Two Way Hard Three | Las Vegas Casino & Design Blog

Posted by mike_ch

Welcome!

I think it's fair to say in NYC that gambling can't be the main draw to Vegas, since if you just wanted gambling you could take a trip to Atlantic City instead.

I'm not sure what you actually proposed solves the problem of Vegas kitsch (nor am I convinced it's actually a problem), but they're good points anyhow. I would say Vegas has been actually propositioning itself as a value, but it's only half-way true because of the sheer size of the resort fees (seriously, $25?!) The industry needs to cut the shell game on this, the government began regulating the airline industry into showing all fees and taxes in it's base price, and the hotel industry should show a little concern that the same thing might happen to them. Maybe the Vegas hoteliers feel that Harry Reid will protect them from this, who knows.

The smartphone thing, eh. I would think it would be neat to be able to know where a machine of a certain game/theme/denomination exists in a casino and have a map to that on my phone, but when I'm in a property I use all the same apps on my phone that I do when I'm at home. Twitter, the news, occasionally Maps, that sort of thing.

Thanks for the welcome, Mike. I don't think Vegas kitsch is a problem... it's one of the things I love about the town. But it is something I've heard others mention in an unflattering way. I think it's just a perception problem. What one person sees as kitsch another sees as tackiness, I suppose.
I brought up technology/smart phones mainly because I think it's one of the biggest areas of opportunity in the business. If you haven't yet, check out the interview that the Vegas Gang did with the two guys from Bally's from a couple of weeks back. They definitely touched on some of the topics I've been thinking about in regards to this. Tech in many casino properties feels like it is from the stone age. I don't think a younger generation of leaders would stand for it- in fact, I would go as far as to say it could keep younger people from pursuing a career in the gaming biz.

Posted by BillyInLasVegas

I couldn't agree more!

Right now you can send a text to check out at almost all strip properties but a cool app would be better. Honestly I rarely even check out anywhere, I usually just leave.

But if I can order and pay for a burrito with my iPhone why can't I do the same with my hotel room? You would think the high end places would at least have some cutting edge apps but it's not the case.

At least the Bally's guys seem to be working on it and hopefully other companies are working on this as well.

Is it still even possible to become a new titan in Vegas? The larger properties have corporate structures which typically won't tolerate too much individualism. I can't see a young turk rising through the ranks of Caesars or MGM to become a celebrity casino magnate. Anyone at Wynn or Sands is blocked by the existing potentates. Further, the cost of entry to build a new property is still prohibitive. A new titan would need to buy an existing downtrodden property and turn it around. What about the owners of the gold spike and rumor, golden gate and Fitz, or lady luck? Marnell, Maloof, Poster and Breitling are all still young enough to turn things around at different properties.

Thanks for the writing, Paolo, and thanks for featuring it, Hunter. Your tweet about the interview with Alex Epstein was right on, interesting timing on that one. She has great potential to help East Fremont and the surrounding blocks transform into something that could really appeal to the next generation of Vegas devotees. The issues you raise really make one wonder if a young visionary could ever garner enough momentum to change anything significantly among the Strip properties. Young Yeminidjian (can't remember his first name offhand) doesn't seem a likely candidate and the price of entry seems out of reach for basically anyone.

I agree, parchedearth. Those dudes each have many good years ahead of them. I see what you mean about the Caesars and the MGMs of the world stifling individuality and risk-taking. But we have seen a bit of the consolidation of the last decade being reversed- like Ruffin taking over the TI. If this continues, the chances of fresh talent rising up will increase. I think we can all agree that when we have more independent operators and more competition, we as consumers will benefit.
I'm definitely watching Steve Siegel and The Siegel Group with much interest. I'm glad you mentioned them.

Posted by Hunter

Who knows - not impossible to imagine a newly minted tech millionaire deciding they want to get into the casino biz, either for fun or because they think they can revolutionize it.

It's ripe for disruption.

New York City (as a DMA) is in the top 5 for my readers/visitors. Hence, I don't believe we are hurting for visitors from the Big Apple. Keep in mind that Paolo may have a group of friends who are simply not "Vegas" types and nothing in the world is going to attract them here.

Look at the "wild success" Cosmo has had catering to that crowd. People who are living on their smart phones are so wrapped up in the phone that they aren't gambling.

Las Vegas draws well from California, The Midwest and a growing international audience who love it. 19% of visitors in 2011 were first-time visitors and Las Vegas has an unusually high "re-visit" rate so we know that many of them will be back.

I guess my question is simply Why go out of your way to market to people who aren't Vegas-type people? It seems like a lot of effort in return for marginal ROI. CityCenter was supposed to attract that group. Ooops.

I'd like to add, that a young visionary/leader doesn't necessarily have to own a property. One could make a significant impact as a manager, anywhere in the pecking order; they just need the support of the rest of the organization as well as the freedom to take risks.

Nice article. I pretty much agree with everything stated in it, but I immediately thought that you'd overlooked the contributions of Alex Epstein and the Fifth Street Gaming crew.

Alex has been a game-changer for El Cortez and she has for years pushed new ideas and ventures Downtown. She's also a total babe. Then, I checked Twitter and you'd posted an article about her. The Fifth Street Gaming organization seems to not only be listening to their customers, but also to be taking the initiative to look for new markets and revenue streams that have gone overlooked by the big boys.

I wish all of the 'Titans' well, but I just can't like the Fertitas. With the amount of people they laid-off before taking a pay-decrease and the hubris with which they waved their father's money around, it's just nauseating to see them still around town because of a bait-and-switch approach to financing and bankruptcy law.

@Ted Thanks for reading and thanks for your thoughts.
You are absolutely right that my circle of friends aren't "Vegas" types. But I would say that they are a kind of "canary in the coal mine". I'm not saying they should be marketed towards because they will change their minds and come back in droves.
What has worked in the past likely won't work in the future. Cosmo and CityCenter's strategies were mostly brand and marketing driven; operationally, they haven't been quite that innovative.
The world has changed too much. Best not to rest on laurels and assume that people will always go to Vegas. There's too much at stake.

Very nice start. In my opinion as a later 30's person, Vegas is always going to have a bit of a perception problem, especially on the East coast, from what I've seen in my 10-15 year affair with the city, is that it has peaks and valleys in relation to how it plays across the country and typically is due to the way it reinvents itself.

I'll fully agree with you on options are needed to bring technology closer with the current generation and the hotels. I'm still fascinated that although I've stayed in 15-20 resorts on the strip, only 1 has offered me the option of text check in and check out (Caesars). (They handle it fantastically as well).

I don't think we are going to see a lot of incorporation of technology though from these resorts. Their history shows us they are 'legacy' corporations that maybe able to polish the current model in a new way at times, but they run into severe problems when they try to innovate. As large corporations (in many cases), it's just not easy to implement new technology across the board or to change a business direction. There is a cultural and behavioral hurdle that businesses are still working over in trying to adapt at these levels and in my opinion it's going to be needed to be done on smaller scale first before the plan is something that the larger businesses decide to 'truly' adapt.

I first visited Vegas in the early 1980's when I was already in my 30's. This was before the time of clubs and over-the-top nightlife. As a Detroiter, Vegas appealed to me because it offered a fantasy world of faux luxury I did not experience at home. I was loyal to the same properties and seldom strayed to others except to sight see. The combination of a casino, nice rooms and/or suites as well as, at the time, "gourmet room" dining was all I wanted. My property loyalty enhanced my experience due to increased comps. Yes, I know, nothing is free in Vegas, but they were fun times.

I started at the Las Vegas Hilton which at the time, along with Caesars, were considered the premiere properties in town. Thirty years ago, The Hilton and Caesars didn't seem like corporate operations. They hadn't yet lost the "old Vegas" spirit and independence. As years went by, I migrated to the then new MGM Grand, Steve Wynn's The Mirage, then Bellagio and finally, Wynn Las Vegas. MGM Grand may have been built somewhat on the cheap, in my opinion, but when it opened in 1993, it ran as a great Kerkorian place with excellent casino promotions, tournaments and parties.

Back to my original thought, Vegas was a fantasy world that didn't exist at home, and in those days, casinos weren't ubiquitous.

A UNLV student wrote a thesis in 2010 on target markets Vegas should focus on. Two years ago, the author probably didn't realize how fundamentally Vegas would be changed. I found a lot lacking in his thesis (along with unacceptable spelling errors), but he suggested that Vegas should concentrate on Baby Boomers who will be spending for the next 20 years. Although I missed being born in the baby boomer years, I certainly relate to them more than younger generations. Here is his report: http://digitalcommons.library.unlv.edu/cgi/viewcontent.cgi?article=1595&context=thesesdissertations

I don't believe we will see a new generation of gaming industry leaders like Kerkorian and Wynn. The business today does not attract entrepreneurial leaders; it attracts corporations who can operate groups of entertainment components like hotels, restaurants, clubs and, oh, by the way, casinos. Cosmopolitan may be a good example of a property which was envisioned as an independent hotel casino that a young titan might build, but the developers didn't have deep enough pockets. Even now, Deutsche Bank is struggling and realizes hotel rooms and hot restaurants/clubs can't pay all the bills. If the casino doesn't turn around by the second anniversary, coming up soon, I think DB will sell it to MGM. Even though CityCenter isn't a great success, Cosmopolitan could probably do better under MGM's corporate umbrella along with all its other Strip properties.

I've never considered Sheldon Adelson a gaming industry leader. He's a smart business person who sold Comdex to the Japanese at the right time and focused on the convention/meeting business and was also smart enough to see the potential in Macau and Singapore.

I don't believe real innovators are looking at the hotel/casino industry. They're more interested in technology and ideas, not brick and mortar industries.

Like it or not, the fortunes of Las Vegas are in the hands of corporate giants like MGM Resorts and Caesars Entertainment. I'd sure like some "Young Titans" to surface and prove me wrong.

Finally, although I'm not as tech savvy as all of you are, it amazes me that Strip operators don't realize how important convenient technology is to visitors in all age groups.

@detroit1051 "I don't believe real innovators are looking at the hotel/casino industry. They're more interested in technology and ideas..."
Unfortunately, I think you are right about this. The gaming industry is certainly dominated by the big boys, but that doesn't mean a scrappy little independent boutique can't pop up somewhere. Let's keep our fingers crossed.

Vegas is kitsch. So is Disney, both are wildly successful. The one thing I've been watching get completely out of control over the past 10 years, however, is the hustle in Vegas. Every time you turn a corner there is some schmuck acting like you owe him money. They don't even pretend to offer service for a tip anymore. The "you owe me" attitude runs rampant from dealers, to cab drivers, and is now all over the place with Batman, and the frakking toy story characters littering the strip. Now there are legions of dudes in suits trying to send you to sapphires. I mean a whole army of them. I was asked 6 times in 15 seconds (no kidding, we counted) this weekend and all of it for one club. I swear we need a spam filter just to walk down the strip.

Vegas still has value but something must be done about the hustle. At some point, people who are good tippers like myself start to see everything as BS and we don't tip so well anymore. This will only serve as an obstacle in recruiting people that want to provide excellent service.

I agree that the lack of tech will continue to be a problem for Vegas. The traditional visitor (Gen X and older) wanted to get away from computers and phones because they were traditionally used for work. The millennials have been using computers and phones for social and fun for all their lives and don't want to deal with people over the small stuff. I'm too old to be a millennial, but I tend to think the same way (and the old folks are starting to come around). When I get to a hotel and see $10+ per day on WiFi it pisses me off. Then I see the the comp system that requires me to fill out a paper form and hand it to someone who keys the same information into a system that already has all my info from booking the room and I get a little more frustrated.

99% of the comp tracking could be done with smartphones and QR codes. You sit down at a machine, scan the code and start gambling. When you sit at the table scan the code on the felt and go. check your points balance with an app or webpage. When it's time to eat, there's a QR code on the cash register. I could even see an end to the stupid room keys that don't work with a QR and/or NFC sensor tied to a back end system.

@ ReadyKilowatt I think you have the right idea. And the most important part, at least from an operational standpoint, is that these measures would end up saving a lot of money for the company over time. It's a win/win situation.

I think one part of the resistance against too much reliance on smartphone technology (such as using QR codes instead of club cards) is the possibility of cheating. Casinos already tell you to put away your phone -smartphone or not - when at the tables, so I think the last thing they want to do is encourage its use in gaming situations.

However, I do think that more integrated tech in Vegas is inevitable...my generation lives and dies on social media and ubiquitous internet access. Its no longer a luxury add-on - its essential. So smarter tech integration is def going to be key.

Tilman Fertitta's Landry's is buying Isle Biloxi for $45 Million. Based on their plans, they'll turn a mediocre property into a first class competitor to Beau Rivage. I don't think Isle Biloxi ever recovered from Hurricane Katrina, and ISLE didn't have the vision (and money?) to re-imagine the property.

Is Tilman Fertitta one of the new Young Titans? Vegas, Laughlin, AC and now Biloxi plus all of Landry's other restaurants.

http://www.sys-con.com/node/2191006