As the casino industry confronts changing demographics, much attention has focused on non-gaming assets, as they are proving more popular with younger players than the gaming product itself.
This is a challenge, of course, because the industry profit model, especially outside of Las Vegas, remains gaming-centric. But that doesn’t lessen the growing importance of non-gaming products or the need for marketers to understand exactly how they should be thinking about the non-gaming side of their casino.
This topic was ably addressed at a player development panel at VizExplorer’s inaugural OiSummit in Las Vegas.
Here are some excerpts:
Jim Korona, vice president player development, Planet Hollywood/Bally/Paris: At the Caesars properties here in Vegas we have a retail host team. We also have a team called Total Experience. There’s a segment of the market that falls into this area… bachelor parties; girl’s weekends; wedding parties where customers are willing to spend on fancy dinners; cabanas at the pool; large suites and so forth. But when an executive host would qualify these customers and find out if they gambled, if they said, “no,” the hosts were not interested, so that’s why we created separate teams.
We’re continuing to evolve with tracking retail spend. It becomes a bit more difficult because when you think about all the different outlets that you have at your properties, margins are different. The margin for beverage is different from one of your restaurants and here in Las Vegas the majority of properties don’t even own their restaurants; it’s a third party. So how do you track that spend and formulate what the reinvestment is and are these customers loyal? Right now, I haven’t found that much showing retail customers being overly loyal. An example here in town is a number of years ago Hard Rock and The Palms were the places to be for the social scene. As you see with night clubs, what’s hot today is not hot two or three years from now so one of the areas we’re really looking at is how do you create loyalty among these retail customers and how do you transition them into loyal gaming customers? I know that’s one of the things we’re struggling with due to the lack of product that appeals to them on the casino floor.
You need to find the right mix. We try to do a better job at our properties here in Vegas of just keeping them on-site… making sure that everyone from the dealers to valet to the bellmen are selling the different assets that we have.
Casey Cohen, former vice president casino marketing, The Cosmopolitan of Las Vegas: What we saw at The Cosmopolitan was it was tougher to convert them to gaming than it was to get them to come back and spend money on the same things. They’ll spend money on a suite and they don’t necessarily want to earn their way to it by spending money on the tables. They want to do what they want to do. My first boss in this industry back in the 1990s said we do not control the customer’s wallet. We can only offer enough to them that we hope they spend it at our property, while making sure you get them back without stepping on other department’s toes, like casino marketing or retail.
Nick Ippolito, consultant: Gamblers gamble, and I don’t see the conversion opportunity, to be honest. They will go to the gift shop, the spa, they will tip, they will buy things. But it’s not the other way around. A gambler is a gambler; they’re born with the psychology. Sometimes they have a lot of money, sometimes they have no money, but they start out as gamblers and stay that way. I don’t believe you can convert the Expedia people and the retail people.
John Fernandez, vice president player development, Downstream Casino Resort: I worked in Tahoe for 10 years and we always tried to figure out how do you turn a skier into a gambler because, in the winter, that’s what we had, the ski business. That wasn’t the way to do it; we needed to take a gambler and teach him how to ski. I would go to Vegas and tell some big players that we had a guy who coached the U.S. ski team for 10 years and he’s going to teach you and your family how to ski, and all of a sudden we had a lot of business. We were turning gamblers into skiers and they loved it.