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14 March 2015
By Martin R Baird
Don’t you wish there was an app that, with a couple of clicks, you could use to fix the problems facing casinos?
Well, there is no such app. But there are three critical problems that casinos must face head-on if they want to survive (yes, survive) and, ultimately, succeed. And there is one overriding solution – exceptional casino customer service.
Problem No. 1 – The gaming industry is more competitive than it ever has been in history and there is no let-up in sight. The next couple of years will bring casino competition to a level never experienced before.
With more choices, guests are exceptionally demanding and that means “good enough” is simply not good enough. Have you heard the rumor that Russia would like to turn Crimea into the Macau of the Black Sea? This is no joke. There are stories circulating that Putin wants to follow the same model to create a gaming destination on the peninsula. Or what about Osaka being the first city in Japan to have a casino?
In the United States, many states are starving for tax revenue and they will do anything to get it. This means states that said they would never have gambling are now considering it. Other states that have come late to the party with hopes of a huge windfall are often left struggling. They waited so long that there just aren’t enough people to grow the business to match revenue projections.
Look at what has occurred in Michigan, Ohio, Pennsylvania, Maryland, Virginia and Delaware. I lived in Maryland for several years when the only local casinos were in Delaware and West Virginia. When I visited those properties, three out of four cars were from Maryland. Now all of these states have wonderful casinos that are all fighting for the same guests. Why would a person living in the Baltimore area drive to Delaware or West Virginia to play? The answer is they don’t. All of these states and casinos are now competing for the same guests.
What about Internet gaming? I recently read that New Jersey casino tax revenue was not as low as expected because of the increase in Internet gaming revenue. If New Jersey is generating tax revenue from online gambling, how long will it be before other states jump in, too?
When push comes to shove and lawmakers have the choice to cut spending, raise taxes or legalize more gambling options, which path do you think they will take? Politicians don’t cut spending. They also don’t raise taxes if they want to be re-elected. So the most viable option is to add more gambling options.
Problem No. 2 – Another challenge: the world economy. China’s economy is soft, if not weak. There are reports that China has an over-built housing market and economic growth is at a much slower pace than the last 10 years.
The saying goes, “When the United States sneezes, the world catches a cold.” The idea is that the U.S. is so powerful, it affects the entire world. Today, the same can be said for China with its 1.35 billion people. Economists are predicting that China is in a housing bubble that is going to burst. Remember what that did to the U.S. economy? Think about what it has been like for the last several years!
If the Chinese economy has a significant downturn, that will have an impact on the U.S. economy. Many U.S. companies have significant exposure to China and rely on sales within that country for growth. These companies are major employers in the U.S. That is a global problem, but most of the U.S. casinos are more focused on people within a two-hour drive of them. How are the people in the neighborhood doing?
While there are pockets of economic strength in parts of the country (consider oil-rich North Dakota), the U.S. economy is soft. This makes it very difficult for the average consumer to feel confident and want to go out and spend money… if they have it to spend at all.
Given these global, national and local challenges, casinos need to work hard to survive, and they need to work even harder and invest smarter to thrive.
Problem No. 3 – As I said, there’s no app for service excellence. There isn’t a magic app in the cloud that you can click on and turn customer service zeroes into heroes. Great service takes a proven system and a commitment. If you want your casino to provide exceptional service, it takes developing your people.
Given the problems of competition and a lackluster economy, exceptional service is critical. It’s that simple. Increased competition gives guests the power to be particular. Guests will not visit a casino that has just good or acceptable service. Why would they waste their time and money on good when they can have exceptional?
There are no apps to fix the myriad problems casinos are facing, but there is a solution. The solution isn’t easy and it will take time, effort and investment, but it is worth it. The solution is service improvement.
It always shocks me when a casino will say it can’t spend money on improving its customer service. I shudder at this excuse because I know the way this movie ends. Poor service means fewer guests. Fewer guests mean less revenue. There simply is not a simple or easy fix to these problems.
If you've read this far, then I believe you have a passion for service excellence. Remember, programs don’t last! You want a culture of service excellence and cultures take time to build.
Martin R. Baird is chief executive officer of Robinson & Associates, Inc., a consulting firm to the global gaming industry. Robinson & Associates is a member of the Casino Management Association and an associate member of the National Indian Gaming Association.
This article is provided by the Frank Scoblete Network. Melissa A. Kaplan is the network's managing editor. If you would like to use this article on your website, please contact Casino City Press, the exclusive web syndication outlet for the Frank Scoblete Network. To contact Frank, please e-mail him at email@example.com.
28 February 2015Wouldn’t it be great if casino employees inherently knew how to provide outstanding service for their guests? They could just work the floor and do their thing, much to the delight of people walking through the door. While some employees seem to have a natural talent for providing service, most are not born with the customer service gene. ... (read more)
14 February 2015I’ve been helping casinos improve the quality of their customer service for more than 20 years and I’ve been writing about the topic of customer service just as long. Occasionally, I like to let other people speak for me just so readers can see that I’m not making all this stuff up. This is one of those occasions. ... (read more)
8 November 2014I was at a gaming conference and an industry marketing consultant talked about a publicly traded gaming company that spends 37 percent of its revenue on marketing. I know of a property in a very competitive market that spends more than $1 million a month on marketing. Why all this spending? Casinos say they need to be seen to keep guests coming through the door so they can grow. ... (read more)
Martin R Baird