Casino operators continue to face a challenging landscape due to low, and fluctuating, growth in the U.S. economy and an ever-more competitive environment.
Now more than ever, operators need to better understand their customers’ needs and desires to successfully drive bottom-line results.
However, many consumer gaming studies have attempted to understand customer spending decisions only by analyzing play by gaming type and destination, in order to develop descriptive statistics, demographic profiles and market-size estimates. Few if
any studies have examined in depth how customers make visitation decisions to begin with and which factors in particular most influence their gaming activities.
To bridge that gap, AlixPartners recently surveyed over 2,000 casino patrons to determine the underlying drivers of their gaming and destination decisions, with the goal of developing predictive models that can drive actionable results for gaming operators. The survey asked a variety of questions to determine what factors drive respondents’ decisions of where to play. The respondents were also asked their views of how the gaming industry is currently performing. The five main factors considered were:
• Access: The ease of reaching the gaming destination and navigating the property;
• Experience: The overall satisfaction with the visit, including gaming, entertainment, lodging, and food & beverage;
• Value: The satisfaction derived compared to the total cost of making the visit;
• Service: The degree of employee attention, professionalism and guest assistance provided; and
• Gaming: The degree of satisfaction with gambling-specific attributes, including wagering levels and breadth of options.
When comparing the “importance” ratings consumers applied to the various factors versus their evaluations for various operators’ “performance” against those factors, the results indicated that the three biggest areas of improvement for operators are:
• The availability of gambling options at desired wagering levels;
• The availability of “preferred” (gaming-type) tables and machines; and
• The opportunity to earn rewards and participate in promotions.
This third factor is of particular interest as the survey indicated that 75 percent of respondents are influenced by rewards—i.e., loyalty programs—when choosing where to play. Additionally, as shown in the nearby chart, almost 50 percent agreed that loyalty programs are the primary influence in their casino selection. As to why loyalty programs are not meeting customer expectations, respondents believe operators can improve the attractiveness of their rewards and do a better job of tailoring promotions to customers’ individual gaming and purchasing preferences.
With many forecasters predicting that gaming-industry revenues will remain flat, or even potentially decline, in the next few years, it will be critical for gaming operators to better understand their customers’ needs and desires. The survey indicates that gaming operators may not be meeting customer expectations of the availability of gaming tables and/or machines at their desired wagering levels. Additionally, the survey shows how critical a loyalty program potentially is to a customer’s decision in where to play. The gaming operators who can improve the linkage between play, promotions and customers’ needs and desires are likely to be most successful in this challenging environment.
The opinions expressed are those of the author(s) and do not necessarily reflect the views of AlixPartners LLP, its affiliates, or any of its or their respective other professionals or clients.