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Diamonds in the Data Mine
Class 4: IT & Customer Management
Author Gary Loveman
Case Summary by: Jakub P. Sram
Main Takeaways
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Use data mining to analyze information about customers to cultivate a lasting relationship
with the company
Don’t focus on how much people spend in Harrah’s casinos during a single visit, but
focus on their potential worth over time.
Harrah’s keeps its competitive advantage by using its human capital and technology
systems to get to know its customers better
More in-depth Summary
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Database strategy: combine data from all properties for customers to use their reward
cards at multiple locations
Determine who were the 26% of gamblers that generated 82% of Harrah’s revenue
Treat millions of customers differently depending on their value to Harrah’s
o Split customers into three tiers: Gold, Platinum and Diamond
 Best customers want service quickly—don’t want to wait in lines
Use data mining to improve customer service: customers want friendly, helpful attention
and fast service
Customers come to Harrah’s because of the service rather than the casino theme park
Harrah’s using database marketing and decision-science-based analytical tools to widen
the gap between them and other casino operators who base their customer incentives
more on intuition than evidence
Data mining suggests the most specific marketing strategy for Harrah’s value customers
o “our target customers often responded better to an offer of $60 of casino chips
than to a free room, two steak meals, and $30 worth of chips”
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