So a quantitative researcher and casino executives walk into a bar…

chalkboard numbers

 

The casino is MGM, one of Las Vegas’ giants. The researcher is Harikesh Nair, Associate Professor at Stanford.

The article neatly sums up some of the insights gained from the analytic work:

For example, if a customer visited MGM only once and spent little on the trip, the model looks at the long-run spending of others similar to that customer. If the others spent little on the first visit but dropped a bundle on subsequent trips, the system will target the customer in question even though he or she spent little the first time around.

Typically, a business that sees a low-spending customer (if data is collected in the first place) would probably neglect to place emphasis on them. But by examining the data on a more long-term (life-time?) perspective, it’s clear that something can be done to encourage further customer loyalty.

Casinos collect THAT much information from their patrons it’s beyond belief. Yet the challenge often lies in what to do with them. And if you think about it a little, isn’t that what’s facing many major organisations today? Vast data, enormous input, but they are not exploited, either due to poor data organisation or insufficient know-how?

The term ‘big data’ is bandied about these days enthusiastically by many analysts, without many firm definitions or framework. But this sentence sums it up as eloquently as anyone has:

“Good analytics, combined with great data, complements smart management. This is the real promise of the ‘Big Data’ revolution.”

(Photo: Flickr/WorldBank)

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