Stupid Online Poker Rooms - 03-06-06

March 6 - No I am not saying  they are all stupid. I am merely suggesting that under the surface of the glitzy promotions, fancy and often useless features and "make you rich in an instant" tournaments, some high profile poker rooms forget something rather important: how to keep a customer...

I have been playing a lot of online poker in the past six months. I guess I am a very lucky poker player. Unlike most people, I have a mentor who is helping me to make the experience of learning to play poker a profitable and rewarding one. We have been running the The Poker Experiment since late last year and I am quite happy with my progress. I play an average of about 8 hours of poker per week, and I think that qualifies me to make observations about the poker rooms I frequent.

As a dual stakeholder in this industry, both as marketer and player, it is sometimes quite astounding to see how competitive an industry this really is. In corporate speak, the suits will tell us that they still see lots of growth for poker. Be that as it may, but on the ground things are fiercely competitive. Poker rooms have very clever marketing people who try every trick in the book, and out of the book, to lure us into their poker rooms. They spend an awful lot of money doing this, and I question in most instances how sustainable these promotions are.

But having played at about 10 poker rooms, and very actively at about three of them, there is a great big hole that seems consistent across the board: how to retain players. I'll give you an example from personal experience (I am not going to mention any names for now).

At Poker Room A, I played actively for about two months. It was early on in my poker career, so like any novice I was losing money. This didn't bother me. I deposited three times, $50 in each case. They experienced some software problems. I complained that it affected a tournament I was leading (which they denied but that's beside the point). After wasting time and getting annoyed, I cashed out and left. I have not heard from them since. Nothing. Not a word. Now a very similar thing happened a while ago with a niche online bookstore where I  have bought three books before. They screwed up an order (I got the wrong books). After a few emails the problem was fixed and I received my book. By this time I had decided that I wasn't going to buy books from them again. About six weeks later I got a personalized email, apologizing again about the screw-up, and offering me a 10% discount voucher on my next purchase. Guess what? I bought another book!

Now I am not suggesting that poker rooms should hand out free vouchers. However, the said bookstore obviously flagged me as a pissed off customer in their system, and after a certain period had expired, it triggered something somewhere to drop me a mail (which was probably automated). I came back.

The moral of the story is that poker rooms are obsessed with acquisition, and very few do anything other than blanket promotions and tournaments to acquire and retain customers. Poker players can be categorized into segments by spend, frequency, game types and a host of other factors. Pissed off players can be flagged, their past patterns can be assessed, and they can be invited back in with the smallest of sweeteners.

Players who have left can be won back. Having left about 5 poker rooms now, not ONE has made any concerted effort to get me back. Grant it, I am small fry, but there are thousands like me and all those small fries add up to a huge gourmet meal. Of that I have no doubt.

I am probably going to be more critical than most. For many years I wore a suit and spent my days as a consultant, telling people how to understand patterns in customer behavior to help them service them better, keep them, and ultimately make more money from them.

But the observations I make here to me are just common sense and don't need a dude in a suit who charges way too many $$$'s per hour.

As far as I am concerned, the online poker market is overcrowded, way overcrowded. My jaw hits the floor when I see new poker rooms making an entry into the market. I would love to hear a recording of the story that was sold to their investors.

In my opinion, the poker rooms that are going to survive, and those that are going to lead the pack are the ones that understand their customers, identify patterns in their behavior, and put systems in place to act decisively. These rooms will keep customers, even disgruntled ones. They will also make those same customers spend more money with them.

At the moment, the best marketers are winning the day. I'd put money on that changing in the next couple of years.

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