Tuesday, October 27, 2009

Saving Face Online

CM Comment: Summary of how casinos are using social networking sites to connect with customers.

October 26, 2009: summarized from Las Vegas Sun -- Social media Web sites such as Facebook and Twitter are changing the face of customer relations at major Las Vegas hotels.

Resorts are setting up their own fan pages where executives can monitor customer suggestions on how to improve business, bask in guests’ kudos, offer immediate assistance to customers in distress — and cringe when unhappy patrons post critical remarks that ding their companies.

And for their part, customers are discovering that such Web sites are offering them an unprecedented voice, with their comments and reviews not only reaching casino managers but an untold number of other customers and potential customers over whom they can now wield influence.

Big brands — including casinos — that don’t develop social media programs do so at their peril, said Jennifer Van Grove, an associate editor at Mashable.com, an online publication that reports on the social media industry.

“The reality is, customers are going to talk about our brands with or without us,” said Harrah’s Entertainment Vice President of Marketing Monica Sullivan, a social-media expert who joined the company this year. “We want to be part of that dialogue. More customers are talking about the brands they love in social places on the Web rather than in e-mail.”

New technology isn’t necessarily an easy sell for the casino industry, an admittedly conservative business where managers have relied on decades-old marketing techniques, more recently borrowing ideas from other industries. Weighing against the opportunity to communicate with customers on a deeper, more personal level were many unknowns, such as the potential PR nightmare of exposing a company to unfiltered public comments that could deride the company as easily as praise it.

About two years ago, big casino companies including Harrah’s and MGM Mirage waded in with their first Facebook and Twitter sites — which have become increasingly sophisticated and which are now attracting thousands of followers.

The hotels use their Facebook and Twitter pages not just to promote themselves or drive business but to learn what people are saying about them, interact with customers and positively influence a broader audience of consumers. Given the explosive growth of social media sites, which don’t yet charge businesses or consumers, these might become more cost-effective than using traditional advertising and marketing methods.

To maintain credibility with customers, companies don’t tend to remove negative comments or constructive criticism on their sites unless the person posting the comment uses foul language or says something offensive to others. Though that may sound surprising for an industry known for being ultra-protective of its image, companies acknowledge that consumers want to be heard and may offer valuable feedback if given the chance.

Companies have quickly caught on to the fact that the good will earned from fixing a problem or improving a situation can have a ripple effect online.

MGM Mirage, for example, recently got kudos from fans for how it responded to a couple of complaints. After a customer posted on Facebook that he was unhappy with his meal at one of the company’s Strip resorts, the property’s concierge contacted the customer, who was still at the hotel, and offered to fix the problem. In another instance, a customer who had won show tickets complained online that he couldn’t use the tickets because he had a conflict. MGM Mirage gave the man free tickets for another date.

Station Casinos, which launched Facebook and Twitter pages this year, is recruiting people from across the company, from entertainment directors to race and sports experts, to post factoids and recommendations. When the sites are further along, customer feedback will begin to shape business decisions at the company, which traditionally caters to older gamblers but is reaching a younger audience through Facebook and Twitter, said Samar Hatem, corporate interactive marketing manager for Station Casinos.

“We’re just scratching the surface with this,” Station spokeswoman Lori Nelson said. “It’s like how Web sites started in the 1990s. The conversation we have today about social media is going to be completely different a year from now.”

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