Originally Posted by
mtacchi
One might wonder if the money directed toward Lacek in order to facilitate their participation in curbing 'gaming' might have been better directed encouraging the 'gamers' to spend more.
Probably not. I'm not entirely sure what promos were running that people were "gaming," so the following hypothesis could very well be wrong, but... it seems to me the gamers are those looking for the best/cheapest deal for them. Getting them to spend more would likely require a value proposition that the hotel wouldn't find favorable.
Let's make up a promo -- you've got people who are perennial platinums, but because of the economy, you give them a "stays count double" to retain their business. Is it effective to permit non-targetees to sign up for that promotion? Done right, you get business travelers back, who without their status next year, might shop the competition. Done wrong, and you're giving away status to people who would have paid more for it.
We can argue about it all we want on a message board, but to find the answer, *W hires a company like Lacek to answer that for them. The whole point behind market segmentation is extracting every penny possible from each group, knowing that different groups have different needs and will respond differently to different incentives.
'Vegas seems to understand that a market segment of the population WILL continue to SPEND with them if rewarded. Minimizing the reward outlay and employing a outsourced organization to apply the policy may appear successful on paper, as one cannot quantify the opportunity loss of the 'gamers' who would otherwise pay more for more.
Well, in Vegas, you spend first and then get rewarded. That's not wholly dis-similar to current loyalty programs that have some sort of "status" recognition. Oddly, the airlines/hotels diverge from Vegas in that the airlines/hotels generally use some metric other than money to award status. I could never figure that one out. One year when I made plat on NW, half of my travels were on VDB vouchers. Vegas isn't going to give you full RFB for playing $0.01 pulls in the penny slot machine for a week straight.
I used to work in the private jet industry, and over the years, I've come across those who worked or have worked in the departments dealing with the rich and famous. Some casinos WILL send the corporate jet for you, and it's astounding as to how much you have to actually spend in order for them to offer that. The smaller planes start at around $1M.