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Gaming still the largest source of Revenue for CET.

Discussion in 'Casino Industry & Development' started by Guy_, May 28, 2017.

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  1. Guy_

    Guy_ VIP Whale

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    upload_2017-5-28_18-49-22.png

    After being told over and over that gambling is a small portion of the Money brought in to casinos.. this was refreshing to see gaming still bringing in almost 60% of Caesars revenue.
     
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  2. Guy_

    Guy_ VIP Whale

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    anyone notice a CET brand missing in the 2017 Strategy?
    upload_2017-5-28_18-53-55.png
     

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  3. makuk

    makuk Low-Roller

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    Ballys.
     
  4. tringlomane

    tringlomane STP Addicted Beer Snob

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    That makes me worry about CETs health though.
    Someone tell Robin Leach!

    I would hazard a guess that someone messed up.
     
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  5. smerrian

    smerrian View from Bally's

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    Now I see why they press so hard to push the clubs and the 20-something interests. If I was an MBA-suit at Caesars Corp I wouldn't be happy with that 11% entertainment figure.
     
  6. bigalbr

    bigalbr VIP Whale

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    I think this chart is for all of CET, not just Vegas. Outside of Vegas, most casinos don't have large revenue streams outside of gambling. At least not the ones I've been to.
     
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  7. tringlomane

    tringlomane STP Addicted Beer Snob

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    Good catch. The fine print says numbers are based on an "enterprise wide basis".
     
  8. 93 Octane

    93 Octane Chief bottle washer

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    Who said gambling is a "small" portion of revenue? I've never seen that quote anywhere
     
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  9. thecarve

    thecarve Misanthrope

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    :clap: I figured it would take a lot longer for the VMB crew to catch that. Folks do like to do whatever they can to massage facts to agree with their world view.
     
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  10. VegasDave

    VegasDave Addicted

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    I dont know that anyone said gambling was a small portion, but the clubbing/nightlife atmosphere brings in people that are willing to spend a lot of money in and out of the clubs. Gaming vs ALL non-gaming revenue is a different story:

    https://ggbmagazine.com/article/non-gaming-revenues-for-major-las-vegas-casinos/

    CET really only has one top tier club, Omnia, so it is not a focus for them obviously, but as far as the clubgoers, you can't take club revenue in a vacuum as it seems to add more gaming revenue with the traffic it brings in.
     
  11. tringlomane

    tringlomane STP Addicted Beer Snob

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    To be fair, I don't think OP intentionally meant to mislead. The big title on their slide does highlight Las Vegas.
     
  12. Guy_

    Guy_ VIP Whale

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    I just posted the info.. I never said it was specific to Las Vegas and don't see anywhere that I indicated otherwise (with the exception of posting it on a "vegas message board").
    There was no massaging of the facts or deception intended to sway people to my "world view"
    If I did somehow give the impression that this was specific to Vegas, please highlight where so I don't make the same mistake again.

    The comment of Gaming being a small portion of the casino's revenue may not have been a quote on here, however I have read countless articles stressing that casinos were focused more on the non gaming revenue because it was a higher profit then what gaming was bringing in with significant room for growth while gaming continues to shrink.
    Even my local host at Caesars Windsor has said that comps are harder then ever to get more then the basic stuff because too many people are willing to pay for everything and it is easier to take $1500 from the partier on a night/weekend then getting that from a lot of the gamblers who expect free rooms, food, shows etc. (I still get all the perks listed but I used to get suites and other perks that I no longer get with my bankroll remaining the same or larger)
     
  13. Auggie

    Auggie Dovahkiin

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    That has been referenced on here a few times over the years, there have been some long threads on the subject in the past.


    But it is a little misleading though:

    The reports will say stuff like: "In 1980 gaming made up 95% of the casino's revenue, in 1985 it was 90%, in 1990 it was 80%, in 1995 it was 75%..." etc (these numbers made up for example).

    At first glance that makes it sound like people are gambling less and less over the years, but the reality is just that there is more you can spend your money on today. In 1980 a casino probably had a lounge, a coffee shop, one decent restaurant, a gift shop and then maybe one or two specialty shops... today the casinos will have high end luxury stores, night clubs, fancy bars and drinks, plenty of shows - in all just so many more options to spend your money on.


    Going back to the original post about CET, all that said still covers why CET can still have more gambling revenue than other: they have more regional/locals casinos, which don't have the high end shopping options, and even in Las Vegas they still have that same approach where some of their casinos have shopping, and in particular high end shopping, but most of their casinos don't.
     
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  14. leo21

    leo21 VIP Whale

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    The general justification for claiming casino space for other things or for bad casino games or for games that they think a millennial can love or celebrity restaurants or more clubs, is that gaming is a smaller part of the revenue flow. The suits can even make it sound like gaming is a dying business. Percentage wise the share of the revenue is way down compare to decades past but this shows it's still a vibrant revenue source that deserves better treatment than the suits give it.

    I wouldn't be shocked if the revenue share for CET in Vegas is more around 50%. I think MGM is supposed to be less than that. Since I think gaming is a great way to make money in a gaming town, I don't see this as a bad thing but if you buy the line from the corporate suits it's a problem. For CET, they don't have those tourist attractions other casinos have even though I think they are keeping up in dining and retail. Outside of Vegas, their casinos that do have live entertainment are usually more free cover bands set up to sell drinks. I've seen situations where they could do more to get more revenue from hotels, entertainment and the like and don't seem really willing to make the investment to do it. It feels like if something can't be rolled out to instant and sustained success, they aren't interested and some of the non-gaming revenue will take some selling to catch on.
     
  15. The Rumor

    The Rumor VIP Whale

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    I would also acknowledge the rebrand of Bills into Cromwell, which was about generating higher room rates and updating Drais. This had to be a big rise in non-gaming revenue, although I wonder if the casino is down relative to before.

    They've also been building out the shops in LV.
     
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  16. MiamiDave

    MiamiDave You Can't Handle the Truth

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    Let's not make it sound like gaming revenue isn't down, though. It's not that it's down as a total, it's down on a per person spending basis.

    If you adjust for inflation, the average gambler today is bringing to Vegas a gambling budget that is about 40-50% less than what it was 20 years ago. They're also gambling for shorter periods of time because they're dumping their small budgets into slot machines.

    The only reason gross gambling revenues are at the highest they've ever been in is because there has never been more visitors to Vegas on a yearly basis than there is today. It's sheer brute force that the gross numbers are higher, but there are still some very concerning trends for the casinos. The problem is: instead of trying to make people play more, they're trying to instead increase their profit margins by reducing odds/payouts/etc. to make up the losses on a per capita basis.
     
  17. Nevyn

    Nevyn VIP Whale

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    CET is not exactly the leading edge of the strip, though.

    They cultivate low end players with locals casinos, have the lower end of the strip hotel market, discount aggressively to fill rooms. They also have much less in high end eateries and top clubs than other properties.

    In other words, its not so much that they are killing it on gaming, they just don't really have a toehold into the other markets the way Wynncore, Aria, Cosmo, etc do. But even they will slowly be looking to change that where they can.
     
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  18. Grid

    Grid Well-Known Member

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    In regards to Las Vegas:

    Gaming is still the largest single source of Revenue. In other words, that is still the largest individual segment, on average, in LV. But it is also true that it is no longer the engine that drives casino resorts. Its 34.24% gaming + 65.76% "other".

    In 2016, hotel rooms now generates 28.12 percent of the revenue for Vegas Strip casino operators. That’s up from 16.10 percent of revenue in 1984.

    In 2016 revenue from food was 15.98%. In 1984 it was 11.41. Booze makes up another 7.17% (think fancy drinks and bottle service). Food and beverage revenue have increased by approximately 50 percent and 100 percent, respectively since 1984.

    In 2016, casinos on the Vegas Strip generated 34.24 percent of their revenue from gambling. This revenue stream has been decreasing for years. This is a far cry from 1984 when 58.63 percent of the Vegas Strip’s revenue was from gambling.

    I guess it all depends on if you are a glass half full person or not. If you are just looking at all segments, gaming still holds the largest slice of pie. But unlike years past, that pie is no longer 60% gambling 40% other. Its now just a third of total revenue.

    There are 40 Total Rewards casinos. The vast majority of them are gaming only with maybe a cafe & buffet. Some don't even have hotel rooms, and most don't even have a venue for shows or clubs. So their only profit stream is pretty much gaming. Its more of a microcosm for CET then it is for gambling in vegas. If CET shut down all of their casinos in LV, I bet their gaming revenue, as a whole, would shoot up another 30%. Vegas "other" revenue is bringing down their overall gaming reportings percentage.
     
  19. shokhead

    shokhead No big spender unless eating drinking having fun!

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    I never heard or read that gambling is a small portion of the Money brought in to casinos but now is the 2nd instead of the 1st. Not sure where you told.
     
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  20. Grid

    Grid Well-Known Member

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    Gambling, on the Las Vegas strip, is a small portion of the overall money brought into casino. All of the facts and figures I broke out can be viewed below in the UNLV Center for Gaming research site. The report starts in 1984 and ends the last day of Dec 2016. So the facts I broke out in my post above you are from here.

    http://gaming.unlv.edu/reports/NV_departments_historic.pdf

    As I mentioned earlier, gambling is still the life blood of nearly every single locals casinos. Of which CET owns or partners with roughly 30 of them. So as an industry, gambling is still King Kong at the vast majority of casinos. But since we are in the Las Vegas message board site, I was pointing out it is a small segment in Vegas now.
     
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