Las Vegas Strip Recovery Under Way
February 25, 2011 by Stics·
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Casino Stocks Rise from Recession Lows
The Las Vegas Sun reported that the gaming industry recovery on the Las Vegas Strip will continue this year and accelerate in 2012 according to a prediction by, Moody’s Investors Service in a recent market update.
Wynn Casinos, Las Vegas Sands and MGM Resorts have all shown huge gains in stocks from their March 2009 lows, outstripping even the solid performance by the broad market. Las Vegas Sands (LVS), Wynn Resorts (WYNN) and MGM Resorts (MGM) are up 3,299%, 722% and 546%, respectively, but they are still not close to their 2007 highs.
Does this prove that people are feeling better and ready to gamble again?
MGM M Life Utilizes Innovative Customer Loyalty Program
January 7, 2011 by Stics·
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MGM Generates Complete Customer Profile Across the Brand
In today’s economy, brands are finding new ways to be smart about attracting customers. Las Vegas casinos have always offered marketing promotions and comps such as free drinks, hotel rooms or tokens to keep customers coming back.
None, however, have gone as far as the new customer reward program from MGM Casinos M Life. This new customer loyalty program for MGM has found an innovative way to reward their customers and build brand loyalty.
Rather than focusing solely on customer’s gambling patterns, MGM tracks members of their reward program across all resorts and all facets of their hotels, including clubs, dining, spas, shopping and gambling. MGM then uses this information to offer its customers perks targeted to their personal interests. For more information on the program visit the M Life site or this recent Las Vegas Sun article about M Life.
Stics is pleased to have a number of MGM properties as Stics Predictive Analytics clients. MGM has a very strong marketing organization and they are always looking to improve their marketing strategies and tactics. As marketing optimization experts, Stics understand the complexities in executing multi faceted marketing program and expect the M Life approach to further enhance MGM Casinos revenue retention while building stronger brand loyalty with high value guests.
Flat is the New Up
December 10, 2010 by Stics·
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The Decline in Casino Gambling Leveling Off
Upon approaching the bottom of the market, we noticed that flat casino gaming revenues were being carried like a badge of respectability and even a harbinger of hope. Over the past year, Stics conducted three market surveys, of U.S. based casino, to better understand the challenges and needs of casino marketers and the gaming industry.
Our primary research confirms what you may have suspected:
- Fully 63% of the market finds their revenues down or flat.
- Pockets of actual “up” markets exist where geography and competition permit
While this is not good news, there is a general sense that the decline in casino gambling has leveled off.
One, of many current challenges, is how to effectively and efficiently re-engage profitable gamblers. Most properties are working hard at this problem, but sometimes that is not enough. If you are looking for a new way to increase revenue at your casino property Stics predictive analytics has a proven track record for increasing ROI.
Feel free to call us for more information.
How to Tell What Your Customers Want
August 1, 2010 by Stics·
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Past Behaviors: Misleading Facts
When we make guesses about the future, we usually go off past behaviors. But people change their minds frequently. So even if you know what your customers bought in the past, you cannot necessarily predict what they will buy in the future ― from their past behavior alone.
To illustrate that point, let’s look at Bob, Carol, Ted and Alice. We want to know if we should be marketing SUV’s to these people. From our customer records, we know they bought an SUV in the past.
As you can see from the chart, the traditional SQL (Structured Query Language) a
nswer correlates their past behavior with a recommendation to market to these people. But this approach falls short compared to the deeper statistical answer, because it only evaluates a limited set of the available data.
- For Bob, both the SQL and statistical answers are in agreement, telling us that he is worth marketing to because he is an SUV buyer.
- For Carol, the two answers lead to opposite conclusions. Perhaps she no longer needs one because her kids are grown. Maybe it’s something else that changed?
- Both Ted and Alice have some chance of buying an SUV having never done so previously.
- But Alice has a much higher probability of buying one. Perhaps she is starting a family or taken up a new sport that an SUV would be good for. Without statistical analysis, we would not know that Alice is worth marketing to.
Predicting the Future
The better way to make predictions about future behavior is to use a statistical model. A statistical model can take many complex inputs and produce outputs, like the probability of someone buying an SUV in the future.
The important difference here is that statistical models can respond to all the details within your data. This is superior compared to using generalities or segments of your data, like the “previously purchased” example shown above. By using statistical models rather than a traditional SQL approach, your will gain a better view of your customers and better refine your marketing efforts with increased accuracy and profitability.
This is one of the reasons why Stics statistical models improve marketing performance above other methods. Stics can provide customized statistical insight about your customers – and use less time than traditional segmentation models take to make. Plus, Stics has years of experience and the technological tools to quickly and reliably give you the information you need.
How Averages Can Be Dangerous
We use averages in our business life all the time, and they are usually pretty straightforward. However, when it comes to making business decisions involving customer data, averages can be misleading.
Let’s say that we had a sample of 100 gamblers from your customer re wards system. From your current database analysis tool you can learn that their average income is $55K per year. So from that information, you might assume your typical customer has an income of $55K and act on that assumption, by building a marketing campaign targeting customers with an income of $55K. When you imagine averages, you probably think about a curve like this:
The problem is there are other kinds of curves with the same average as the one above, but they have wildly different distributions and implications for your marketing campaign. For example this chart shows a flat or what statisticians call a uniform distribution which would be bad news for your marketing campaign.
If you are an optimist about your gambling population, you might think you have a narrowly grouped base around $55K like this chart.
And if you are unlucky, some day you might experience this unfortunate distribution and none of them have an income of $55K as seen in this troth shaped bi-modal chart.
The important thing to note here is that all these graphs have the same averages, so if you were relying on averages alone to make decisions for your business, your success would be at risk. With misleading data, you may be spending thousands of dollars marketing to unprofitable customers and overlooking potentially valuable ones.
Distributions Matter
Averages don’t matter as much as the distribution around the averages, when it comes to finding ideal customers. Distributions give you a fuller picture of where your customers are and just as importantly― where they are not.
The way to the right people is to use more information, specifically, to use all of the distribution and not just the average. Predictive analytics is the clear winner for making more profitable decisions, because it uses all of the information in the distribution. Predictive analytics is a more complex way of looking at potential consumers, taking into account their past behavior and predicting whether or not they would be receptive to the product or service you have to offer.
To use predictive analytics, you could start studying distributions, send your staff to statistics classes or start benefiting immediately from Stics. The professionals at Stics have made it easy for people who aren’t knowledgeable about statistics to get the important information they need for their company. Stics has predictive models that can give you valuable information about your customer information― which will lead to more profitable marketing campaigns.
The Data Fact Gap: What You Don’t Know Can Hurt You
June 18, 2010 by Stics·
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What the Data Fact Gap Means for You
Fact Gap Graph
As professionals, we all know that technology has changed the way we do business. Whether you find the increased dependence on new technology as good or bad often depends on how effectively the tools are used. Over the years, this problem has been illustrated in many ways by me and by others. This particular Fact Gap illustration was first attributed to the Gartner Group. It will help me describe how data technologies are, on the one hand, progressing and on the other, creating new data analysis problems.
The Data Fact Gap was created by the explosion of available digital information accumulated in recent years. With technology system advances, increased data storage capacity and Internet usage it is now easy to collect mountains of data. While the volume of retained data has grown exponentially and spread across all industries, so have the data management challenges it created and the even greater marketing opportunity that mostly lays dormant.
This abundance of data creates new problems that force database marketers to devote a lot of time and resources to filtering information into data segments so decision makers can frame a concept, problem or question. While this approach is intuitive to the human brain, it does limit our ability to make a fully informed decision from all available data.
Why You Need Good Data
Intuitively we often think we already know what our customers want. However, that is not always the case. When we make business decisions by filtering our data down to a few variables we miss the more accurate and complete view of the data. Without hard data, there’s no way to be sure truly objective decisions are being made. Worse, because we think we’re making objective decisions, we often don’t seek outside an perspective.
What we really need is an objective analysis, wielding as many customer factors and data points as possible. This approach helps us see the potential hidden below the common database marketing analysis.
Statistical Predictive Analytics Solves the Problem
One way to harness the data explosion and make better marketing and business decisions is to use predictive analytics. Predictive analytics uses the science of statistics and is capable of considering unlimited facets of a situation. Predictive analytics for marketing can increase a marketing campaigns return on investment by ten times compared to a typical SQL analysis that might only evaluates about five variables. It takes the data that you already have and give you information you can use in your marketing campaigns, such as:
- Customers you are currently marketing to, who are unprofitable
- High value customers or prospects you are not marketing to
- More profitable marketing programs
- Respective value of various members in your customer base
Statistical modeling with predictive analytics is proven to help make more informed decisions and increase profit margins.
In my business, we live on the front lines of customer data knowledge generation and have a deep understanding of the problems and opportunities created by the data explosion. For that reason, we discourage installing expensive applications that might not provide quick answers to important questions that drive revenue and profitability. We know that with seasoned expertise, a leading statistical technology platform and focused services like ours, it is possible to bridge the data gap and quickly and easily improve the performance of your marketing campaigns.
Stics offers innovative solutions that provide deeper insight into your customer and loyalty database for greater marketing return on investment. We welcome inquiries and are happy to answer questions.
