Group-6: Saumya Srusti Peeyush

Sumit Abhishek
Agenda of the case
Introduction
Company’s Overview
Company’s Overview

40 , 000 hotel
4 million sq feet of rooms 100000
casino space employees

40 million total
Company’s Overview
Ø World ’ s largest provider of branded casino entertainment
Ø Owns , operates and manages 50 casinos under brand such as :-
ü Belly ’ s
ü Caesar ’ s
ü Harrah ’ s
ü Horseshoe
ü Rio
Ø Main operations are :-
ü Casino
ü Hotels
ü Dockside
ü Riverboat casinos
Ø Competitors are ( MGM Mirage , Boyd gaming corporation , Las
Vegas Sands Corporation )




 Need for CRM
Ø Started rivalry, instead of opening lavish
properties, Harrah initiated CRM.
Ø Understand and appreciate the importance of
customer focus and relationship building in a
successful CRM program.

• Examine the importance of capturing and

using customer information in a CRM initiative.

• Study and analyze the role played by loyalty

programs in developing and nurturing customer
relationships.

• Understand the role played by IT in a CRM

The further we get ahead and the


more test we run, the more we learn.

The more we understand our
customers, the more substantial the
switching cost that we put in place
and the farther ahead we are of a
competitor’s efforts. That is why we
are running as fast as we can.


 -Gary Loveman, CEO, Harrah Inc.

 CRM
Initiatives
1) Customer Loyalty Program
Ø Total Gold program customers were
given electronic card.
Ø The customer information collected
using this card is stored in
central repository.
Ø This information also used to
reward customers.
Ø Some weaknesses in Total gold
program that are:-
-There was nothing different about

Harrah’s rewards as compared to

competitors.
-No consistency in rewards earned by

customers.
-Earned different rewards at different

properties.
) Customer Loyalty Program (cont.)

Ø Different approach i.e. tiered approach

where customers were divided into
tiers:
-Gold

-Platinum

-Diamond

-Another objective of Total reward


2 ) D e cisio n S cie n ce To o ls
Ø Harrah’s used COGNOS Impromptu. to
access data warehouse & run
predefined reports & execute queries.
Ø A tool SAS used by Harrah’s carrying out
market segmentation.
Ø Primary purpose was to Estimate
customers' worth over period of time.
Ø Determine Customer’s preferences.
Ø Predict the services and rewards for
customers.
 D e cisio n S cie n ce To o ls
ØClassification of customers done by
Harrah
3) Hotel Revenue Management System
3) Hotel Revenue Management System (diagram)
4 ) Pe rso n a lC o n ta ct M a n a g e m e n t

n 25% revenue came from just 5% of its

customer base.
n Harrah called this segment as ‘VIP
Customer’ and this customers
assigned personal hosts.
n A player contact system was
implemented to provide information
about customers to the host.
IT Role in Implementing
CRM
INet : Creating a Single Customer View

n Collect customer data from various

source systems,
n Integrate the data around the customer,
n Identify market segments and customer
profiles,
n create appealing offers for customers to
visit Harrah’s casinos, and make the
data available for operational and
other analytical purposes.
ustomer View of Total Gold Program
Closed Loop Marketing
Customer Relationship Cycle
Benefits
B e n e fits
 B e n e fits ( cont .)

qA doubling in the response rate of

offers to customers
 B e n e fits ( cont .)

n A brand identity for Harrah’s casinos

n An increase in customer retention worth
several million dollars
n A 72% increase in the number of
customers who play at more than one
n Harrah’s property, increasing
profitability by more than $50 million
n 62% internal rate of return on the
information technology investments.
n
Current Scenario

Operating Income
Current Scenario (cont.)

Revenue Breakdown
Current Scenario (cont.)

Revenue Breakdown
The Road
Ahead
R e ce n t D e ve lo p m e n ts

n 2008, Harrah’s entertainment was

bought by private equity firms
Apollo Management and Texas
Pacific Group
n Deal size $30.7 billion
n Including $12.4 billion debt and $1
billion transaction cost
n
E xp e cte d R isk Fa cto r
 C o n clu sio n

n The integration power of Information

Technology and CRM gives a better a
dominant competitive advantage to the
Harrah’s
n Gary W. Loveman refers to their success as "the
triumph of software over hardware in
gaming“
n An increase in retention of just 1 percent is
n worth $ 2 million in net profit annually. So far,
Harrah's is enjoying an increase in retention
of a couple of percentage points, thanks in
large part to its data warehouse.
Thank You