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David NortonChief Marketing OfficerHarrah’s Entertainment |
On Monday, May 17, the Chief Marketing Officer Institute will reveal the winners of its "CMO of the Year" award for leadership excellence. The following interview, conducted by the CMO Journal and CMO.com, is one of 10 with each of the finalists. Click here for our conversations with the other nine finalists.
>> Category
Large Organization
>> Company Description
Harrah's Entertainment, Inc. is the world's largest provider of branded casino entertainment. Since its beginning in Reno, Nevada, more than 70 years ago, Harrah's has grown through development of new properties, expansions, and acquisitions, and now operates casinos on four continents. The company's properties operate primarily under the Harrah's, Caesars, and Horseshoe brand names. Harrah's also owns the World Series of Poker and a majority interest in the London Clubs International family of casinos. Harrah's Entertainment is focused on building loyalty and value with its customers through a combination of great service, excellent products, unsurpassed distribution, operational excellence, and technology leadership.
>> Highlights
With the headwind of a global economic meltdown, Harrah’s Entertainment saw double-digit revenue declines in 2009. But diligent cost controls, prudent balance-sheet management, and innovative operational strategies enabled Harrah’s 51 worldwide resorts to remain profitable and outpace its competition in nearly every market. In early 2009, Harrah’s Chief Marketing Officer, David Norton, foresaw the impact the global recession would have on customer behavior–and knew the economic downturn necessitated a new approach. So he led Harrah’s Entertainment through a dramatic transformation, successfully turning the company into a personal-touch, sales-oriented organization. The shift to a direct-sales model helped Harrah’s deliver high-value experiences for guests, generate additional revenue from new business segments, and introduce an entirely new demographic to Harrah’s resorts.
>> The Conversation
Q: In 2009 you deliberately set out on parallel paths: cost containment and revenue enhancement. That seems like “mission impossible,” but you achieved that goal. What were the keys to your success?
A: The senior management team knew we had to get the cost of ineffective direct-marketing expense out of the system with the understanding that consumers were responding differently in the new world order. However, we had to be very surgical in our approach at a program and segment level. Our execution plan was the key to our success as we mandated control groups for all programs, centralized marketing analysis so that we would better understand which programs were driving incremental profitability, and enhanced management reporting so that nonconformers could be dealt with. At the same time, we had to stimulate new revenue through a couple of projects that we were willing to make a strategic bet on based on analytics and research. Effective implementation was critical here, too, in order to gain buy-in and quickly generate the returns we anticipated.
Q: During the year you led a diverse cross-functional task force in a holistic approach to evaluating the entire customer-experience life cycle and fundamentally addressing the need for enhanced customer intimacy. What was the greatest challenge you faced in leading that team and what did you do to address that challenge?
A: The area of the business we were addressing was nearly 40% of our revenue and had fueled a significant portion of the company’s growth in recent years, so the biggest challenge was convincing the organization that there was a need for change. Some felt that the economy was the sole reason for the revenue decline, but our analytics and research indicated that there were some things we needed to change or do better. Our diverse task force developed a deep set of recommendations in a matter of weeks, which we vetted quickly throughout the organization.
Q: One of the aspects of your nomination that impressed the judges is how you crafted your customer experience into personalized, real-time interaction with Harrah’s and your casino hosts. What lessons can you pass along to other CMOs who are striving to achieve similar relationships with their customers?
A: There are several critical elements to achieving real-time interactions between customers and employees. We need to have access to the data, which we capture through our loyalty program, Total Rewards. Working closely with our friends in IT, we are able to make the data accessible in near real-time and build tools that provide hosts with the information they need delivered to their mobile devices so they can offer personalized attention. It is critical to get the input and buy-in from the front-line hosts to expedite the adoption process.
Q: Though you have been with Harrah’s for more than 11 years, you’ve been in your current role less than three. What did you learn early in your tenure that prepared you for the challenges of the CMO role?
A: I had been responsible for the critical loyalty and CRM functions for many years, so I was well versed in the inner workings of the organization and had good relationships with the operators. The new things to focus on were an elevated leadership presence given how critical marketing is to the company’s success, and having to ensure that the talent on my team evolved given my expanded scope.
Q: Describe the relationship you have with your CEO and how he supports your team. What have you done to increase his support for your programs and strategies?
A: Many people ask me whether it is daunting to be the CMO for Gary [Loveman], who is so passionate, generally brilliant, and an expert in marketing. I would much rather be in my current situation than one where the CEO doesn’t fully understand the value or inner workings of marketing. While Harrah’s is recognized for being one of the best marketing companies in the world, Gary and I are both driven to be even better in the function since we know there are gaps in what is possible and how we are executing. This desire to evolve and drive innovation makes the job interesting and intense. As we develop new initiatives, getting Gary’s opinions helps ensure that the final product is as good as it can be and is adopted throughout the organization.
