It’s no secret that the casino industry is development and operations driven. Ideally, within a multi-property gaming enterprise, there is a balance of sorts between these two business segments-a flow of new product in the development pipeline that will eventually open, and once operating, be accretive to the bottom line, allowing the company as a whole to grow. Imagine the whole process as some type of combustion engine; where new construction is the fuel and operations the pistons, the two working in concert to move the entire business forward.
Now envision a sudden embargo on gas and you have some idea of the challenge facing gaming operators these days. New casino development is at a standstill, a victim of a seemingly unending recession combined with a tight and overly restrictive lending marketplace. Not so long ago, a casino enterprise would have multiple new projects under construction, one scheduled to open after another in a steady progression. Now even the most robust companies are lucky to have one or two ground-up developments planned for the future.
In a market where development has dramatically slowed, casino enterprises have no choice but to rely on existing operations to satisfy both short- and medium-term growth. In this scenario, the question for every operator becomes just how far can I grow the bottom line with the casinos I already have in place? In other words, how far and fast can I push the business engine with little gas and no stations in sight?
One way around this problem is to become more economical, to cut costs where you can and grow the bottom line through efficiency. This strategy, however, can only take a company so far-at some point it’s going to run out of ways to generate meaningful growth through cost cutting. Perhaps a better solution is to consider ways to boost business at existing properties, which essentially means finding ways to get more people through the doors and staying longer.
Attracting people and finding ways to keep them coming back? Sounds to me like a job for the marketing department. Unfortunately for the casino industry, the marketing department is very rarely involved in any type of meaningful strategic planning within the typical gaming enterprise. Don’t take my word for it. Anyone who regularly reads Dennis Conrad’s marketing column in this magazine knows he has been pushing for marketing inclusion at the strategy table for quite some time. Randall A. Fine, managing director of the Fine Point Group, a leading full-service gaming consulting and management company, takes this thinking a step further, and says the only way to really maintain gaming growth in the current business environment is to capture greater market share. For gaming companies to accomplish this task, he believes a marketer should be running the entire enterprise.
Whether you think a marketing person should be in charge or not, it never hurts to be up-to-date on the latest marketing trends and products. The upcoming Casino Marketing Conference, which will take place July 19-20 at Planet Hollywood in Las Vegas, is a way to get all this information in one convenient stop. Sponsored by Raving Consulting and BNP Media, the parent company of Casino Journal, this year’s Casino Marketing Conference features a host of informative sessions and keynote presentations from Dick Anderson, former GM of Media and Entertainment Industry for IBM; Javier Saenz, executive director at IGT; and Ginny Shanks, CMO, Pinnacle Entertainment. For more information on the Casino Marketing Conference, visit www.casinomarketingconf.com.
Bring your overalls. Maybe your misfiring casino engine could do with a bit of marketing fine tuning.