5 Ways Casino Hotels Transform Big Data into Big Revenues
Two decades ago, only two states had legal gambling in the United States. Today, those statistics have flipped. Now, it’s only Hawaii and Utah that have bans on all forms of gambling.
NB: This is an article from Rainmaker
As a result, today’s casino hotels are challenged with greater competition than ever. And hotel operators are turning to advanced technology solutions to help manage the all-important task of transforming big data into big revenues.
Getting Granular with Guests
By collecting more comprehensive customer data and deeply mining that data, you ensure you’re attracting and retaining your most lucrative guests. Value your guests more holistically, beyond analyzing each customer’s average daily theoretical (ADT), by leveraging spend data from across all your profit centers, including the spa, retail outlets, golf courses, and nightclubs. Proper analytics let you segment guests at the most granular level, flexing and flowing your business mix to maximize profitability. You can also adjust your strategy in real time based on demand, no longer losing out on profits by filling your rooms in advance with lower-value guests.
Reinvesting the Right Way
Many casino resorts have a predetermined number of rooms to comp, and when they’re gone, they’re gone. A much more effective approach is to differentiate comps and your reinvestment strategy based on the true worth of your guest. This prevents you from reinvesting too much in lower-tier customers. Furthermore, with the right technology solution in place, you can adjust reinvestment on a continuous basis, adapting it for holidays, group business, and in accordance with daily fluctuations in demand. Sometimes, only a slight reduction in comps, or being a bit more selective with your discounting strategy, can lead to dramatic increases in revenues.
Future-Proofing with Forecasting
Advanced analysis of historical and real-time data can be used to shape more accurate forecasting of guest value and demand throughout all areas of your enterprise. Each demand stream you face should be forecasted independently then optimized together to yield best results for your resort. Improved forecasting capability lifts profits by accurately and instantly determining the minimum acceptable value of each guest. And by leveraging cyclical patterns, you maximize revenue during peak times. In order to truly future-proof your business, forecasts should be run nightly, so each morning your team is presented with a new view, looking forward several hundred days into the future.
The house definitely doesn’t always win when relying on pre-determined marketing strategies and static direct mail offers to incentivize guests. As previously mentioned, big data leads to better segmentation of your audiences. Get the most bang for your marketing bucks by collecting and analyzing data about guests from multiple touchpoints. Then slice and dice that data to create personalized marketing interventions that profitably speak to each player’s unique preferences.
Strategic Pricing with RM
Technology helps casino revenue managers strategically price and protect room inventory to generate the most profit. With increased access to a guest’s ADT and overall spend, revenue managers can adjust rates based on a guest’s value to the property. All customers are important, but one playing high-stakes games and drinking top-shelf liquor needs to be handled differently than one playing penny slots and drinking only water. And while gamblers were once considered the most profitable customers of casino hotels, today’s highest-value guests may not gamble at all. With the right revenue management system, you ensure that your higher-rated guests (gaming or non-gaming) are driving month-over-month profit increases.
Casino hotels have complex needs. Multiple divisions operate according to different principles on different daily cycles. Effectively organizing and analyzing big data allows managers to see the quickly changing big picture in real time. Insights and opportunities are more easily revealed, allowing managers to make the best business decisions for improving guest satisfaction and a property’s overall financial performance.