Las Vegas is going to look very different in only a couple of years, and the definition of what counts as a full weekend in my adopted hometown is already changing fast. Casinos in town already know they must get ready for the Vegas of 2020, but in reality they’ve been in transformation mode the past few years to keep up with the evolution of the gaming industry.
Get your copy of Duetto’s new Vegas 2020 report for a roadmap to the future of Las Vegas and to the casino Revenue Strategy that ensures you take your share of the market.
This city of course has always been known for gaming. Yet since the Great Recession, when I was leading revenue management and analytics at Wynn and Encore Las Vegas, gambling spend has not been growing nearly as much as other forms of entertainment.
Finally, after years of groundwork preparing Vegas to reach its potential, it’s becoming a full-blown sports town. The Golden Knights had a Cinderella season in their first year in the National Hockey League, and the Aces nearly made the WNBA playoffs in their first year. Both teams play at arenas on The Strip. By 2020, the Raiders will be the first National Football League franchise in Las Vegas, and they’ll play in a $1.9 billion stadium.
That doesn’t mean casinos are done building on The Strip.
By 2020, there will be three huge casino-resorts opening on The Strip, including The Drew, Resorts World, and Wynn Paradise Park. That means an expansion of 9,000 hotel rooms on The Strip.
The Las Vegas Convention Center is taking on a billion-dollar expansion of its own. Imagine the demand that would come if Vegas lured another trade show the size of CES every year. It could happen.
So, the big question is, will the influx of sports fans and e-sports players — not to mention millennials and other young visitors looking for something other than slot machines and table games — create the demand needed to absorb the new supply? Those are hard questions to answer.
There is some precedent for casinos diversifying into a strategy for growing non-gaming revenue. Forward-looking companies like MGM long ago saw the value in thinking of themselves as entertainment companies rather than just gaming companies. They’ve also worked hard to incorporate non-gaming spending into their pricing and reinvestment strategy.
But there are so many variables at play in a market and an industry as mature as Las Vegas and gaming.
If history can serve as a guide here, I think Las Vegas will thrive with all this change. The very casino Revenue Strategy that started it all for Duetto was developed on The Strip during the worst downturn anybody can remember. Trying to open Encore Las Vegas in 2008 was like trying to open a Dairy Queen in Antarctica.
But ever since, the strategies we deployed then have led our partner casinos and hotels to sustainable success. I’m optimistic about Vegas’ future in 2020 and beyond, and it’s based on much more than a lucky feeling.
Duetto will be out in full force at G2E 2018 next week. Visit us at Booth #4000, or check out https://www.duettocloud.com/g2e-2018 to catch our panel presentation and networking reception during the conference.