Determine Internal Improvement ROI By Measuring Your Guest Advocacy

Casino managers pondering an internal improvement program to boost their property’s performance have struggled to determine the return on investment and now there is a way to calculate that kind of ROI.

For more than a decade, my company has been helping casinos improve their guest service and I’ve always hated the ROI question.  The chief financial officer always wants to know what the casino can expect to get in the way of a financial return on the money spent on improvement.  I’m pleased so say that there now is a way to answer that question.  ROI can be calculated by launching internal improvements that lead to the creation of guest advocates.

Here are some tips on guest advocacy and ROI.

Measure the Right Thing.  To determine ROI, casinos must stop measuring customer satisfaction and measure how many guest advocates they have.  There is good news from research published by Harvard University and further studied by the London School of Economics.  Researchers found that by tracking customer advocate levels, they could arrive at a very high correlation to the future growth of a business.  The higher the level of advocates, the more likely the business was to grow.

Advocacy Is Not the Same As Satisfaction.  Advocacy relates to a very specific and highly studied form of measurement.  If you hear the word advocate used as a generic term for guest satisfaction in gaming, understand that guest advocates and satisfied guests are not the same thing.  Advocacy and satisfaction are worlds apart.

Launch A System of Internal Improvement to Create More Advocates.  Advocates are created when casino employees behave in a certain manner and it takes a system of improvement to get them to display those behaviors.  It takes a system to move people from how they behave on the job now to how you want them to consistently behave.  All employees smile when the general manager walks by.  So how do casinos get them to repeat that simple, basic behavior with each guest?  Guests appreciate smiling employees and that is one behavior that can help turn them into advocates.

Help Employees Understand Why Improvement is Important.  Much of the resistance to improvement programs comes from team members who are not clear on why the improvement is being done.  At a casino that is already successful, it’s hard to get employees to understand that it’s all too easy to fall from the mountaintop.

Determine the Correlation Between Improvement and Future Growth.  The research published by Harvard found that in some industries, the correlation between the measurement of advocates and future growth was as high as 98 percent.  In gaming, I have found that it’s lower, but a mid-80 percent correlation from tracking advocacy is better than any other measurement tool available.

Advocacy has a high, measurable correlation to future growth.  And there you have it – an ROI based on proven, definable results.

Martin R. Baird
Robinson & Associates, Inc.