this is a case study for a 5 casino property gaming firm. This is a marketing response modeling project where insights gained enabled this firm to accelerate growth in the following year and improve their marketing ROI via a more optimized marketing spending plan.

1. Marketing Response and Optimization
Model for Alpha Casinos

2. What we will talk about today
• The model architecture
• Decomposition of marketing effects
• Total Alpha
• By Property
• By Week
• Marketing Variance Analysis and Drivers of Performance
• Total Alpha
• By Property
• Marketing Spending Optimization
• By Media
• By Property

3. What we will talk about today
• Special Issues and Topics
• Impact of Fuel Prices on Alpha Casino
• Promotion Effectiveness by Event
• Television Effectiveness
• Cable v. Broadcast
• Media message effectiveness
• TV & Radio media message optimization
• In-State v. Out-of-Area media optimization
• Marketing Synergies
• Marketing Investment Matrix
• Appendix: Model fit and validations

4. Model Architecture: Covers all marketing drivers plus
hotel rates and region fuel prices
Revenue
Gas.Prices
Print Media
OOH Media
Hotel Rates
Loyalty Cards
Promotion
Direct Mktg
TV MediaCable and Broadcast GRPs
Newspaper & Magazine Spend
Direct mail circulation &
Optimization
New issues
Nine Events
Outdoor spend
Region avg. fuel prices
Average weekly cash room rate
price
By Week
&
Property
Paid Search, Display Ads &
Optimization
Online Media

5. Total Alpha Casinos: Decomposition of Annual
Revenues. Direct is Dominant and Accounts for
about 38% of Total Marketing Impact
52.1%
18.4%
3.2%
2.3%
4.6%
1.4%
7.4%
6.1%
4.4%
47.9%
Base
Direct
Promo
Loyalty
ONLINE
OOH Media
Print Media
TV
Radio

6. Revenue Decomposition by Property: Significant
Differences in Drivers
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
Property 1 Property 2 Property 3 Property 4 Property 5
Radio
TV
Print Media
OOH Media
ONLINE
Loyalty
Promo
Direct
Base
Properties 2 and 3 more driven by media, while Property 1 and 4 & 5 more affected
by Direct Marketing.

7. Decomposition of Alpha’s Revenues by Week:
TV and Radio went Dark in Q1-08.
-20,000,000
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
Hotel.Rates
Gas.Prices
Radio
TV
Print Media
OOH Media
ONLINE
Loyalty
Promo
Direct
Base
In Q1-08, TV, Radio and Print
went dark or nearly dark
There was a significant reduction in TV, radio and print in Q1 and this impacted overall
performance.
Weekly Revenue

8. Q1-08 v. YA Marketing Variance Drivers: Lack of TV, Radio and Print
media in Q1 were major negatives driving -3.9% YOY Trend
-10.5%
-6.7%
-5.3%
-3.5%
-2.1%
-1.1%
1.3%
1.3%
4.6%
5.8%
12.3%
-100,000,000 -80,000,000 -60,000,000 -40,000,000 -20,000,000 0 20,000,000 40,000,000 60,000,000 80,000,000 100,000,000
Marketing Variance
Direct
Promo
ONLINE
Loyalty
OOH Media
Gas.Prices
Hotel.Rates
Base
Radio
TV
Print Media
Direct and promotions were strong positive drivers, but the cumulative -23.5% impact from
TV, radio and print, drove the negative YOY performance
Weekly Revenue

9. Marketing Variance by Property: Property 2 holding its own, but
Property 4 a major weakness, accounting for 75% of the -3.9% YOY
decline.
1.1%
-3.0%
-1.1%
+1.4%
-0.21%
-15.0% -10.0% -5.0% 0.0% 5.0% 10.0%
Property 1
Property 2
Property 3
Property 4
Property 5
Base
Direct
Promo
Loyalty
ONLINE
OOH Media
Print Media
TV
Radio
Gas Prices
Hotel.Rates
% Impact on HAC Total YOY Trend
Q1-08

10. Incremental Revenue per $1K Spending: Print Magazines and
Gaming, Entertainment media messages are the most productive
media tactics
$34
$41
$56
$111
$197
$256
$256
$257
$350
$968
$1,223
$1,588
$2,258
$0 $500 $1,000 $1,500 $2,000 $2,500
Incr.Rev.
Per $1K
Print Mag
Radio Promotion/Gaming Message
Radio Entertainment Message
Radio
Online Paid Search
Cable TV
Radio/TV Brand Message
Promotion
Print News
Broadcast TV
Online Display Ads
Direct
OOH Media

11. Marketing Optimization by Media Channel: Shifting spending away
from Direct Marketing and more towards Mass Media & Promotion is
expected to lift total revenues +11%.
Marketing Contribution Current Spend Optimal Spend
Print $197,919,585 $3,137,056 $4,730,312
Radio $119,205,549 $622,139 $3,430,736
TV $163,044,982 $5,990,834 $12,351,200
OOH $38,833,486 $5,084,962 $2,140,374
Online $124,430,739 $3,179,562 $6,637,395
PROMO $86,299,932 $1,941,516 $7,392,062
Direct $495,243,704 $83,630,050 $66,904,040
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Print
Radio
TV
OOH
Online
PROMO
Direct
$103,586,119 $103,586,119

12. Marketing Contribution Current Spend Optimal Spend
Property 5 $574,305,007 $33,533,049 $13,533,016
Property 4 $494,747,607 $23,193,519 $33,243,438
Property 3 $356,899,222 $19,877,122 $22,877,122
Property 2 $479,397,249 $22,641,594 $35,169,912
Property 1 $323,852,448 $24,217,958 $18,639,753
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Property 5
Property 4
Property 3
Property 2
Property 1
Total Marketing Spending Optimization by Property: Calls for shifting
funds from properties 1 and 5 towards properties 2,3 and 4

13. Special Issues
Fuel Prices
Promotions
Media message effectiveness
In versus out-of-market spending
Marketing synergies
Tactical Investment Guide

14. -1.8%
-1.9% -1.9% -1.7%
-1.8%
-$350,000
-$300,000
-$250,000
-$200,000
-$150,000
-$100,000
-$50,000
$0
Property 1 Property 2 Property 3 Property 4 Property 5
Revenue Impact
Impact of Fuel Prices on Alpha’s Revenues: Every $1 increase in gas
price, costs Alpha’s -1.8% in Revenue.
Impact of $1 Increase in retail fuel prices
Fuel prices had a -1.1% YOY impact for Q1-08

15. Alpha’s AC Promotions: $4M Sweepstakes was
most successful
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
Diamond Acquisition
$4M Sweeps
Other
MillionDollar Weekend
Set Sall
Gift Grab
Vacation Cash
3X Cashback
Hidden Jackpot
Weekly Revenue Impact

16. Print, TV & Radio Optimal Spending by Messages: Calls for Increases
in Entertainment, Gaming and Food/Beverasge, and relative
reduction in Branded and Misc. messages
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Marketing Contribution Current Spend Optimal Spend
Misc
Food/Bev
Entertainment
Gaming
Brand

17. Optimal Spending by Market: Calls for Increases in Markets 1, 3, 5
and National media, shifting funds out of Market 2
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Marketing
Contribution
Current Spend Optimal Spend
NATIONAL/REGIONAL
Market 6
Market 5
Market 4
Market 3
Market 2
Market 1

18. Marketing Synergies: 45% of the total marketing impact is due to synergies
or interactions between two or more marketing drivers. Direct marketing
drives the highest overall synergy, while Online has the highest portion of
total marketing effects due to marketing synergies.
Online
Direct
Direct
Direct
Direct
TV Print
Direct
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
Other Synergies
Primary Synergy
Primary Effect

19. The Marketing Investment Matrix
• The next chart is a visual display of each marketing and media
tactic and program along a spend v. returns matrix.
• Programs in the upper right are high investment and high returns
efforts. These are high stakes and critical ongoing investments in
the future.
• Programs in the upper left are low investment and high returns
efforts. These represent significant upside opportunities for
improving overall marketing productivity and should be expanded
aggressively
• Programs in the lower left are low priority initiatives. They are
neither high investment nor high returns. These efforts are of
marginal importance and can be reduced or even eliminated.
• Programs in the lower right are high investment but low returns
efforts. These are probably in the diminishing returns portion of
their response curves and, although important, can probably be
scaled back to some degree.

20. Marketing Investment Matrix
Radio.Misc.Mkt3
Radio.Brand.Mkt4
Brdcast.Brand.TV.Mkt1
Misc. Print,News.Mkt3
CableTV.Brand.Mkt2
Radio.Brand.Market7
CableTV.Brand.Mkt1
Enter. Print.News.Mkt1
Radio.Gaming.Mkt3
Misc. Natonal.News
Gaming National.Mag
Radio.Brand.Mkt2
Enter. Print.News.Mkt4
Onlline Search
Promotion
CableTV.Brand.Mkt4
Brdcast.Brand.TV.Mkt2
ONLINE.DISPLAYBrdcast.Brand.TV.Mkt4
Enter. Print.News.Mkt2
OOH.Adv Direct.Mktg
Enter & Gaming
Regional.Mag
Radio.Gaming.Mkt2
Radio.Entertainment.Market7
Misc. Mag.Mkt3
Radio.Entertainment.Market6
-
20
40
60
80
100
120
140
160
180
80 85 90 95 100 105 110 115 120 125 130
Index of Spending
IndexofRevenueReturns
High Stakes Maintain/IncreaseHigh Opportunity Expand Aggressively
Dimishing Returns HarvestUnproductive Reduce Significantly

21. -10,000,000
0
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000
70,000,000
Error
Model
Actual
Model v. Actual Revenues: Overall Fit of Model
Outstanding
R2=98.6%
Holdout R2=98.9%
MAPE=+/- 0.7%
Weekly Revenue

22. • Marketing Optimization Modeling (MMO) is not just a technical exercise!
• Business Knowledge & Direct Industry Experience
• You can not succeed by “plug & play” via a CPG approach
• Bottomline Analytics (BLA) takes a “Consultative/Collaborative” Approach
• BLA’s philosophy is “strategic, custom and issues focused”.
• BLA believes and espouses that MMO is and should be an exercise yielding
tangible benefits
• You will know marketing productivity, ROMI and how to optimize your
marketing budget, yielding a tangible dividend
• BLA has some unique tools and methods
• Social media measurement and sponsorship engagement
• Focus on both Media Channels and Media Message
• Marketing synergies
• Marketing spending optimization
• MMO is a Competitive Advantage and One of the Most Powerful Tools in
Analytics.
22
The Way Forward

23. Michael Wolfe
Bottom-Line Analytics LLC
www.bottomlineanalytics.com
mjw@bottomlineanalytics.com
770.485.0270 (o)
678.314.8446 (m)
Thank You!
23