Where is the Money? Part 9 of 36: Social Media Meets Player Development (Mixing Personal and Business Relationships)

Authors’ Note: As we established in parts 7 and 8 of this series, social media is now a powerful force in the casino industry. And guess what? Good hosts exploit it. Social media is like an invisible force in the management of relationships with customers. Players and hosts can and do send messages, share personal stories and communicate on a very personal level via social media. This remarkable social channel is completely outside of the control of the casino, and because the relationship is personal, exactly who owns the relationship is questionable. In this article, we dig into these ownership questions and suggest ways that the casino can maintain ownership of the patron while the host is connected on Facebook. Before we dig into the player development side of social media in this article, we’ll set the stage with some critical concepts. These concepts define the difference between business and personal relationships and allow us to build out a way of understanding the quite different world we find ourselves in with the advent of social media.

In Mandarin Chinese, guanxi is a generic term for a personal network of influence. In Chinese society, this is a very important concept, and understanding how it works is a central part of how a Westerner can learn how to do business successfully in China. The direct translation to English—“connections” or “relationships”—does not properly convey the depth of the importance and influence of the type of relationship guanxi describes.1

“Successful long-term business relationships in China are indeed anchored by strong personal bonds. China does not draw a hard line between business and personal relationships in the way that many Western societies do,” Roy Chau said in his Sloan Review article on building relationships in China.2 Quite simply, it seems that in China, the depth of one’s relationship on a personal level is critical to long-term relationships, trust and doing business. This very different cultural environment has sparked major shifts in behaviors by Westerners trying to do business in China—and endless books on how to build your guanxi.

As Chau implies, it has long been thought that these deep personal relationship are not a major part of business in the West. In other words, it is quite normal for two organizations to do business with each other without forming a deep personal relationship.

Consider this example: Company Alpha is evaluating Company Beta for a Business-to-Business (B2B) relationship on a technology platform. Alpha is going to look at Beta’s financials, understand its market position, examine its culture and of course, evaluate the technology. The personal networks involved will be relevant, but it is reasonable to expect Alpha to see those as secondary to the B2B relationship.

Furthermore, we can expect that the relationships that are built during the business dealings between the companies will be considered business relationships, not personal relationships.

In the West, personal relationships are between family members and friends. In a personal relationship, we discuss matters of the heart and of family, and we share intimate details of our lives. Sometimes the lines between business and personal can become a little blurred at social events and business dinners, but at the end of the day, business people in Western countries usually keep their business and personal relationships quite separate.

But enter Facebook, and all of this changes. With a simple click to accept a friend, we are now able to share what are often quite personal details of our lives with our business partners.

When Business Gets Personal
There is little doubt that every business that involves people needs to think about how social media is impacting their business. As described in our February 2015 article for this series, the social media numbers are staggering. Almost two-thirds of all Americans login to Facebook every day. This unstoppable force is changing the fabric of society and is altering how we live, work and play. Those in denial of this growth need to take a deep breath and look at the numbers again: Two-thirds of 320 million Americans login to Facebook every day, as estimated in 2015.3 Those two-thirds are often using Facebook as their window into the world. What is even more remarkable is that the social forces at play are invisible to those outside the network.

In the world of player development, hosts are Business-to-Consumer (B2C) sales people, and they are constantly building their network of players. Historically, the industry has been littered with examples of high-value hosts having “black books” of high-value players that they have cultivated over the years; some even have their own websites.4 Today, the network is built online.

Modern hosts use social media to cultivate their players, and this can be a challenge for casino operators. Consider the example of socially enabled players (CEM February 2015). These players see Facebook as one of their primary means of communication. Modern hosts are very active on Facebook, and one of their primary means of communication with their players is over this social platform. This strangely brings us much closer to a Chinese model of business, where guanxi and deep, committed personal relationships are key elements of business.

The greater challenge is that the relationship between the player and the host has gone far beyond a secret black book; it is now a complete mystery to the operator. The modern host is part of the player’s personal life, and it requires a different kind of thinking to imagine how the operator can be involved in this personal relationship. It starts with choosing the right hosts in the first place.

Employment of Hosts
When employing hosts in the socially enabled world, their personal influence is now very important. While operators may find this invasive, there is little doubt that a player development expert turning up with a large, active social media presence connected with many players is somebody of potential value.

To consider how this personal relationship effects player development, let’s consider two attributes of a host:
• The size of the host’s personal database.
• The host’s personal activity on social media.

Table 1 highlights how these attributes affect job performance.

In this new world, it will be challenging for operators to measure what type of host a prospective employee will be, so in addition to probing the prospect with questions pertaining to the depth of their experience and the size of their existing pool of gaming contacts, the operator must now devise methods of determining the level of social engagement the host has with his or her gaming contacts.

Ownership of the Relationship
The work decisions do not end there, however. Once the right hosts are in place, the casino still cannot take a passive role. If we think about ownership as a bundle of sticks,5 before social media it was possible for an operator to own the player relationship. If a host left the property, that host’s players could be reassigned to other hosts and the relationship with the player could continue. But in the world of social media and the modern host, there are some real and ongoing challenges to face.

Let’s consider the example of a host named Chris who moves from Casino Alpha to a competing casino. In the past, the operator would strive to not allow the host to bring her “black book” of players. In fact, in switching casinos, the host would in many ways be starting over. For Chris, who is a modern host, the situation is quite different. She makes a Facebook post announcing her new role and starts directly communicating with her Facebook friends. Leaving aside the legal considerations, it is very difficult for Casino Alpha to stop this communication. Worse yet, the players feel like it is business as usual, as they have been communicating with Chris on social media for years. Chris might even have a private party and invite her old players to the new property to experience a special event accompanied by a special signup offer.

For an operator this could be a very scary scenario, and clearly we need some strategies for how to handle an event like this. Let’s consider some options: (1) organizational social media, (2) executive social media and (3) multi-connect.

Organizational Social Media: The organization can embrace social media and create a buzz, showing a constant stream of activities that are socially relevant. Given the enormous number of patrons that are constantly connected to social media, these activities need to be in real time, and they need to be interesting. This goes far beyond the announcement of events. Messages must create a personal relationship between the operator and its socially connected players. One way to cultivate this is for the operator-produced material to be entertaining and funny—it should be something that the players will want to see. This is a far cry from the passive informational websites of the last few decades. Today, it must be very active and entertaining material. We can take this to another level by creating social media resources and requiring players to interact with this social media. The SEO strategy of the organization is critical here, as players must connect with the organization and see value in belonging to its social network. If operators accomplish this, then the property joins in on the trusted personal relationship between players and hosts.
Executive Social Media: The executives above the host can connect directly to the players, too. This multilevel connection is challenging to manage but provides multiple levels of value. A first level of value is that now communication between the player and the host is visible to management and manageable by the executive directly above the host. A second level of value is that if the host leaves the property, like in the example of Chris, the executive can reach out directly and communicate with the players. A third level of value is that the executive now has information streams about the players and their interaction with other properties.
Multi-connect: In this option, no player should be able to connect with just one host, and multiple hosts are encouraged to engage with each player. Through this multi-connect model, we hope to make the players feel that they are engaged with the casino’s community, not just one individual host.

Socially Enabled Tools
As we have often discussed, the importance of data and information-based decisions is more important than ever here. We have identified key components to a player development tool as described in detail in our February 2015 article, including the need for real time data and mobile tools. Socially enabled tools take this a step further, promoting and even tracking the social interactions between player and host.

The more aligned that a player development tool is with the goals (and financial incentives tied to them) of a casino host, the better this tool can track and monitor every interaction of a host with his or her players. As a simple example, a player-tracking tool that allows a host to trigger a contact (phone call, email, text, etc.) with a player can be used as a measurement of such interactions. If the casino then ties the host’s goals with these forms of communications, the hosts will invariably move all of their communications through the tool, as opposed to handling them outside the tool and tracking them via their own personal “black book.”

Extending this to social media then provides the same leverage of the casino to participate, track and reward hosts based on their social engagement with customers—in other words, their social guanxi.

Bringing it All Together
The sea change of social media over the past few years brings a form of guanxi to player development, and, like all massive changes, it brings opportunity and risk. The critical observation is that there seems to be risk in avoiding this trend—and that our hosts are probably already actively using social tools to establish their personal relationships with the operator’s customers. The only practical way to gain visibility of this invisible force is for operators to join social networks and build their own guanxi.

Footnotes
1 http://en.wikipedia.org/wiki/Guanxi
2 http://sloanreview.mit.edu/article/building-effective-business-relations…
3 http://en.wikipedia.org/wiki/Demographics_of_the_United_States
4 http://topcasinohost.com, referenced Feb. 2015.
5 CEM April 2014, Cardno Thomas. Ownership is a bundle of sticks.