The international market has been the life blood of Mayfair casinos for many years, but even before the Covid epidemic the decline in this elite gambling market was almost in free fall due in part to the enforcement of the Anti-Money Laundering regulations and the need to Know Your Customer (KYC) with many players not prepared to share their personal information. This proved that many casinos didn’t know who all their players were and was borne out by subsequent Gambling Commission audits and investigations which in turn lead to some hefty fines being imposed.
So, with this decreasing pool of players the competition between international marketing executives became more intense with more generous offers being made to players which included an increase in discount on losses, the offer of non-negotiable chips on arrival and higher Baccarat differentials. All of these initiatives increasing volatility and decreasing margins. All this was compounded by the fact that these players tend not to be loyal and while in town will visit several casinos based on their luck and the offers being made.
Now with the country coming out of lock down the Mayfair operators are waiting for the lifting of the travel restrictions, especially from the UAE, before re-opening their doors. However, with no guarantee that these players are actually queuing up to revisit London and the Mayfair casinos. Now it is not just AML and KYC, it is also now Safer Gaming and the new High Value Customer requirements that must be met. All good marketing executives know that reactivating behaviours after a long break is challenging at the best of times so recovery is not likely to happen in the short term.
Can the casinos servicing this market segment survive and if so, how? With most operators having made significant redundancies and cost savings they will be hoping they can. But a reliance solely on this market will be challenging and more than than ever it looks like a strategy of putting all your eggs in one basket! It is apparent that there will not be enough business to support all the casinos trying to service this market. Only the smartest will survive, and this means those with open minds, realistic strategies and comprehensive plans in place. The ones who truly understand their present and future target markets, and the overarching principle of remaining compliant. Of course the international market should not be ignored but it can no longer be relied upon to be the core business. It all comes back to the basics of supply and demand.
Customer service and recognition remains an important key to success and driving repeat business, for some casinos this will need a stronger focus than others as they have had several rounds of redundancies over the previous 15 months and in the process diluted their culture and dented employee loyalty – those not being made redundant have found their salaries being reduced, some substantially - and of course in some cases these headcount reductions may now prevent the opening of Tables to levels where the business can no longer operate effectively.
In scenarios like this not all of these businesses will survive due to their inability to review, revise and plan strategies that include new opportunities and then making a monetary investment in seizing these opportunities. While middle management can endeavour to have well trained competent employees together with a focus on customer service and competitive pricing, it is those businesses with the best and innovative marketing strategies that target and develop the market in their catchment areas that will have the best chance of success and survival. The old saying of “you can’t save yourself to greatness” has never been truer and senior executives that don’t realise this and that continue down the road of continually cutting experienced labour and reducing marketing expenditure will be those closing or selling their operations first. There are of course no simple answers and certainly having an experienced and motivated team is now more critical than ever. The landscape is changing and a year from now we will be applauding the survivors for their initiatives. The others will simply become case studies for future articles…