|
Press Releases & Articles
November 2007
Casino Chief Financial Officers Can Reduce Costs, Forecast Revenues
By Helping Their Property Focus On Guest and Employee Advocacy
by Martin R. Baird
(Print,
PDF)
Chief financial officers at casinos are under pressure to accomplish
many things, two of them being cost reduction and accurate
forecasting of their property’s performance. They can accomplish
these goals by working with various departments to eliminate guest
and employee satisfaction surveys at their casino and replace them
with an index that measures advocacy.
There is some wonderful research out there about customer
satisfaction. As a gaming guest service consultant, I work hard to
stay abreast of what’s happening in this area in all industries, not
just gaming. So imagine my shock when I read research published in
Harvard Business Review that shows that there is zero correlation
between customer satisfaction and future growth. In gaming, that
means there is absolutely no correlation between guest satisfaction
and the future growth of your casino.
This is unbelievable! How in the world can this be?
The answer is that satisfaction is a very fickle measurement tool.
For example, a guest could be “satisfied” today because they had a
good parking spot or you had shrimp on the buffet and they love
shrimp. But if that same guest returns to play again tomorrow and
has to park at the far end of the lot and shivers at the sight of
liver on the buffet, they probably would be “dissatisfied.” So is
that guest satisfied or dissatisfied and how does that figure into
the future of your casino?
Such is the cold, hard reality of guest satisfaction. By the way,
the same is also true for employee satisfaction. Casino employees
are as fickle as the average guest, if not more so.
In your next executive team meeting, ask two questions. First, ask
for your current guest satisfaction score. Someone will give you a
percentage of the guests that are either extremely satisfied or
satisfied and the person sharing that information will be very proud
of the numbers. Then ask, “What is the correlation between that and
future growth?” If you get an answer, listen closely because it’s
going to be a good one, if you know what I mean. When they finish,
ask to see the data that supports the answer.
My guess is they will not quote the research in Harvard Business
Review. They will say nothing about zero correlation between
satisfaction and growth.
Next, you need to know if guest and employee satisfaction surveys
are a waste of your casino’s hard-earned money. I know the answer to
that one. What you really need is your casino’s guest and employee
Advocate Index™ score.
What is an Advocate Index? The answer is that it’s a simple way of
measuring how many guest and employee advocates your casino has and
expressing the outcome as an index. The index can be used to predict
your casino’s future growth. I know this may sound too good to be
true, but this has been studied for 10 years and researchers have
found that it works. Methodology similar to Advocate Index is being
used by leading companies in many business categories.
For example, the president and chief executive officer and the chief
financial officer of Intuit (as in QuickBooks, Quicken and Turbo
Tax) quote their version of the Advocate Index score when they talk
with financial media. They are telling the world that this is the
number they track to predict the company’s future.
How can this work for a casino? Guest advocates play again and again
at their favorite casino (repeat business) and recommend that casino
to friends and relatives (new business). If those friends and
relatives also become advocates, they are the source for even more
repeat and new business. Employee advocates say good things about
their casino in the community, possibly encouraging people to play
there. Thus, the more guest and employee advocates a casino has, the
better. The more advocates a casino has, the higher the Advocate
Index goes. And because of the correlation between advocacy and
future business performance, the index can be used to forecast
future growth.
|
