Friday, April 29, 2005

CRM and Loyality Cards

For my MBA we were posed with this question:

Many casinos like Harrah's use CRM strategies to aggressively target loyalty programs to the middle-aged and retirees with time (and presumably) the discretionary income to spend on gambling entertainment. By estimating a customer's propensity to gamble and comparing that with their past gambling behavior, Harrah's can target players with untapped gambling revenue potential.

Some argue that loyalty programs like these used by casinos could lead to an increase in the incidence of problem gamblers among these socio-demographic groups, and therefore, such marketing practices are unethical and should be regulated.

Answer the question, How can casinos get the maximum marketing benefit from their loyalty programs and lower the incidence of problem gamblers?

So what do I think?

The discussion is an interesting one. Let me preface this by saying, I tend to take a very liberal view on subjects such as these. In general, I believe people should be responsible for there own behavior. If I get a credit card application in the mail everyday and then apply for every single one and charge them to the limit - it is my fault. I did not have to get the credit cards, nor do I have to spend the money. With all that said, I don't believe it is the casino's responsibility to solve the problems of the gamblers with a disorder. Of course, should they be capitalizing on it? I don't think so.

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