The Evolution of Gifting

Gifting as a promotional reward brings players back by making them feel special

By Dave Bontempo

In the casino world, all that glitters is gold. Especially when it comes to gifting.

Psychological bells and whistles accent this significant industry realm in the age of hyper casino access. Technology bringing record gambling availability to patrons’ fingertips raises the stakes of customer retention. Gamblers literally hold a casino in the palm of their hand when wagering via their phones.

Casinos catering to that dynamic compete amid the abundance of information, and new offers. They need initiatives to rise above the level of loyalty points, small discounts and other gestures that quickly evaporate. Something has to last, to be held, and be valued enough to cut across the online and brick-and-mortar worlds. It must target a player’s sense of importance.

That gesture must say thank you in grand form, reflecting thought, pampering and the personal touch. Casinos that master this subtlety can walk the tightrope between customer appreciation and spend.

Operators can do nothing about competitors targeting their customers. But properties can invest in the emotional enrichment of their players. This pays dividends.

Imagination in Play

Patrick Papaccio, CEO of Imagine This, believes his company has a component to embrace and anticipate market conditions. Imagine This launched the first weekly Continuity Gift Program, accompanied by analysis to measure its performance, in 2004.

The program has accompanied the industry through several gifting eras, ranging from birthday, VIP, grand opening and anniversary offerings to the age of simply staying on a customer’s radar.

“Over the last decade, the power of the weekly Continuity Gift Program has continued to increase in popularity,” Papaccio says. “In the last four to five years, this program has gained momentum, and is now discussed on various conference panels.

“There are a variety of ways properties run this program,” he adds. “We estimate that over 90 percent of properties will be engaged in weekly gifting by 2030. Why? Instant gratification and tangible merchandise drive significant participation levels ranging from 15 percent to 30 percent nationally. These participation levels coupled with the incremental trips generated make what our clients say is their No. 1 promotion.”

Papaccio says it’s not a particular product, but a program and mindset provided by his company that help operators drive customer engagement. The program sparks incremental trips from any property’s best players, yielding higher revenue and profit, he asserts. He says high-perceived-value free-gift offers to qualified players motivate players to come to the property.

“We call it couch marketing,” he says. “Motivate the players to get off the couch and come in. Player cards are used to redeem and play in order to receive future offers. Data is obtained to measure many areas of the program to make decisions on how to improve results and manage expense.”

A wide variety of gift categories is used for these promotions, he indicates. Top performers include household goods like luggage, bedding, small appliances, jewelry, cookware, apparel, handbags, wellness, textiles like robes and blankets, and bakeware.

The industry has incorporated a nuance into gift deployment. It once appeared cut and dry: award patrons in tiers, providing the nicest gifts for those who spent the most, just as an airline rewards status for frequent flyers. But that’s been changing.

“Tiered gifts were popular 10 years ago, but the logistics involved plus being stuck with surplus make a tiered gift program more complicated,” he says. “Imagine This has measured tiered programs versus a high-perceivedvalue collectible set of goods, and the participation levels are surprisingly equivalent across all levels. The ease of a single gift per week makes the promotion logistics much easier.”

How that gift is used becomes important. Papaccio indicates that over 30 percent of the players who redeem gifts end up re-gifting them. That’s why non-logo products are the key to Continuity Gift items outperforming decorative and/or themed items.

The burgeoning online world has contributed its share of benefits and logistical quandaries. In the last two years, due to labor shortages, online gifting companies have sprung up to offer drop shipping of gifts, he says. And some drop the ball.

“You can imagine the calls,” he says. “Package didn’t arrive. Package was damaged. Package was delivered to the wrong or my old address. The other issue is that online drop ship gifting is offered by companies that don’t have actual inventory where they can manage and adjust quantities as needed.

They rely on third-party suppliers selling their products on Amazon and other drop ship sources.”

Because of this, the amount of available product in a certain style and cost category often shifts during the promotion due to lack of ample inventory from the sellers. That creates confusion and extra work for the property marketing and purchasing teams, he adds.

“These are the reasons we’re seeing many of these properties revert back to in-person redemption, where instant gratification has a greater response rate,” he says.

The Gift of Synkros

Jay Bertsch, senior vice president and chief commercial officer for Konami Gaming, says the company has evolved into a strong gifting position. Konami listened to what the industry wanted in this emerging realm and responded, he says.

“When Konami Gaming was in its early years, we heard a lot of casinos talk about the need for more data-driven, targeted, and configurable player rewards and incentives,” Bertsch indicates. “Casinos wanted to digitally deploy rewards campaigns through the patron tracking system, in ways that were appropriate to patron historical spend and relevant to their preferred activities.

“From this, Konami launched an industry-leading marketing tool kit through its Synkros casino management system. And for years since, casinos across the globe have used Synkros to send digital rewards, offers and incentives to players, directly through the system.”

Specific to rewards and incentives, Synkros has the practical convenience to transform awards from blanket promotions into a life cycle of personalized engagement based on direct input from patrons, according to Bertsch. Because offers are based on targeted player activity and preferences, operators can optimize awards to motivate key actions and behaviors.

“Whether the goal is increased visitation, share of wallet, carded play or market share, Synkros gives operators the tools to drive targeted player behaviors, while rewarding players in a life cycle of customer engagement with offers that the player actually wants based on preferences,” he adds.

Bertsch says rewards should be targeted, indicating a company’s knowledge of its customers. Gifting should be appropriate to the guests’ preferred activities and spend. “A patron who prefers table games probably isn’t going to get a sense of loyalty or reward from repeated awards and offers for bingo,” he asserts, “and a patron you regularly find in the high-limit room is probably going to want rewards that reflect a higher volume of spend.

“By leveraging the analytics in Synkros Advanced Incentives, operators have the data to deploy targeted awards and offers to targeted player demographics. This allows players to connect and engage with property promotions that are relevant to their carded activity.”

This has grown to include the online world. The Synkros casino management system offers a robust, real-time interface for operators to treat online players the same way they treat those who visit their land-based properties.

“This allows casinos with both land-based and online operations to create a single view of the player by accessing a single player loyalty account and payment processing cash wallet account, tracking play, managing loyalty point earnings and redemptions, and enabling targeted rewards and incentives,” he indicates.

“For example, through a robust integration layer, online players and casino players can link their loyalty accounts and cashless funding accounts to be used either online or at the casino. The operator can then track, analyze, and reward that player based upon their behavior and total spend. Rewards can be delivered via Synkros and can be redeemed online or in the land-based casino.”

Expanding the Gift Philosophy

Paul Gordon, senior vice president of sales for Rymax, says companies service a public with a growing appetite. The desire for players to be rewarded has grown as casinos expand to new states and within existing ones. Customers see more options, more competition and an increased sense of value they want operators to reward.

“The change that has happened over the past decade is that the player is more savvy about the quality of the gift and has higher brand awareness due to available information via social media,” Gordon says. “The days of off-brand and ‘tchotchke’ products are no longer desirable. Players are part of a community and want to be recognized for their loyalty and share their experience.

“That is why products are much more impactful than free play, as it delivers a trophy value and a residual impact. In its most basic example, if you received a nice watch as a gift from the casino, as long as you wear that watch you will associate the good feeling towards the casino.

“Get the same value in free play and the recipient will not only forget about it but in many cases will not have much to show for it. The era of player loyalty is growing, and our challenge as a marketing partner is to continue to provide products that are in demand and constantly update our product assortment.”

Gordon says Rymax is eclectic in its product portfolio and how it delivers its programs. The company’s web capabilities allow it to customize the site by client and provide them with analytics on redemptions and trends.

This arms Rymax clients with marketing insight that improves their bottom line from a budgeting standpoint.

“It also gives them a historical context for what drives redemptions and increases traffic and coin-in,” Gordon says. “Because we are in all different types of business verticals across the country, we have a consultative perspective on re- demption trends that helps our casino clients make decisions.”

Gordon indicates that thepsychology behind player loyalty gifts is to initiate trial and to increase frequency of play. This has become increasingly significant as the next frontier of gaming emerges via online betting.

“Today, the initiation of trial is primarily in the form of free play, which can easily be countered by the competition and does not build long-term loyalty,” he says. “Having a product gift component parallels the successful casino programs and creates differentiation by website.

“For all casino loyalty programs, we stress a strategy of segmentation and concentration. Do not have a ‘one size fits all’ approach, since the level of play and the demographic of the players necessitate the need for different rewards.”

Indeed, many sizes fit all. Gifts that resonate with players are primarily in three major categories, Gordon indicates:

• Fashion/jewelry

• Electronics

• Home cookware, tools, appliances

In today’s economy the player is interested more on their need than their desire, says Gordon.

“Money is tight and inflation is high, so people are driven by products that they need,” he says. “There also is an element of re-gifting, so we should not make decisions in a vacuum when we consider the product reward. Seasonality