Shining in the Valley of the Sun
July 16, 2009
Casino Arizona, flagship of the Salt River Pima-Maricopa Indian Community, has been a popular destination in the Scottsdale area for 12 years and has expanded to two locations. The tribe hopes to repeat that success when it opens its must-see Scottsdale resort, Talking Stick, early next year. Talking Stick Resort will feature 100,000 square feet of space and 497 hotel rooms along with a state-of-the-art spa, extensive conference and meeting facilities and first-class dining and entertainment. CEO Jon Jenkins spoke recently with Casino Journal Managing Editor Marian Green about the new resort and Casino Arizona’s success in weathering the current downturn.
Give us a sense of how it will all work at Talking Stick.
Jenkins: Well, we’re really going to have two brands. We’ll have Casino Arizona at Salt River, and that’s essentially the casino at McKellips Avenue and Highway 101. It won’t have any rooms attached to it. It’s more of a fun, lively “club” brand. The “resort” brand at Talking Stick Resort will be a casino and a hotel and a convention center, and it will be adjacent to a 36-hole golf course, the Talking Stick Golf Course that’s in existence now, and it’s one of the premier places to golf in the Valley of the Sun. All of those entertainment features will be seamless to our guests, and they’ll all be tied to the enjoyment of the stay. A very diversified entertainment package.
So you’re really attacking different market segments and demographics.
Jenkins: Yeah, we are. Everybody wants to fill their rooms. We’re trying to fill our rooms with people who like to play.
It’s going to be one of the few resorts opening at this time. Does that give you an edge?
Jenkins: A lot of people have held back on their development plans. But we were lucky to start ours before the downturn. We had ours financed and planned. So when the downturn happened we were already under construction. And, you know, we just might be opening right when it’s all over, or at least when it starts turning up. For us to have all these new, exciting features, and a reputable product, I think, is a good position for us to be in, and we’re excited about that.
How have these challenging times affected how you operate?
Jenkins: With the sheer number of casinos in the gaming industry we’re all tied to how the local environment is doing. If the local economy is off your consumer spending is going to be off somewhat proportionately to that. And you have to compensate for that in creative ways. And that’s what we’ve been working on — sell and market our way out of these down times, versus laying off people. We have not done that.
How have you been able to avoid layoffs?
Jenkins: What we do here with very single decision that we make, from marketing to producing the product to delivering the product, is we take into consideration the guest experience. And if it takes away from the guest experience then we usually avoid it. If it adds to the guest experience or simplifies it or raises the level of their entertainment and it’s cost-effective for us we typically do it. And we let attrition take its place. We staff and we purchase to our existing volume, like most good operators do. Whatever that volume is, we want to keep our margins intact, and we don’t want to diminish the guest experience. We are very careful to honor that experience that we offer, and that’s a quality guest experience.
In this respect are you more insulated than, say, a tourist economy like Las Vegas?
Jenkins: At our development cycle here now we are more of a regional casino. It’s more of a locals-type casino, because we’re just building our hotel and convention amenities as we speak. So we have the luxury of a strong market. Our market here has been affected, but we have not been as affected as other parts that we hear about in the industry.
What are your customers telling you about their situations?
Jenkins: That’s one thing we do consistently. We listen and communicate with our customers to know that we’re doing the right thing. What they say to us is, they feel the need to go out and have a good time. That’s one thing good about our industry: it is a good-time industry, and it allows the guest to escape from their day-to-day life, live it up a little bit within reason and within their budget and enjoy themselves so they can come back. And we try to provide them with a diversified product so we can interest them in more than one way.
Are they coming as often and spending less, as has been the case in places like Las Vegas?
Jenkins: Yes. We’ve had some months where we’ve far exceeded our head counts of last year. But still the consumer is cautious somewhat, and they’re not playing like they used to, even though their visitations may be the same. There’s still a soft market with consumer spending. But you just need to staff and plan accordingly for that, and you can still keep your margins high. Form those relationships, deliver the promise of a good time for them, and they’ll become a repeat customer.
Does this mean a return to more value-oriented promotions?
Jenkins: I think everybody, those that are marketing well, are not necessarily doing as much image marketing but doing more promotion marketing, doing value-perceived deals for the consumer. The deal may be entertainment or it may be food and beverage, but you want to develop a perception of your product as a one-stop-shop for entertainment, everything from dinners to shows to gaming, the full gamut of the entertainment experience. Not to say that image isn’t important, it’s just that you spend less on image and more on direct-response promotions.
As far as spending on the gaming side itself, has the economy affected your ability to go after new product?
Jenkins: I know a lot of gaming companies have held off on new product installations, but we’re still rolling out new product, new table games, and we haven’t missed any opportunities on new slot product. I guess we’re not as free and easy with our spending as we used to be. It all has to be justified, of course. Our spending here is all focused on the guest experience, and if the guest wants it we’ll find some way to do it, within reason.
What are some of the other things you’ve been doing to counteract the downturn?
Jenkins: We’ve had the good fortune of having our blackjack limits raised in the state recently, and I think that’s opened up some market segments that we had not previously had the opportunity to expose our product to. And also we have a national sales force that has been traveling coast to coast, border to border, selling the upcoming resort. So there’s a lot of talk out there about our product in a lot of the group sales markets. Scottsdale is a very attractive place for people to vacation and visit, and we’re going to be a good part of that draw with our amenities. I think we’re going to be a good partner with the tourism efforts here. We do our regular bread-and-butter promotions and our franchise promotions, such as tournaments and giving away chances to win a night’s stay at [Talking Stick] resort. We try to keep it interesting and fun to keep our guests entertained and keep them coming back.
Jon Jenkins, president and CEO of Casino Arizona, has more than 30 years’ experience in gaming development and management in both the commercial and tribal sectors. Prior to joining Casino Arizona he worked with the San Carlos Apache Nation’s Apache Gold Casino Resort in San Carlos, Ariz., and with the casinos of the Menominee Indian Tribe of Wisconsin.
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