; and
Customer behaviors
Wesley Roehl’s research illustrates the importance of knowledge of customer attitudes. Roehl, in an article published
in the Journal of Travel Research, stated that research has shown that users of casino amenities (i.e. gourmet
restaurants, coffee shops, and large-and small-scale shows) spend substantially more money gambling than do non-
users of these amenities. According to Roehl, as competition between casinos increases, information on the role
amenities play in attracting customers and keeping them on-site becomes more important in maintaining a
competitive edge. Surveying customers regularly can keep you abreast of their attitudes toward such amenities and
the role they play in a customers’ choice of casino.
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Knowledge of customer perceptions is also valuable. How a customer evaluates a casino is heavily influenced by
the contrast effect. Psychologists tell us that how we judge a stimulus, whether it is a person, place, object, or service,
is influenced by other similar stimuli we have recently been exposed to. A customer judges a gaming establishment by
comparing it to other casinos he or she has recently patronized, rather than by comparing it to a fixed standard.
You can experience the contrast effect in a dramatic way by exposing yourself to three physical stimuli: three buckets
of water at different temperatures. Take one bucket and fill it with very warm water. Fill a second bucket with very
cold water and a third with lukewarm water. Simultaneously place one hand in the bucket of very warm water and
the other in the very cold water. Keep your hands in these buckets at least 15 seconds. Next simultaneously remove
your hands from these buckets and place them both in the bucket of lukewarm water. Even though the hands are
being exposed to the same stimulus, they will not perceive the water temperature in the same way. The lukewarm
water will feel cool to the hand that has been in the very warm water. However, the hand that has been in the very
cold water will perceive the same lukewarm water as being quite warm. Now imagine two customers coming into
your business, whether it is a casino, restaurant, service provider or retail store, the same phenomenon applies.
These two customers, each with their own unique experiences, will perceive your business differently because each
will compare it to other businesses they have experience with. Thus, the same two customers patronizing your
business during the same time period may form two very different perceptions.
It is critical to have both knowledge of the customer’s attitudes and knowledge of the customer’s perceptions of your
business. When you use scientific research to learn about the customer’s attitudes, you gain powerful knowledge
about the drivers of the customer’s behavior. Learning the drivers of customer satisfaction and intent to return to
your business enables you to tailor your business to the needs and desires of your customers. For example, if you own
or operate a casino, you need to know whether customers are driven by a fun and exciting environment, a good mix
of slot types, or the comfort of the chairs in the casino, among many other possibilities.
Once you have identified these drivers you can then look at how customers perceive your casino based on these
drivers. You can get a limited view of customer perceptions by simply looking at the mean (average) scores for each of
these drivers on your survey. However, mean scores are completely subjective. You will be able to derive objective
meaning from your survey scores only if you can compare your scores with benchmarking data. If you utilize a
consulting firm to conduct your customer surveys, any good firm will have a large benchmarking database to compare
your scores to. A benchmarking database is based on the responses of many other customers to the same survey
questions and informs you how customers typically perceive each item. This provides you with objective information
on whether a particular score is good or bad.
Take, for example, two items often used on customer surveys, “I would recommend doing business with the
company to others” and “Sales representatives are responsive to my needs.” Let’s say that each of these items
received an average score of 3.99 on a six-point balanced scale ranging from “strongly disagree” (with a value of 1) to
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“strongly agree” (with a value of 6). A score of 3.99 would put each item just barely below the “slightly agree” point
which is valued at 4.0. Although the two mean scores are the same, their meanings are quite different as
benchmarking data clearly illustrates. As it turns out, 3.99 is a poor score for “I would recommend doing business
with the company to others” as 3.99 is only at the 38th percentile for this item. That means that 62% of individuals
surveyed gave this item a higher score. However, for “Sales representatives are responsive to my needs” a score of
3.99 is at the 96th percentile which tells us that most customers give this item a lower score. Thus, 3.99 is an
outstanding score in this case. Benchmarking data provides the objective information you need to make profitable
changes in your business.
We have examined the importance of investigating customer attitudes and perceptions. Next let’s look at the
importance of examining customer behaviors. Ultimately, it is the behavior of the customer that a business owner is
most concerned with. Knowledge of attitudes and perceptions are important because they influence behavior. In an
article entitled, “The Science of Decision-making: Behaviors Related to Gambling” published in the
journal International Gambling Studies, Edmund Fantino and colleagues report that a behavioral perspective can be
very useful in understanding the factors involved in a customer’s gambling. For example, for a gaming establishment
it can be helpful to know about behaviors such as how often customers gamble, how much money they typically
spend when they gamble, etc. Even more important is information about a customer’s “percent of wallet.” That is,
how much of their gambling money is spent at your casino and what percentage is spent at other casinos. This
information gives you vital knowledge of your customers’ behavior. Combined with the information you have about
customer attitudes and perceptions, you can use this knowledge to gain a competitive advantage over your
competition.
NBRI has combined knowledge of customer attitudes, perceptions and behavior in a powerful way to help gaming
establishments increase their advantage over competitors. In a unique customer study, NBRI conducted a
comparative analysis between two customer bases: those customers who spent a high percentage of their wallet at
one particular gaming establishment with those who spent a low percentage of their wallet at one particular
establishment. NBRI was able to identify the drivers of customer satisfaction, intent to return to the establishment,
and willingness to recommend the establishment to others in these two groups. For those customers spending a high
percentage of their wallet at one particular establishment, drivers included customer perceptions that the casino was
fun, had lots of action, and was exciting. Comfortable seating in the casino was also a driver for the high percent of
wallet group. In addition, the perception of the quality of the food and beverages sold at the casino was a driver.
Finally, the customers’ perceptions of how friendly the casino staff was drove behavior as well.
NBRI found some similarities when comparing the high and low percent of wallet groups. Like the high percentage
group, those who spent a low percentage of their wallets at a particular gaming establishment were also driven by
their perception of the casino as a fun place with lots of action and excitement. The perceived quality of the casino’s
food and beverages was also a driver for the low percentage group just as it was for the high percentage group.
However, there were also drivers that were unique to the low percent of wallet group.
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These included items related to the player card program and the casino slots. For the player card program drivers
included the customers’ perception of how simple and easy to understand the program was and the value of the
program’s benefits. For the slots, customers were driven by their perception that there was a good mix of slot themes
and a good mix of slot denominations.
A gaming establishment can use this information to influence the behavior of both the high and low percent of wallet
groups. Since they have some common drivers, taking action to improve customer perceptions of those drivers will
increase satisfaction, intent to return, and willingness to recommend in both customer groups. In addition, addressing
the drivers that were found to be unique to the high percent of wallet group can help ensure that these customers
continue to spend the majority of their gambling money at that gaming establishment. Taking action to improve the
perceptions of the low percent of wallet group on the drivers that were unique to them can lead to a change in the
behavior of this customer group. As their perceptions of their drivers improve for that gaming establishment, they will
want to spend more time at that gaming establishment and will increase the percentage of their gambling money
spent at that casino. In this way the gaming establishment gains an advantage over its competitors.
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CHAPTER 5: GETTING THE MOST OUT OF YOUR CUSTOMER RESEARCH Regularly surveying customers is a common practice among successful companies. Customer research is a
complicated process that requires an investment of time and money. Many companies outsource customer surveys to
survey research firms for three reasons:
It saves time;
It saves money and, most importantly;
It leaves survey design and analysis in the hands of highly trained professionals
Why do companies make this investment in customer research? Because they believe that knowledge of customer
behaviors, attitudes, and perceptions can lead to increased profits. However, there are two different types of
research—basic and applied. If you conduct basic research with your customers what impact will it have on your
profits?
None
In order to have a positive impact on profits, you must conduct applied research. What is the difference between
basic and applied research? In science, basic research is research done solely for the pursuit of knowledge. It is
conducted when a scientist simply wants to know more about a certain phenomenon. Applied research, on the other
hand, is conducted to solve a practical problem. Since customer research is conducted in order to gain knowledge
about customers that can be used to increase profits, it is applied research—at least in theory.
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Applied research must actually be applied or used to qualify as applied research. When teaching introductory courses
in psychology and sociology, during the first week of class I explain the scientific method to my students. I will
describe the steps of identifying a research question, selecting a method, and collecting and analyzing the data. At
this point I will typically ask the class, “Once I have analyzed the data, am I finished with my research?” Even
introductory students know the correct answer to this question is “No!” When I ask them why I can’t just analyze the
data and then lock my results away in a file cabinet, they correctly respond, “Because then no one will know about
your research and if no one knows about the research it cannot be used.”
Simply learning about customer perceptions is not enough. Unfortunately, some companies conduct customer
research, look at the results, and then file the report away without ever taking action. Thus, what they have actually
conducted is basic research—they have learned some interesting information about their customers. However the
information is of no real value. Something must be done with the information. But what?
Let’s examine how customer research has been applied in the gaming industry. Recently there has been an emphasis
in the gaming industry on using customer research for customer relationship management (CRM). CRM involves
tracking customer behavior for the purpose of developing relationship building and marketing programs that bond
customers to a brand. CRM is used in casinos to identify preferences, demographics and other measures to predict
customer behavior and customize marketing efforts. In an article published in the Journal of Revenue and Pricing
Management, Rom Hendler and Flavia Hendler described how CRM can be combined with revenue management to
maximize profitability. Casinos are using customer research to determine the destination, dining, and gaming choices
of their customers. This information is used to build complimentary and special offer programs that are customized to
the individual customers. Customer relationship management enables the casino to determine the resources to be
allocated to a customer based on their value. The customer’s value is typically based on their theoretical revenue (the
total amount wagered multiplied by the house advantage) and/or their average daily theoretical revenue (ADT)—the
total revenue divided by the number of days a player gambled. After assessing a customer’s profitability, the casino
can customize offers and determine how much the customer is eligible for in complimentary rooms, tickets, gifts,
discounts, etc. The reinvestment is usually a percentage of the customer’s estimated theoretical.
Casinos typically obtain the data used for customer relationship management through gaming rewards programs.
Each customer enrolled in the program has a card that enables the casino to keep track of their demographic
information, their gaming behavior, and their spending in the casino’s restaurants and other entertainment venues.
As stated earlier, this information is then used for revenue management and determines the comps and special offers
given to the customer. While this approach to customer research is applied and does have some impact on profits,
you must go beyond this to get the most out of your customer research. This micro level approach will be ineffective
unless the customer returns to the casino. Whether you are operating a gaming venue or any other type of business,
you must keep customers coming back in order to maximize profits. So how is this accomplished?
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By utilizing applied research at the macro level
To maximize the effectiveness and profitability of customer research, you must conduct applied research that will
keep your customers coming back to your establishment. Research of this type examines the attitudes and
perceptions of your customers and then, using cutting edge statistical techniques, identifies the specific issues that
must be addressed to increase customer satisfaction and intent to return to your business.
In the scientific literature you can find studies that come close to this approach to applied research. For example,
Anthony Lucas and K. Pearl Brewer, from the University of Nevada in Las Vegas, examined how a hotel casino can
manage slot operations using applied research. Their study, published in the Journal of Hospitality and Tourism
Research, was designed to identify and explain the sources of variation in the daily slot handle (i.e., the amount of
money wagered in all the slot machines) of a locals’ market hotel casino in Las Vegas. Their results helped the casino
under study improve their marketing efforts to increase profitability by using inferential (predictive) statistics. Lucas
and Brewer’s research showed the hotel casino management that some of their beliefs were incorrect and some of
their approaches were ineffective. For example, the casino management believed that food covers drove the slot
business in a locals’ market casino however; the research showed that it was not significantly related to slot handle.
The casino was also aggressively advertising and promoting its restaurant business at the time of the study. However,
it recorded a net loss on its departmental income statement in the food department. Since the research revealed that
the effect of food covers was not significant in influencing slot handle, the casino’s management was advised to
reconsider their use of food covers.
Such studies in the literature can provide some insight into customer behavior but the information cannot be
generalized (applied) to other businesses, even within the same genre. Human behavior is extremely diverse and
dynamic. If you want to utilize science to help you understand your customers and predict and influence their
behavior, you must conduct applied research with your customers. Conducting applied research with your own
customers on a regular basis will enable you to identify the dynamic drivers of their behavior. You can also identify
the drivers of customer satisfaction and intent to return for every key segment of your target market.
Recently, NBRI conducted customer research for a large gaming company. NBRI utilized the gaming company’s
customer database to conduct customer research that identified the key drivers of customer satisfaction and intent to
return. Recall that this information is vital because customer relationship management is ineffective without it—you
have no relationship with a customer unless he or she continues patronizing your business. Not only did NBRI identify
the key drivers of customer behavior in general, but they were also able to conduct analyses based on customer
average daily theoreticals. Recall that part of CRM is using ADTs to determine the comps and special offers given to
customers.
In this study, customer behavior was analyzed by three card types based on ADTs. Card type “A” includes customers
with ADTs of $300 or more. Customers with ADTs ranging from $100 to $299.99 were classified as card type “B” and
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those with ADTs from $20 to $99.99 as card type “C.” A proprietary Root Cause Analysis (RCA) was utilized to identify
the drivers of overall satisfaction and intent to return for each card type. The RCA uses a combination of regression
analysis and a psychological path analysis to identify the drivers of customer behavior.
For card type “A,” both overall satisfaction and intent to return were driven by customers’ perceptions of the casino
being a place where they have fun. Overall satisfaction for card type “B” was driven by the customers’ perceptions
that the casino had a good mix of slot machine themes and by how appealing they perceived the casino’s restaurants
to be. However, intent to return for card type “B” was driven by their perceptions of the wait time at the player
rewards card center and by how fair they perceived the comps earned based on play to be compared to those at their
other favorite casino. For card type “C” overall satisfaction was based on the customers’ perceptions that the casino
had a lot of action and excitement. It was also based on the friendliness and helpfulness of the restaurant staff and
the perceived value of the gaming rewards program benefits. Intent to return for card type “C” was driven by the
customers’ perception of feeling lucky in the casino. Friendliness and helpfulness of the restaurant staff was also a
driving factor for intent to return for card type “C” as was the perceived quality of the food and beverages in the
casino’s restaurants.
This information can be used by this gaming company to take actions that will increase overall satisfaction and intent
to return for customers of all ADT levels. Taking actions to increase satisfaction and intent to return will make any
micro level or customer relationship management efforts more effective. This type of applied customer research is
vital to the success of any business.