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No resort fees at Virgin (rebranded Hard Rock)?

Discussion in 'Casino Industry & Development' started by azlefty, Nov 10, 2019.

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  1. azlefty

    azlefty VIP Whale

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    From an ostensible news source I had not heard of until yesterday:

    https://www.casino.org/news/virgin-hotels-incoming-las-vegas-casino-operator-opposes-resort-fees/

    As much as I want to root for this, I am skeptical that it is sustainable when virtually everyone else has resort fees. If the Virgin hotel uses online travel agents like Hotels.com booking.com etc, its rooms will be about $40 more than equivalent rivals, and will also need to cover the OTA's commission on the $40 that the hotel would be exempt from if it just charged that portion onsite as a resort fee.

    Your thoughts?
     
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  2. Whilestockslast

    Whilestockslast Low-Roller

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    I am not sure if it is related or not but over here in the UK you cannot charge extra for things you say you do not want like a resort fee - sure they may charge extra if you want to use a certain service but if you don’t want it you cannot be charged for it ( which may well be the case for the rest of Europe as well) the price you see on the tin is what you have agreed to pay and it’s worth noting that American hotel chains over here in the UK operate that way as well. It’s a shame that Americans in general have agreed by going along with paying resort fees in the USA. I hope the hard rock can set the example of positive change in Vegas.
     
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  3. Viva Las Vegas

    Viva Las Vegas Ramblin' Gamblin' Man

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    Love it. They are also paying employees up to 10 weeks during the renovation.

    While many employees are sure to find work elsewhere, those who want to work in the new Virgin Hotels Las Vegas property will not be required to interview again for their previously held jobs,” Bosworth explained. “The ownership group and operating partners are committed to paying them to return and we want them to return.”

    No resort fees. Employees valued and treated well. Sadly a rare occurrence in today's Las Vegas, and alas corporations period.
     
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  4. Stuart Hopkin

    Stuart Hopkin Low-Roller

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    Virgin only enter markets where they believe they can cause disruption that they believe will benefit the customer. Obviously this usually works out well for them as well but I would not be surprised if no resort fees is a firm part of their business plan.
     
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  5. Calder

    Calder High-Roller

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    A hopeful signal, but we'll see.

    The CEO opposes the practice, but there is always "...but the board put its foot down."
     
  6. Vegas24_7

    Vegas24_7 Degenerate

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    I think what Virgin is doing is good but in the end, it ends up being a net zero to the consumer. You can call a "resort fee" what you want but if they remove it, they will just add it as part of their regular room rate. You still end up paying it as a customer if you choose to stay there. To me, the creation of a resort fee is just a marketing ploy to allow hotels to appear more competitive when they can advertise their room rates as being "reduced". If Virgin can come in and offer the rooms at or below other advertised rates in Vegas and still remove the resort fee, then I will applaud them with their efforts.
     
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  7. azlefty

    azlefty VIP Whale

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    Indeed. I keep telling people that resort fees don't cost you more money, they just cost you the chore of doing a little more arithmetic. They might even save you a bit of money (see my previous post). But nobody seems to listen.
     
  8. notfromconcentrate

    notfromconcentrate Connoisseur of dive casinos and obnoxious outfits

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    Respectfully, I think this is a gross over-simplification.

    "A little more arithmetic" is having to figure out a 15% tip on a $75 bill, instead of the bill simply being presented as $86.25. In this case, you have 100% of the information you need (i.e. base bill amount, what percentage you'll tip), and you just have to do a quick multiplication.

    Having to figure out $75 per night "plus resort fee" is more than just a bit of arithmetic. First, you have to find out what the resort fee is. Which, generally speaking, they don't make easy to do. It's not like they make it prominently clear on their website that "Our resort fee is $34.99 per night plus tax". You do often have to go digging to find it on hotels' websites to find that out. So then if you're trying to figure out the cost of a three-night stay, it's slightly more arithmetic to do (3 * 75) + (3 * (34.95 * 1.1138)) = $341.78. That's clearly more complicated than just calculating a percentage.

    So when you're shopping for hotels, you have to do research AND arithmetic, all to find out a price that even a battery-powered pocket calculator could calculate a bottom-line total for, if the information was provided in a transparent manner.

    Make no mistake, the hate for resort fees generally has nothing to do with the monetary cost. It has to do with being honest and forthcoming. Everybody wants to know "How much will it cost?" when they're shopping for hotels. The hotels that charge the resort fees know exactly what the answer is... but won't give it to you.

    That has set a very low standard of honesty in the hospitality world... and Virgin, very astutely, has identified that as a gap that is ripe for disruption where they can be upfront about their actual bottom-line prices.
     
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  9. azlefty

    azlefty VIP Whale

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    @notfromconcentrate I don't follow your math. Is the 1.1138 equal to 1 plus the occupancy tax? If so, doesn't that also apply to your room rate of $75? If so, the math is a little easier if you think of (75 + 35) * # of days * (1+tax).

    Yes, it was a simplification. And don't get me wrong, I am also very annoyed by the lack of transparency and I don't mean to defend resort fees. I agree that they are extremely annoying. But for anyone like me who is a repeat guest, their existence is no longer a surprise, and thus less annoying than the first time I had to deal with them.

    I tend to think about it this way: I've gone to Vegas at least once since 2010, and in fact about 20 times since then, so I know there will be a resort fee. I might not know exactly what it is off the top of my head, but I expect from recent experience that it will probably be around $25 if I'm staying at a Boyd casino, $36 at a Station, $45 on strip etc. So I can quickly assume that my room will cost # of days * (room rate + resort fee) * (1 + tax). But for comparison purposes, I have to pay the tax everywhere and the daily charge everywhere, so the number I need is really room rate + resort fee. For example if my room at the Palace Station is $41 and the resort fee is around $36, my room will be about $77 per night plus taxes. Or I could stay at the Gold Coast for $55 + 25 = 80 plus taxes per night, etc. I might be a few dollars off, but it's close enough for the purposes of my decision whether to stay there. if the Virgin is going to be, say, $120 with no resort fee and a comparable product is, say, the Palms at $70 with a resort fee in the $40's, the decision I have to make is $120 vs (70 + 40 something) = 110 something. Both have to be multiplied by tax and the number of days I stay.

    I'm much more affected by the inflation of room rates generally. Just about 5 years ago it was easy to find a midweek room for less than what the resort fee is now. I don't gamble nearly enough to get comped, but I imagine if I were expecting comped rooms and had to pay a resort fee, I would really be steamed, as would I be if they tacked on some new annoyance fee (elevator service charge? or how about: a fee for the privilege of being annoyed by an extra fee?) that I wasn't previously familiar with. But if I had a choice between 2 otherwise similar hotels, I would rather choose the room with a room rate of $1 + $50 resort fee than a room for $60 with no resort fee, all else equal.

    I digress, and I know this topic has been beaten around so I will try to resist commenting further on it. My main point is that if Virgin is the only hotel without the resort fee, I wonder if people who spend less time thinking about such things than present company will recognize that what appears to be a higher rate actually isn't, as in the examples above. If you are comparison shopping, you will still need to estimate the rate at the other hotel with a resort fee. I don't expect they will be competitive simply by lowering the cost structure, a la Southwest Airlines in the 1990s, or Virgin for that matter. Most hotels are already squeezing costs wherever they can, e.g. self service beverages.
     
    Last edited: Nov 11, 2019
  10. BlueBellThunder

    BlueBellThunder VIP Whale

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    When CET didn’t charge resort fees, I would always get comped rooms Sunday thru Thursday. I still get comped rooms, but have to pay the resort fee. Perhaps these days if there was no resort fees, they would charge me a small amount for the room, perhaps not. But it’s hard to complain about resort fees as long as I’m getting comped nights.
     
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  11. 3OfDiamonds

    3OfDiamonds Vegas is Fabulous When You Degen Responsibly ;)

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    I used to have Virgin Mobile phone service, I shopped at Virgin Megastores, would probably fly or at least consider Virgin if they had routes I needed, and may even try a Virgin cruise once they start... I heard the Virgin train service in the UK was s**t (very high prices sometimes, meh-at-best level of comfort and service... may be a bit of monopoly power in play) but normally Virgin companies tend to offer solid value and something refreshing/innovative in whatever space they enter :)
     
  12. mhetrick

    mhetrick Low-Roller

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    While Virgin will be running the hotel, remember that Mohegan Sun will be operating the casino. They will be utilizing their Momentum players card system. According to information I've found online, 1 slot point = $167 coin in. 1 vp point = $270 coin in. Points are a 6 month reset period. April - September and October - March.
     
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  13. Calder

    Calder High-Roller

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    If you're paying for a comped room, it's no longer a comp, it's a discount.
     
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  14. notfromconcentrate

    notfromconcentrate Connoisseur of dive casinos and obnoxious outfits

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    Thank you for your caution re: the beaten topic. Just two specific replies...

    The Math: You're right, I did miss the tax on the room rate. Though as I understand it, that's taxed at a different rate than the resort fee (I think because one is lodging and the other is technically "service"). So perhaps going with the example it would be ((75 * 1.tax) + (35 * 1.tax)) * #days = Bottom line total

    Average Non-VMB Person Comparison Shopping: Fair point, I think the no-resort-fee Virgin hotel is somewhat likely to get "lost" in OTA searches because of how its price will appear higher. It's possible they may employ a strategy like the Four Queens, where all of their OTA listings make "No Resort Fee" very prominent (e.g. on the main property image, even in the property title). Even a Vegas first-timer who's shopping around is bound to discover resort fees when they try to check out for the first time. So if someone has spent the past ten minutes fiddling with prices at Excalibur and NYNY trying to figure out why three nights at $75 per night is now showing on the checkout page that the "total" cost of their trip is more than $340, then "Virgin Hotel Casino - No Resort Fee" could very plausibly stand out to them.

    It will be interesting to see it unfold. Having no resort fee sure hasn't stopped the Four Queens from doing business... so we'll know soon enough if they're onto something!
     
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  15. insin

    insin Speed Spender

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    And one more wrinkle in the true room rate math - downtown hotels have a different tax rate than the strip hotels do.
     
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  16. eksantirik

    eksantirik High-Roller

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    You book a hotel, at some resort fee amount, and they move it up and your cost changes even before stepping into the hotel. Also, you get a comp room, you go there and you are asked to still pay the resort fee. Before the resort fee, comp rooms were just that, comped.

    And it's deceptive to the customer and unethical to the 3rd party booking sites. Some customers might be clueless about this and they might have made a bad selection. And as far as the 3rd party sites go, all these hotels utilize their services but when it's due payment, they do bogus stuff to decrease the amount they owe. Well if you don't like 3rd party sites or if you're not getting advantage out of it then just don't list your room there.

    So I strongly believe there is no advantage of resort fees except to the businesses that charge them and to the local governments that tax them.
     
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  17. Init2winit

    Init2winit Low-Roller

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    That's how the casinos are reeling customers in. With ever increasing resort fees, more casinos can offer even more "comp" rooms since they're essentially making more money from the resort fees.
     
  18. mikel123

    mikel123 High-Roller

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    Just because the owner doesn't like the practice doesn't mean they will not implement it. I hope they don't, but I'd point to Derek Stevens' statement when they implemented the resort fee back in 2013:
    [​IMG]
     
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  19. azlefty

    azlefty VIP Whale

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    Yes, this was kind of what I was thinking. Hopefully there are enough experienced customers to recognize the benefit of no resort fees so they can price accordingly.
     
  20. Rob6 8

    Rob6 8 Low-Roller

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    If it is successful more casinos will follow if not none will try for awhile. These companies are sheep.
     
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