State of Play : State of Play - Issue 1
STATE OF PLAY | ISSUE ONE and inclined to stay. “Ideally, you want your customers to feel almost like they’re sitting in their living room, but better,” says Oliver. REVAMP YOUR LOYALTY PROGRAM “Venue loyalty programs have proven their worth as an effective method of keeping connected with core customers,” says O’Sullivan. According to Roy Morgan Research, 71 percent of Australians are members of at least one loyalty program. The value of a well-run loyalty program lies not just in attracting and keeping customers, but in developing a quality database, increasing brand awareness and lowering overall marketing costs. Customers who see benefits from a program tend to have reduced price sensitivity while holding stronger attitudes towards their venue of choice. The database of a good program yields valuable information about customers and consumer trends, allowing operators to target communications to the most profitable segments. A high-revenue customer is always preferred over the more frequent, but lower spending customer. Reward programs should always be geared toward the former and rewards based on customer profitability. “A good loyalty program will not only attract customers into the venue at particular times. It also means venues can benefit from customer feedback – helping them make informed decisions about their venue layout, food offering, gaming machines and identifying what makes customers want to stay longer.” says Oliver. The innovative operator will constantly evaluate the success of their loyalty program and adjust as necessary. Should the program be open to all customers or only to a select group? How and when should rewards expire? Are there alternatives that are more flexible and less costly to implement? ANALYSE YOUR FLOOR Most venues receive 60 to 80 percent of revenue from the gaming floor. A savvy manager constantly audits machine performance to determine which machines are providing optimal returns and those that need to be replaced. People are naturally drawn to new and novel. Professor Harvey claims this is rooted in evolution. “In prehistoric times, novelty-seeking behaviour in relation to food variety would be more likely to produce a nutritionally balanced diet,” he says. “Today it may not be so important from that perspective, but we have learned to value variety. Consequently, consumers are still attracted to variety.” It is not just the variety of machine that matters, but also the layout of the floor. Strategic managers work with experts on a configuration that will maximise revenue by encouraging customers’ participation while complying with the jurisdiction’s operational requirements. “The importance is getting the right game, placed in the right location, at the right venue,” says Oliver. “What’s popular for one venue and their demographic may not be right for another.” Managers should think about longevity rather than the latest fads. Venue operators who concentrate on, and invest in, these three core aspects of their business will be rewarded with a revitalised atmosphere and an increase in patronage. ■ MANAGERS SHOULD BE THINKING ABOUT LONGEVITY RATHER THAN THE LATEST FADS.
State of Play - Issue 2 Vic