PUBLISHER ’ S LETTER
Incrementally
Yours
BY ROGER GROS
A GLOBAL GAMING BUSINESS PUBLICATION 2017
Roger Gros , Publisher rgros @ ggbmagazine . com
Frank Legato , Editor-in-Chief flegato @ ggbmagazine . com
Marjorie Preston , Editor
Robert Rossiello , Art Director rross @ casinoconnection . com
Unless you work at an integrated resort on the Las Vegas Strip , where more than 65 percent of revenue is generated by non-gaming amenities , you ’ re devoted to the casino floor . In most other jurisdictions , including the “ locals ” casinos of Vegas , gaming revenue accounts for at least 70 percent of total revenue , up to as much as 95 percent .
It ’ s no surprise that many casinos are slow to grasp the importance of non-gaming revenue and the capital reinvestment it requires . When most of your revenue is a result of gaming activity , why upset the apple cart ? And how much “ incremental ” revenue will these costly non-gaming attractions bring in anyway ? Your current customers provide great action , and you take good care of them . Why try to draw people who may not gamble — or not as much — and may get in the way of your best players ? Good questions . And the answers can sometimes be down in the weeds . The definition of incremental revenue is a slippery thing . It can mean a very small portion that will add pennies on the dollar . It can also mean revenue you don ’ t now have , that you can build on and increase over time with a sincere commitment to the concept .
Non-gaming attractions are already part of all casino operations , no matter how gamingcentric . All casinos need restaurants . If a hotel is involved , you ’ ve got a pool , sometimes a spa , a gym and maybe a small number of meeting rooms . You ’ ll need a gift shop to sell your logo merchandise and other high-margin items . And in most cases , you need entertainment , whether it ’ s a lounge with a torch singer or a showroom with star attractions .
In fact , a casino is often a collection of different businesses under one roof . So if you ’ re in the hotel business , why not make the best you can ? And we all know repeat customers are the rule at great restaurants . How about more than a gift shop ? Quirky and unusual stores are sometimes big hits in a casino . And of course meeting and conventions can be a very lucrative business if you get the right mix of groups and excellent execution .
I know players are our lifeblood , and if they want a comped room or meal , that will eat into profitability . But that ’ s where revenue management comes in . If you ’ re getting your profit on the casino floor , you can afford to give up something in hotel or food and beverage . But there ’ s another element to this equation as well — increased competition . You ’ ve got to protect your territory , and what happens if existing or new competition adds the elements you ’ re missing ? Full suites instead of just rooms ? A noodle house for your Asian customers ? Or an outlet mall connected to the property ? You could lose loyal customers , no matter how well they ’ re treated , if there are more reasons to visit your competition . So be proactive . Don ’ t let your competition get the jump on you . Your property needs to be the leader in the market , not the follower .
You stand to lose your loyal customers no matter how well they are treated because there are more reasons to visit your competition . The only answer is to be proactive . Don ’ t let your competition get the jump on you . Your property needs to be the leader in the market , not the follower .
The biggest argument for non-gaming amenities is to protect your market . If you ’ re truly treating your players right , they ’ ll sample the competition and then return to the place that makes them feel special .
Don ’ t let complacency rule . Take the lead and control the market .
— Roger Gros
John Buyachek , Director of Sales & Marketing jbchek @ ggbmagazine . com
Floyd Sembler , Business Development Manager fsembler @ ggbmagazine . com
Becky Kingman-Gros , Chief Operating Officer bkingros @ ggbmagazine . com
CONTRIBUTING EDITORS Dike Bacon • Dave Bontempo • Ed Healy Pamela D . Jones • Marjorie Preston • Aaron Stanley Erica Sweeney • Patrick Roberts • William Sokolic
EDITORIAL ADVISORY BOARD Rino Armeni , President , Armeni Enterprises
• Mark A . Birtha , Senior Vice President & General Manager , Hard Rock International
• Julie Brinkerhoff-Jacobs , President Lifescapes International
• Nicholas Casiello Jr ., Shareholder Fox Rothschild
• Jeffrey Compton , Publisher , CDC E-Reports
• Geoff Freeman , President & CEO , American Gaming Association
• Dean Macomber , President , Macomber International , Inc .
• Stephen Martino , Vice President & Chief Compliance Officer , MGM Resorts International
• Jim Rafferty , President , Rafferty & Associates
• Thomas Reilly , Vice President Systems Sales , Scientific Games
• Steven M . Rittvo , Chairman Emeritus The Innovation Group
• Katherine Spilde , Executive Director , Sycuan Gaming Institute , San Diego State University
• Ernie Stevens , Jr . Chairman , National Indian Gaming Association
• Roy Student , President , Applied Management Strategies
• David D . Waddell , Partner , Regulatory Management Counselors PC
Casino Connection International LLC . 901 American Pacific Dr , Suite 180 , Henderson , NV 89014 702-248-1565 • 702-248-1567 ( fax ) www . ggbmagazine . com
The views and opinions expressed by the writers and columnists of Casino Style are not necessarily the views of the publisher or editor .
Copyright 2017 Global Gaming Business LLC ., Henderson , NV 89014
Casino Style is published annually by Casino Connection International , LLC . Printed in Nevada , USA .
4 l CASINO STYLE 2017
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