For the fourth episode of Loylogic’s podcast, we’re joined by David Slavick, Co-Founder and Partner of Ascendant Loyalty, to discuss innovation in iGaming and Casino loyalty.
David is one of the world’s pre-eminent leaders in the iGaming and casino loyalty space and, with the discussion taking place shortly before the G2E event in Vegas, we focus on one of the hot topics at the event: how gaming companies can drive growth through loyalty.
Too often, gaming companies rely on what worked 10 years ago as the formula for recognizing and rewarding valuable players of their casino, or igaming enterprise. In short, complimentary meals, hotel stays and free tickets to shows, no longer do enough to truly demonstrate how important the player is to the business.
This episode provides insight into how best to achieve true emotional connections with players, in order to achieve a loyal bond that accomplishes retention, preference and advocacy – making it a must listen for anybody involved with player loyalty.
We’ll learn:
- What the hottest topics are in iGaming and Casino play
- The undeniable impact of Gen Z
- The common problems David is helping his clients solve
- The importance of feedback and measurement in building emotional attachment
- Why standing still with gaming loyalty is not an option
- The importance of personalization in rewards
Listen to the podcast in full here, or read the transcript below.
(1:40) What are the hottest topics in the iGaming and casino sectors?
iGaming is the high growth area, with streaming, and physical properties like MGM doing iGaming, plus companies like DraftKings or FanDuel all trying to go and capture that dollar or whatever currency it might happen to be.
Legislation has continued to allow gaming and betting activity, because they see the tax value that's associated with it. And amazingly, even in parts of the world like the Middle East with a Muslim population where it's actually not allowed for the Muslim population to gamble, there's recognition that the expatriate population that's resident is looking for entertainment value. And so gaming commissions are being created in the UAE, which is right next door to Saudi Arabia. Now that could be private, off of a mobile phone, or it could be even creating a land-based casino. It's amazing how this industry is continuing to evolve and grow and the demand is significant.
However, as you said in your introduction, the tried and true practices of getting an upgrade to a room or getting free tickets to a Celine Dion show, or a YouTube show, [don't do enough to drive loyalty]. I don't know if you saw the latest, but they just opened up an indoor outdoor venue in Vegas that's unbelievable. It's the largest screen in the world. And they just kicked it off. I think last night, and I'm going to Vegas next week for G2E, as you mentioned, I may try going and getting a couple of tickets!
(3:45) Taking what you've said there about the trends in iGaming, and the casino sector, from a loyalty perspective, what are your clients asking you to share insights and recommendations on?
The loyalty aspect is associated with what the THEO is, or the theoretical win loss of the player. And you understand player potential in terms of profit and loss. Obviously, responsible gaming is very, very important. So there is a real push-pull or a concern on the part of any gaming company that's engendering loyalty and wants the player to feel value. They ultimately want to use the loyalty program to make them have an emotional connection and feel valued with any kind of perks and benefits and experiential rewards and so on. But at the same time, you want to be respectful and encourage the player to be monitoring their own behavior because you don't want them to wind up in a problem relative to betting more than they can lose.
So what they're asking us to do is to improve the overall experience in terms of benefits, in terms of access, in terms of personal attention. Gaming companies have done a really good job with the top players in terms of personal attention. Get a free round of golf, get free tickets to the show, get up front seats, even offering free cruises or jump on a private plane with 30 other couples and go overseas and go on a cruise, etc. And then obviously on a cruise with a Norwegian or a Mediterranean Shipping Company, our client, or Holland America, or Royal Caribbean, to go on a free cruise. And then obviously they get to play in the casino with that cruise experience, and there's a revenue share associated with it.
The emerging segment, however, and the reason that they're speaking to us is because of Gen Z. Gen Z are under the age of 27. They either are 18, or 21, to be able to gamble, depending upon the state that they're in. And they are the digital generation. And so for them, they may just want to go and play off of their phone off of their PC and never set foot in a casino. So the Gen Z audience loves iGaming, they love to play on their own pace, they like to go and play against other players. So, we need to understand what their interests are. Clients ask us, 'help us with research, help us with studies, help us to understand at a personal level, what their likes and dislikes are. What sports do they enjoy? When they're not, you know, enjoying iGaming or going into a physical casino, what do they enjoy most? Do they like reading? Do they like going on hiking trips? Do they like to run?' Finding out where their other interests are, and then meeting them where they are enjoying life is very, very, very important. So it's not a customer journey in the sense of their behavior in playing blackjack, or craps or roulette or otherwise, it's understanding what's going on in their own personal lives and where their enjoyment comes from and make a personal connection. And that is what the gaming companies are trying to accomplish.
(7:22) Following on from that we need to then factor in the whole personalization of rewards and ensure that it's not a one size fits all reward store that you're suddenly offering people?
It is, and so there's this dull, boring thing that a lot of casino companies do, where they say sign up for our program, easy enough. Give your personal information, get a card, download it onto your phone, identify yourself and then ultimately the casino can rate you, as an example. Go over to a kiosk, spin and win and we'll give you a free play. The same aspect has been done for many years now.
The problem is that doesn't create any kind of an emotional connection. Why wouldn't I sign up for the chance of getting $100 in free play playing slots. You need to encourage that individual that signs up to have preference for your brand over someone else. And if you treat everybody equally, especially those early entrants to your property, you're not going to create the emotional connection that you need. You need to immediately engage with them and find out if they enjoyed their experience at your Casino? Did they enjoy their experience using your mobile app? What areas are they also looking for that they would like from an entertainment standpoint? Do surveys, any kind of outbound research that you could ultimately do? You have to understand how satisfied they are with the ultimate user experience? Are you not engaging them optimally? Are there problems with the mobile app in the way that they're accessing it that are causing them not to enjoy it as much as you would like them to?
You need that feedback loop., so that you can listen, learn and refine. And I guarantee you, there are a lot of inactives on databases, at casinos, and at online properties like a DraftKings or FanDuel or otherwise. They sign up, they experience it, they get $5 of free play for going and putting x amount of dollars in an account to ultimately look like they're truly serious. And then they spend that, they've got their free play, tried it out, told their friends that they tried it out, but they're not scientific in what they're doing in the way so many professional players are and they stop playing. So that drain on that discount is significant to the company's bottom line. And you need to optimize that investment. And that's where loyalty comes in, in segmenting out the customer, learning about the player, and ultimately achieving a better personalized connection with the player as well.
(10:23) Brilliant. That all makes perfect sense to me, David, but are there challenges in implementing these ideas and kind of what are the constraints that needs to be overcome in order to bring them to market?
Casino companies have been some of the smartest direct marketing companies period. They've been the smartest as far as running in-depth analytics to understand their player. That hasn't been a problem. So understanding the data, understanding where their preferences are, that hasn't been a problem. The fact is, going and applying it at an individual level, delivering on that personalization, that's where the biggest challenge is.
You need to have content, you need to have experiences that are unique and matched up, you need to have partners that offer incremental value to the player. So whether that's the cruise company that I just mentioned, or an airline company, or a hotel company, do things that go beyond what's in your house. That's one of the aspects because people live their lives and they go and spend and they behave with lots of different companies. That extension of the value proposition that goes beyond free play, that goes beyond the free hotel stay, that goes beyond the complimentary 18 holes of golf, that goes beyond the free meal, right? Those aspects that are in a more personalized level, that's curated, even with people who are at the entry level of behaving with you, is so important because then you build up a relationship, and then they become preferred to you as a brand for a lifetime.
(12:15) Given everything there, what one or two or even three things should the gaming and casino operators be doing to change the change their loyalty program to change the face of their customer retention, and that development of customer lifetime value?
Well, we have a methodology, if I may, where we do an audit, or a secret shopper of the competition, because we want to know what they're doing top to bottom. We examine the relationship that the competition has with the top player, the mid-tier player and the lower-tier player based upon THEO. We want to know what the competition is giving to the same player that we have in that same area of the country. By examining what the competition is doing and 'out-quicking' the competition and evolving what it is that you're doing, can give you a significant advantage. So that's one.
Two, partners. So that extension of partners over and beyond what you're currently doing, by listening to your players, asking them questions, doing surveys, and finding out where their additional interests are, gives you a refreshed status for your loyalty program by acquiring new strategic partners that you can work with over time, as well as tactical partners that provide new news.
And then the third thing, which I'm kind of excited about, and that's the reason why we're INLEAGUE partners with Loylogic, is events, experiences, gifts, incremental benefits, offering the opportunity for the player to be able to use their currency to treat themselves to a cappuccino machine, to treat themselves to tickets to go to particular events with their favorite sports team, to treat themselves for merchandise, apparel, watches, an iPhone, any of those particular things. Because that currency is sitting there, and what are they doing with it, they're just turning it back into free play. If they wind up going and treating themselves to a gift, or they get the gift and then they can re-gift it to a member of their family or friends. Fun. And that makes it very, very compelling for the player to continue to go and participate because they're getting incremental value from the casino gaming company.
(14:44) So, you've made all these changes. How do you measure the impact and success?
Market share, their feedback to tell us that, you know, you're highly satisfied with us. You are coming to us more often, we can see that based upon identification at the table and gaming and so on. Referral is another aspect, where you encourage your friends to go and join the rewards program from, you know, MGM, Caesars, Hard Rock, etc. The major companies are doing things to go and encourage players to go and participate in a more incremental level by going and doing outreach. And they're really smart at it. Those are the things that from a measurement standpoint.
You've got sophisticated financial models. What you need to do is you need to dig down further and then understand satisfaction, understand referral, understand, you know, personal feedback, so that you can ultimately refine what you're doing. And you'll be able to see that there's incremental lift, because you're getting a higher share from that player as a result versus year over year.
The other part is a change in that inactive rate. As I mentioned, people just sign up, get the, you know, the free spin, do it gamified. And then they and then they don't come back. If they're coming back, and you're still seeing them on an ongoing basis, you've done something better and different because of the experiential rewards and benefits and gifts that you're giving them that are distinctive.
(16:22) To wrap up the conversation, given G2E takes place next week, what one message would you take to that event?
Well, it's amazing to see the outline of all the different talks and all the different key themes that everybody is addressing there. Whether it's governmental challenges, whether it's aspects relative to Indian gaming and the expansion, which is very exciting. One of our clients is Wondr Nation, which is part of the Mashantucket Pequot Tribal Nation in Connecticut. There's going to be a talk about loyalty specifically, and our client, Janine Ramsey, is going to be on the DS for that.
But one key takeaway is just to continue to innovate. Talk to us, because we understand consumer behavior, as many gaming companies do. There's no doubt about it. As I said, they're best practitioners. But in terms of loyalty, best practices and implementation, just like Loylogic is a fabulous partner in all the services that they provide in terms of experiences and engagement and rewards, we are very good at providing a structure and an approach to refresh their loyalty program, and set it up for that next generation.
Gen Z is going to be a driver, because of them adopting all of these digital engagements and their iGaming behavior. And you need to go and transform your program to meet the needs of that new segment of customers that are coming into the market. That's a completely different mindset, in terms of how they want to be spoken to at a personalized level. They are expecting immediate turnaround in recognizing what their behavior is. And they're looking for reinforcement that you show me that you know me, it's very, very important. There's a huge gap between the older player and the very young player, and you need to start evaluating what you can do for that younger Gen Z player.
