Rewarding Loyalty

By Reid Paul | September 01, 2006

Harrah's Entertainment has taken the gaming industry by storm. It's the world's largest provider of branded casino entertainment through operating subsidiaries, which include Caesars, Bally's, and Paris, among others. Now, the company's phenomenally successful Total Rewards Program is not only causing other casinos to sit up and take notice, but companies outside the gaming industry as well. With the program, Harrah's has been able to build powerful, lasting and loyal relationships with its guests across properties.

Hospitality Technology quizzed Tim Stanley, senior vice president of information technology and chief information officer at Harrah's Entertainment, to find out how the company is using its Total Rewards program and to get insights into plans for the future.

Hospitality Technology: You are relatively new to the gaming industry, how did you get involved at Harrah's Entertainment?

Tim Stanley: I have been associated with Harrah's in some capacity since 1998. The initial association was as CIO of National Airline, which Harrah's had invested in. Since then I continued to work with Harrah's and other gaming companies. I worked for one and a half years with Harrah's, specifically related to architecture, helping prep for business growth, online booking and the Total Rewards program, before I permanently joined the company. We did that with my consulting firm, called e-Total Rewards. Ultimately, they asked me to come on board and lead the development of IT and eventually take on the CIO role. I came on in 2001 and it has been a white-knuckle ride ever since.

HT: Do you think having that broader perspective of being a consultant has helped you at Harrah's?

TS: Hands down. The three things in my career that have influenced me the most are my experience in operations, IT and R&D (research and development). Having been in operations and thinking about the different ways to accomplish goals gives me a different perspective. My background in R&D also gives me a unique perspective because what we do here, to some degree, is innovate. I bring some of that knowledge about test and control and how to set up trials and evaluate alternatives. You have to think about product roadmaps and multiple initiatives and how they all tie together. When you blend all that together, it gives you a different spin on the role of being CIO.

HT: I would think R&D would be the key to doing something as complex and constantly changing as the Total Rewards Program. Everything you put in it and around it has to be developmental towards the next ten stages.

TS: Exactly. Also being a consultant. Often in the consulting world you are at one project and then off to the next project; but being in operations and having to run systems, knowing that things last for years, and people change and systems and processes are still there, can be good and bad. I catch myself unconsciously thinking something is too ugly, but sometimes you still have to push it out early and ugly until you figure out what doesn't work.

HT: Sometimes there is a fear of putting something out that may not work perfectly from the start. It is a different approach, but is it a strategic advantage for you to be able to get there knowing that some things need to be developed later?

TS: I do struggle with it. On the one hand, IT managers want systems running all the time and if they go down, it is okay in small doses. However, it angers the guests and has regulatory and financial implications. At the same time I am looking for more innovation, creativity and speed. How do you bring all of those elements together?

We are bigger and we are cranking this stuff out. We are doing up to 300 or more projects per year, whether it is a basic project or integrating 13 properties in nine months or less.

HT: When you first rolled out Total Rewards, was it really seen as the strategic initiative that it is now or was it more like 'this is something we should do but we don't know how useful it will be'?

TS: The answer is a little of both. It was sold to be strategic and that was a plan. Casinos back in the late 1980s began to develop slot clubs with a card, but much of that was at the local property level. I think the revolutionary idea was to say, customers in Atlantic City aren't really so different than those in Reno. Harrah's originally looked at creating a national program in the early 90s but the riverboat boom got in the way. In the mid 1990s we reengaged on this whole idea. With a bigger company and many more properties it was like the old adage: The number of nodes on the network is inversely proportional to the value of the network.

Total Rewards was predicated on the slot clubs. The idea was to pull the clubs into a central database and make it such that even a customer who had data in one system could be recognized at a different property. In 1997 we rolled out the basic program and by 2000 we had developed the tiered program. We then added such components as a campaign management system. The data management system actually analyzed that and then applied the analytics to it and figured out what to do next. That is when the juice started to flow - we had pretty good growth because it began to shift from just opening casino doors to being much more strategic about attracting customers.

The challenge now is how much can we get out to the properties and have it effectively executed without stepping all over each other.

HT: I think that becomes the key question. Now you have so much information you are collecting, but how can you act on it in a reasonable and timely manner to make it useful?

TS: There is tons of data captured. The challenge is making it actionable, discernable, and then turning it around in a more practical period of time, like when the customer is there instead of focusing on sending them pieces of direct mail for their next visit, which may be three days, three months, or years from now.

HT: Are all of the analytics done at the corporate level?

TS: Certain practices we put in place we call capabilities and that can be anything from a product or application we have created to business intelligence and analytics. At Harrah's, capabilities should be created, managed, administered, operated and dealt with at the corporate level, which gives us the scale and capacity to perform functions that a lot of our competitors haven't been able to or haven't wanted to do. We also factor in feedback about how the capabilities really have to work from property level employees. We create teams with people out of the business, corporate, IT, and marketing departments, and anyone else who might have useful input.

HT: Have you gotten any push from casino managers to get closer to real time for certain data or alerts? Is that something they would want, or do you see that as necessary in the future?

TS: Strategically, the objective is to get more real-time, personalized data out there. The value of real-time CRM is much more visceral at the property level than it is at the corporate level.

The properties feel it is great because they can know what is going on with a customer and can greet and interact with him or her. Strategically, the CRM came from the corporate level, but the demand and the sense of satisfaction in using it clearly comes from the properties.

HT: You are in the process of making your next five-year plan for the company. Is there anything you are willing to tease us with in terms of what we might expect to see on the horizon?

TS: Harrah's will be clearly continuing to use its forte, which is analytical CRM, and adding much more into that so it becomes an operational score card. It will be getting much more sophisticated. That is not what our guests can see but it is a big part of what we are doing here. More of this philosophy of not just customer-related issues but scheduling, who is doing what, what conventions are in town, weather, etc. How do you change and influence your business? The other thing you will begin to see is Harrah's bringing its brands to life. We will use our unique capabilities to gel that branding together and link all of this with the Total Rewards program nationally and internationally. I am debating whether I need to blow it up and start over to make it work in that regard. You will see it percolate into much more than just gaming transactions; it will also trickle down into retail, restaurants, etc.

We are also going to be develop new concepts that Harrah's is not necessarily known for. We have 333 plus acres in untapped space to develop. Our CEO Gary Loveman calls it a Disneyland-ish experience - how guests will navigate the area and stage their time. Almost all of it will have a huge technological component in future.

It is quite likely that the iPort idea we first presented for Singapore will reemerge in multiple markets around the country, with an encompassing experience close to a "Harrah's World" gaming theme park. You might come to Vegas but you will be consumed with us during your visit. Some of it will happen quite soon and other elements will happen in five or more years.

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