The best marketing strategy for casinos starts with the foundational understanding of the three phases of player lifecycle: Acquisition, Maximization and Retention. Today’s marketing teams have spent decades building out robust multi-channel strategies to tackle the Acquisition and Maximization phases of the player lifecycle. Nearly every aspect of today’s marketing activities, from brand awareness to segmented and even 1:1 promotions, are all focused on these two lifecycle phases, leading to casinos fighting tooth and nail with regional competition for the smallest of competitive advantages in each area.
What we’ve found, though, is that the third phase – Retention – is almost universally under-appreciated and often outright ignored. This is a shame because retention strategy provides by far the best return on investment. This blind spot in the casino industry is a huge opportunity for early adopters of the lifecycle-based marketing strategy to capitalize on a market segment that everyone else is ignoring. Divert marketing resources toward retaining players who have recently disengaged with your business, or are just about to do so, and watch your competitors scratch their heads as your player base explodes.
While the retention phase has by far the most low-hanging fruit, it is filled with its own complexities both from a data measurement, collection, and evaluation standpoint. In the entertainment industry churn is necessarily a fluid concept. Unlike, say, a cable company, there is no predetermined touchpoint where the customer decides to either renew or disengage. Rather they can choose to “renew” by visiting again – or not – at any moment. This means that the best definition of “churn” is just a best guess. A churned player could walk back in the door tomorrow of their own accord. That player you haven’t seen in 90 days? Maybe they were planning to visit tomorrow with their friends, or maybe they moved across the country. We can only know for sure in retrospect.
Luckily, we have the benefit of retrospect with advanced data analytics tools. The behavior patterns of individual churning players may seem erratic, but at a macro level they begin to make sense. That is why strategic marketers use churn rate to measure the efficacy of retention campaigns. Your player churn rate takes the aggregate of all those individual player decisions and illuminates the commonalities between them. Armed with this metric you can now drill down to the individual player level and make strategic decisions to retain an individual or a segment of players.
With our casino gaming analytics product, Gaming Analytics makes it easy to make strategic decisions to retain your player base. If you would like to learn more about customer retention for casinos, give us a call at (702) 355-5377 or email firstname.lastname@example.org.