BUSY IS NOT A STRATEGY WHEN IT COMES TO PROMOTIONS
Our partners at Raving Consulting are experts in the most similar market to Australian clubs – USA Tribal casinos. They have the same issues with high visitation of regular customers and balancing gaming promotions that aren’t just foot traffic and don’t convert to revenue. Here are their tips on avoiding “busy” as a promotions strategy.
“Busy is not a strategy.”
Know Your “Why” for Each Promotion
Every promotion should have a reason for existence, and it doesn’t matter if that is the weekly kiosk game or the new car giveaway at the end of the month. The promotion should have goals, a budget, guest lists, and targeted revenue and profitability. This is the information that we populate the pro forma with and what we, as marketers, will hold ourselves accountable to at the end of the day. Now, I know a group of you out there just got nervous and said to yourselves, “we don’t do this.” It is going to be okay. All I am asking you to do is start the process the next time that you sit down with your team to plan out promotions. It will take a few iterations to get the process going, but at the end of the day you will be in a better place and create far better promotions once you start this process.
Armed with our pro formas, the marketing team executes all of the promotions flawlessly during the month, and guests rave about how great the promotions were. The month wraps up, and the real work begins on understanding precisely what worked and what didn’t when it comes to the profitability of the promotions.
Power in the Pro and Post Forma
When building the promotional post forma, it is essential to have more than just turnover, win, promotional cost, and profitability. To help with future planning and understanding the overall profitability of the month, we always encourage adding players mailed, players redeemed, redemption rate, trips, walk rate (players redeemed with no play), and the layered costs of the promotion. What is a layered cost, you might ask? The easiest way to explain it is by using common examples: Do you have a two-for-one promotion in your restaurant the night of a primary promotional drawing? Does your weekly triple points promo fall on a day when you have a monthly kiosk game running? If either of these examples rings true, you likely have layering within your programs. The layering itself is often not the issue, rather it is the fact that it gets lost on most promotional post formas. We encourage our clients to break out these costs on their own line so that it is obvious what the costs are and how they affect the promotion. We like to include other points, comps, other promotion costs and food comps, to name a few.
With all of the information from above, we have the data points necessary to build our modified post forma. Starting with the actual win (turnover should just be used as a data point), from our group of guests we can begin subtracting the actual and layered costs from the campaign and get to true profitability that everyone can agree upon. Furthermore, comparing these numbers to the pro forma will help the planning process for future promotions and help make you a better marketer.
Use these concepts to build better promotions and then move on to every other aspect of marketing to build a data-based system rather than having gut feelings.
Source: Written by Bryan Brammer – Busy Is Not a Strategy When It Comes to Promotions – Tribal Gaming and Hospitality Magazine (tgandh.com)
