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Vegas Reinventing

Discussion in 'Casino Industry & Development' started by xman30, Mar 27, 2016.

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  1. xman30

    xman30 Low-Roller

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    Saw this article today:

    http://www.reviewjournal.com/business/neon-rebirth/the-vegas-brand-strip-reinventing-its-appeal-tourists

    Good read with a lot of numbers. Things seem to be rebounding nicely for Vegas.
    ---
    Another article. Published the same day as the first:

    http://www.reviewjournal.com/business/neon-rebirth/family-friendly-sin-city-what-does-las-vegas-have-kids
    ---
    Another interesting article:

    http://www.cnbc.com/2016/03/17/nevada-economy-plays-winning-hand-heres-its-secret.html
    -----

    xman30
     
  2. smerrian

    smerrian Low-Roller

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    Always good to see.
     
  3. Funkhouser

    Funkhouser In Charge of the Big Door

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    The first article seems to be a PR piece more then a good journalistic attempt at explaining the changes. Members of this board know for instance that the amount of fees being generated by operators has climbed to ridiculous levels. That adds to a huge revenue boost to these operators. While one can't ignore the proliferation of gaming across the US, does it really signal that people coming to Vegas are spending less time gambling? I argue an emphatic NO! Quoting the article "More of our revenue has been non-gaming than gaming, and we’re seeing that trend continuing," Gee do you think the reporter maybe ignoring the fact that prices for everything has climbed over the last 7 years has outpaced income in the US. So of course people are spending more dollars. I bet if these prognosticators looked at it from a percentage of budget spend or time spent gaming we would not see a shift. People are just having to fork over more money for other things in Vegas due to comp reduction and the price tag being raised. A 3 dollar spin on a slot machine still only costs 3 dollars, while a cocktail may have jumped 25% in the last 7 years.

    These articles IMHO are set to re-enforce the self proclaimed narative that people coming to Vegas want less gaming. I think the truth is, people coming to Vegas want better gaming but the operators want more stable income.

    Lastly one can't ignore the impact that the real estate crash had on Vegas. Vegas draws a huge number of tourists from the CA market which had grossly inflated real estate (along with alot of the country), people had false wealth in the form of inflated home values. Those inflated values wiped out investor wealth and Mom & Pops HELOC lines when the market crashed. That had a huge impact on Vegas spending.
     
  4. joespoolhall

    joespoolhall Low-Roller

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    I think Vegas, as with the rest of the country is definitely on the rebound. I have followed the numbers for years and it is coming around, but not near the glory years. I think people are spending more in non-gaming areas. Part of that is the decreased VP tables and BJ with bad rules. A certain number of visitors understand the value of different game offerings. I think the majority just doesn't understand or maybe even concern themselves. Food prices have shot up because restaurant owners named Gordon, Bobby and Giada don't offer $9.99 prime rib specials. More and more people are making food a bigger part of their Vegas experience. The same can be said for day/night clubs, shows and spas. I think a large percentage of strip visitors are looking for a more balanced visit than before the recession.

    On the other side of the coin, I think the locals spots today offer a better room value than 15 years ago. 20 years ago we'd stay at the Orleans, Gold Coast and Sam's Town for about the same as today with the resort fee. Understand we were low rollers, so comped rooms were few and far between.
    They throw me a bone here and there and sometimes good discounts, but that's about it.

    Overall though, LV is still a great bargain. Comparable rooms would be probably twice the rate. Food on the strip is no less, but locals joints still offer a very good food value. Times change and LV sure has, but I also think most of the visitors game plans have also.

    Good Luck!
    Ric at Joes
     
  5. xman30

    xman30 Low-Roller

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    I'm of the opinion that it doesn't matter where or how visitors spend their money while they're in Vegas. Attendance is going back up. Use to be that gambling was the only reason most people went to Vegas. I guess it could be said that the casinos painted themselves into a corner when they started adding other things for people to do: shows (especially with headliners), attractions, shopping, restaurants, tours, clubs etc. Making the city more kid/family friendly. A lot of people don't need gambling to justify going to Vegas. Vegas is called The Entertainment Capital of the World. I very rarely gamble. I haven't done any gambling my last two trips. The most I've gambled during a trip is $10. That's $10 for the ENTIRE trip, not in one hand, roll of the dice, etc. I go to Vegas for sight seeing, attractions, restaurants, shows, photography (I'm an amateur photo nut).

    xman30
     
  6. Russwin1

    Russwin1 Tourist

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    Without a doubt the CA drive-in market is a big driver on revenues, but to me these numbers are due to the rebound in convention business. Conventioneers and the sponsoring companies spend almost all of their $$ on booze, food, and rooms. The Cali kids spend on the clubs, which I'm assuming is the "other" category from the RJ article.
     
  7. joespoolhall

    joespoolhall Low-Roller

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    I know a number of friends that do most of their gambling locally and take far fewer trips to LV or Reno. Unless you're playing good table games, I don't know why in Wa. I do think there is a parallel there though. Slots in this state are not slot machines. The state compact only allows video lottery terminals that pay at the same rate as the lottery. That is 60%! Nv law dictates 75% pay at minimum. I think very few in this state realize that or they wouldn't play machines. I think the parallel is that a lot of LV visitors don't know there's a difference other than "thinking" a machine is just tight. To them gambling is gambling.If that weren't true, the strip would be a very lonely place, but it isn't.

    Good Luck!
    Ric at Joes
     
  8. Funkhouser

    Funkhouser In Charge of the Big Door

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    I agree with your assessment. There is a solid percentage of visitors of whom gambling holds no appeal. My wife for instance could go to Vegas and never drop a dime in a slot machine, but completely enjoys shows, meals, spa, etc.
    I am a complete degenerate who enjoys the play and rarely has a winning trip. In my mind the comps offset the gambling losses, but with the recent squeeze (past 3 - 4 years) I am struggling to find value in my Vegas trips. So in reality its
    not that I desire to gamble less in Vegas, its more so the value position for gamblers has really worsened.

    While hotel rates can be bargains at certain times for a vacation, its offset by high F&B costs. If at sometime in the near future Vegas eliminates comp drinks, reduces room comps, and continues to raise fees (which I currently avoid as a Tier level player), then I would give it
    up as a vacation destination since it would no longer make sense to travel there to vacation for me.
     
  9. daubbermom

    daubbermom Tourist

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    I don't gamble very much either, we go for the entertainment and scenery. Going to Sedona this time for the day. Very excited.
     
  10. shokhead

    shokhead I'm no big spender!

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    Y and Z generations would rather shop, party and all the stuff Vegas has except gamble. That's now on their list. That's why the new shopping, bigger better places to eat, drink and party.
     
    Here we go again!
  11. hockeymom

    hockeymom Tourist

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    Call me crazy ( and maybe old ), but I'll take Vegas when it was run by the mob. The pit bosses knew your name and you didn't have to be a high roller to get a free meal at a top notch restaurant. I miss the personal service we used to get. Plus now you can't walk the streets without running into the youngsters drunk out of their minds.
     
  12. REELmoneySlotFan

    REELmoneySlotFan High-Roller

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    Looking at it from an international point of view Vegas is becoming a very expensive tourist destination. I my opinion, Vegas has a very big focus on the domestic market. Customers from out of the country don't really warm up to offers for 3 comped nights and $100 of Free Play or Resort Credit. I don't know any people from Europe who travel to Vegas for 3 nights for example. Most European (returning visitors) stay in Vegas for 7 or 8 nights at least. Simply because of the fact you do not want to travel 20 hours, stay in Vegas for 3 nights and travel for 20 hours again to get back home. At the same time, Vegas wants it all. It wants you to spend money on gambling (with gambling odds and slot machine backback percentages getting worse throughout time). They also want you to spend money on shows. Prices for show tickets have gone up for several shows. Resort fees are increasing and room rates are going up as demand picks up. More gourmet restaurants with well known chefs connected to them means higher prices for food. Prices for food and beverage at the Las Vegas pools have gone up significantly during the last couple of years (pay $25 or more for a frozen cocktail or $35 for a bucket with 5 beers). Oh, and Vegas is a shopping destination so add some money for that to your budget as well.

    When you add it all up (air fare, room, gambling, shopping, shows, drinks at the pool, some nice meals) it pays out to do your gambling at local casinos and visit other destinations for your vacation. For example, we have been going to Vegas twice a year since about 2008. We budget a total of $5500 per trip (eveything included) which gives us the oppertunity to enjoy Vegas for 8 days like we want to. In about 3 weeks we'll be staying at a 5-star luxury resort at the Turkish coast with an 24-7 all-inclusive formula with great food and whatever you want to drink. We are bringing our kids and will be staying for 14 days. They have several great pools at the resort, with fun slides for the kids and a complete entertainment crew. We'll have weather like Vegas in april and for the 4 of us, we'll be paying around $4000. That's $1500 less than we spend on Vegas on average while we're staying in Turkey twice as long and we're bringing the kids (which we never do when travelling to Vegas).

    Long story short: for a lot of domestic visitors Vegas is rather cheap. So there's a lot of good reasons to return frequently. For international visitors, that's a whole different story. You have to be nuts about Vegas to justify the money you spend compared to the money you'll spend elsewhere.
     
  13. shokhead

    shokhead I'm no big spender!

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    Yet the international visitors keep coming. That would be the one's that like fine dining, shopping, clubs, night life and lights. They like everything Vegas has to offer. You don't see the international family with their children but you do see them with their older parents. The one's that do have their kids do come for only a few because they come to the US and rent a car and drive everywhere inc Vegas.
     
    Here we go again!
  14. REELmoneySlotFan

    REELmoneySlotFan High-Roller

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    Yes they do but you'd think Vegas was aiming to get more returning customers. Many international visitors come to Vegas once. Taking all the costs into consideration most Europeans for example go to Vegas once and that's it. Just to be able to say: "been there, done that, cross it off the bucket list". Vegas wants returning customers, people that join their players clubs and continue to spend their money in Vegas multiple years in a row. With the overall price level going up, I really doubt they are accomplishing that (at least for the European market).
     
  15. shokhead

    shokhead I'm no big spender!

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    The one's that return are the one's they really need to return.
     
    Here we go again!
  16. REELmoneySlotFan

    REELmoneySlotFan High-Roller

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    True but they really could benifit more. In my opinion Vegas is focussed on short term success too much. They could have a lot more international returning customers if they would put more marketing effort into that and if they would do more to customize their offers for the international market. Vegas' main focus is California, US and (Asian) High Rollers. We saw how much that hurted Vegas during the economic downturn in 2008-2013.
     
  17. bigalbr

    bigalbr VIP Whale

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    What am I missing here? Gaming is the number 1 revenue source, followed by things that gamblers need (rooms and food). Beverage and Other is still way behind. There is an ongoing narrative that gambling is not Vegas' primary driver, but anybody that actually looks at the data understands that gamblers are what makes Vegas work.
     
  18. shokhead

    shokhead I'm no big spender!

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    Gaming is NOT the number 1 revenue source anymore from what I remember reading.
     
    Here we go again!
  19. leo21

    leo21 VIP Whale

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    When you look at the big picture, you can't bank on the international visitor to keep coming for the reasons pointed out. Vegas was drawing the international visitor because of a weak dollar that is now strong. Many international economies are weakening. Vegas has banked on the international customer and I am not sure they are prepared for losing that business.
     
  20. shokhead

    shokhead I'm no big spender!

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    Weak or strong $ isn't new. The fat cats will come no matter what the dollar is doing. True, weak $ over there means the families do travel a lot less. I see that when in Maui. Whoever has the strong $ are the one's visiting in Maui.
     
    Here we go again!
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