Fewer people have been risking less money in casinos from Las Vegas to Atlantic City over the last 12-18 months. Many of them are spending money closer to home in new regional casinos that have more bells and whistles than ever.
That’s not exactly news, but does this single slice of reality tell the entire story about where money is being spent or not spent? Has the impact of non-casino spending taken some of the sting out of lower casino winnings? The revenue equations that determine success or failure are increasingly driven or shaped by factors that did not exist years ago.
When the former Caesars Palace owners built the 4,000-seat theater it was with the understanding that the theater’s outside operators would retain ticket revenue and Caesars would benefit from what was spent in restaurants and the casino by people attending Elton John or Celine Dion shows.
It was an approach that appeared to work nicely, just as it did at the Forum Shops. Shifting consumer preferences is getting close looks from senior gaming resort officials across the country.
The fact is, the top casinos in most markets – Las Vegas, Atlantic
City and regional destinations – enjoy their lofty status because of the total experience they offer.
But as Steve Wynn was recently saying, "Entertainment isn’t what it used to be. The traditional approach to entertainment (big showroom productions or big name stars) is not the moving factor in this city anymore …
"The things that are moving this town now are food and beverage, hotel accommodations and service," Wynn says. "The public is getting very sophisticated. Rather than watch a show, they want to be part of it."
Maybe that will help explain the $700 million a year in nightclub revenue that has appeared in this city. Maybe it is $800 million since the new millennium.
"It’s an entirely new phenomenon in every city in America and, I might add, every city in Europe . . . The people who go out at night want to whoop it up as opposed to sitting in a chair watching someone else whoop it up."
Wynn adds, "The late shows in Las Vegas have been impacted by the nightclub scene. Las Vegas at the moment is the center of the nightclub universe."
Yes, times have changed. "Gotta be agile," is what Wynn seems to say.
Question? Comment? E-mail me at: Phil Hevener