After last Tuesday night’s presentation by the consulting team, I would say there were some good suggestions made with regard to possible upcoming projects for the future. The first thing to mention is the 62% return on investment that we have received on our current IT investments in our data warehouse and closed loop marketing. The next step for our company is to move into the digital age with an online reservation system. While there is no additional capital needed to implement this project, there is a monthly fee of roughly $25 plus $5 per room that is booked. This will take away from our room charges; however it will make it much more convenient for our customers. Also, if we find this to be successful bringing in more traffic to our hotels, we may be able to pass this charge along to customers in the future. There is no real investment to be made with this project, but something that will help to improve our customers’ experience.
Another investment for the future would be to spend roughly $50k on a new enterprise server to enhance our data analytics. A new server would provide for instant saneness checks on customers, as well as faster and customizable analytics. Our current system has served us well, but is quickly becoming outdated. An investment now to enhance this system will be beneficial.
The last suggestion made by our consulting team was to leverage our existing data warehouse and data mining expertise to try and market to those outside of the Total Rewards program. The upfront cost with this project is minimal at roughly $1,000 for a mailing list to 25,000 consumers. The marketing offer would be for $210 (a combination of chips and dining) per customer. Assuming 12,500 accept the offer (50% response rate) it would cost $2.6MM. Now on the benefit side, assuming 30% of those that respond are “quality” customers spending $1500 per year at Harrah’s, that brings in an additional $5.6MM in revenue for a profit of roughly $3MM. This project would also be maximizing our existing ROI as it is leveraging the data warehouse that is already in place.
It would be my suggestion to move forward with all three of these projects in order to enhance the capabilities that we already have and to try to gain more quality customers at each of our casinos.
Please feel free to reach out to me with any follow up questions that you may have. Thank you for the time to review this project with you.
Deidra
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