Harrah's Marketing Strategy

Harrah's marketing strategy is different from many of its competitors because they don't invest large sums of capital in elaborate facilities, shopping malls or attractions. Instead, they focus on "knowing their customers well, giving them great service, and rewarding them, so that they remain loyal customers".

In order to execute the customer-centered marketing strategy, Harrah's developed the Total Rewards Program. This program is designed to attract and retain loyal customers by rewarding them with cash and comps for gaming and other activities, based on customers past transactions.

To facilitate this program, Harrah's utilizes a centralized data warehouse to collect and record a high volume of real-time customer transactions using a "total rewards card" (e.g. purchases, restaurant activities, gaming activity, etc.). Once stored, this data is then made available to Harrah's staff, who use the data to enhance the customer experience in the moment. The data is used to monitor customer behavior and define marketing objectives, evaluate the success of existing campaigns, and identify areas of opportunity and weakness. As a result, future marketing initiatives are redirected and lead to increase their success.

Harrah's Total Rewards loyalty card program and closed-loop marketing system has generated substantial returns in addition to creating: a brand identity, increased customer retention, increased number of customers who play at more than one Harrah's property, and an increased internal rate of return on its IT investments.

In the first three months of 2009, Harrah's posted operating losses of $127 Million (an improvement from 2008's 1st quarter posting of $270 Million). In addition, Harrah's doubled its debt load when it was taken private by Apollo Management and TPG Capital. These economic issues have left the company facing potential bankruptcy. The Total Rewards program could be used to increase demand through targeting marketing. Using the program to focus on its most valuable customers will help them to allocate resources to the most profitable areas and cut costs in unprofitable (or neutral) areas; thereby improving Harrah's bottom line.