Getting a Gambling Business Back On Track
A major player in the gambling industry reviewed his operations and discovered a number of issues which needed to be addressed:
- Both the casino and bingo overhead costs were out of control
- It was unclear how to compare the profitability of different sites or what defines a successful site
- Marketing was perceived as inefficient
- Customer service was seen as nonexistent
The ProjectThe project was defined in terms of four work streams: Bingo operating model, casino operating model, Bingo footprint strategy and marketing management system.
Bingo Operating ModelThe workstream started by defining all customer touch points. The purpose was to understand where and how customers were interacting with the staff in the bingo club. It allowed for the definition of customer waiting time expectation i.e what the customer would find acceptable. Once these were defined, all remaining jobs within the club were also mapped out. This created a description of all activities taking place in a bingo club. Next a manpower requirement was created for each activity based on the club size, potential number of customers and customer expectations. The result was a generic operating model that when superimposed with the incoming customer volumes (by month, week day and hour) created a staffing model for the bingo club. Knowing the jobs and the staffing levels, allowed for cross-training and creation of a customer service enhancement programs based on skill improvement and behavioural change.
The second step in bingo workstream was to define how a club should be managed. This meant creating a management system including all meetings and new KPIs. As a part of the system, a top 30 checkpoints list was also created to aid managers in focusing on the vital aspects of the club operations. Results included improved customer satisfaction and decreased staffing levels (12%).
Casino Operating ModelSimilarly to the Bingo workstream there was no clear staffing model in the Casino operations. However, unlike the Bingo workstream, customer touch points were not a priority in the same way due to the nature of the business. Instead, a more specific control of the different gaming tables and pits was seen as the most important aspect of the operations. Therefore, the first activity map focused only on the gambling aspect of the business. As a part of the design, a review of gambling activities was made to understand how customers' game selection changes throughout the day. It enabled the development of a pit plan tailored to customer gaming habits.
A second map was then used to map out all the control and supervision operations whilst the third activity map took into account all the ancillary activities. As the model was developing, it became clear that a generic model, as in the case of the Bingo workstream was not the most appropriate solution. Therefore, a ten point adjustment scale was added to the model. It was based on the geo-demographics and affluence of the specific casino clientele. This meant that one site could have a skeleton ancillary crew whilst another site would require maximum staffing for the same number of customers. The workstream was finished with a development of a structured management system. The results included a 7% decrease of staff hours and an increase in intake motivated by greater seat availability when the customers were playing.
Bingo Footprint WorkstreamOne of the challenges for the business was comparing existing and developing new Bingo sites. Until the project, the only way sites were compared was on profit. This meant that a site of 150 seats was compared to a site with 600 seats and no one understood why they were not making the same amount of profit. The team in charge started by defining a site evaluation methodology and based it on revenue per seat with local income adjustment. The methodology was then used to evaluate all 110 existing sites. The results changed the perception of what, until now, was considered a good site. The new top 15 sites were then used as templates for further analysis.
The next step was to get a better understanding of the customers: their backgrounds, distance to the club, views and expectations. For this qualitative marketing research interviews were performed. They exposed what was to be perceived as "the right way" was not necessarily what the client wanted. Interestingly it also changed the perception that Bingo is, in today's society, looked upon as being an elderly person's game. As more and more information became available, the work on developing a footprint model began. It was taking into account the geo-demographic of the nearby population, the travel distance and ease of travel. In the end it defined a perfect club, from a surrounding population perspective. The model was then used to analyse the existing sites. The results showed that not even one of the 9 loss making sites would be making a profit. Two sites were closed within a month of the model outcomes and another 4 followed suit. As the company was getting rid of non profitable sites, a new acquisition process started. Here, the footprint model allowed performing both primary and final selections.
Marketing Management System DevelopmentOne of the main critiques of the current operations was lack of any marketing coordination between the head office and the 110 bingo clubs scattered across the country. The mission of the marketing workstream was to change that. The team started by mapping out current communication and planning process. This revealed that the communications were one way and with very short lead times (1 week) making it impossible for the sites to prepare. Moreover, it turned out that the sites themselves also had their own local marketing strategies. This was not coordinated with the head office.
The first change was therefore to develop 3 month rolling schedule visible by all. Secondly, a set of rules were put in place defining when communication was to take place between Marketing and Operations and the time frames of defining campaign dates. As these elements were being developed a more standardised approach to local marketing was also being defined. It focused on changing marketing department to one based on aiding the sites rather than one being disconnected and self contained. The result was an integrated marketing strategy across the country without any clashes between sites and the marketing department.
Project OutcomesThe project enabled the business to change into a more profitable and customer oriented company. There were challenges including halting the project half way through and restarting it 3 weeks later and redefining the roll out speed to a slower one. However, as one director put it, a year after the project finished, "the results were worth the pain".
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