Split-level in Vegas Seven

It’s Thursday, which means another Green Felt Journal column in Vegas Seven. Here’s the crux of what I call the “split-level strategy”:

So casinos are pursuing a “split-level” strategy that harks back to the 1970s and earlier—keeping prices low for bargain hunters while pursuing high-end play at the baccarat tables. It’s not the mid-1980s approach of making a profit on the sheer margin of visitors, since it’s much more expensive to borrow, build and maintain casinos today. And it’s not the early-2000s pursuit of free-spending travelers willing to pay a premium for rooms, food and entertainment. It’s looking like a little bit of both, taken to extremes.

via Adopting the old ‘split-level’ strategy | Vegas Seven.

I talked about this strategy last week, in some detail, but I wrote this article first, so you actually read my response to what I wrote before I wrote it, if that makes sense. Not quite the grandfather paradox, but it does muddle the timeline a bit.

This is also, by the way, what I was referencing when I talked to the LVRJ about the Hard Rock’s plans to chase the Asian-American middle-upper-level roller. It is a huge potential market, but basing your strategy on targeting local players of any ethnicity is risky right now, because of obvious reverses in both employment and housing.

Having looked over the numbers even more closely over the past week, I’m even more convinced that without the high rollers spiking the baccarat numbers, we’d be telling a very different story about 2009. Hopefully I’ll get to that later today.

I went with “split-level strategy” because it sounds retro and the strategy is very, very retro. As I said, it’s totally different from what worked in the 1980s and the early 2000s, and it is risky, but given the economic climate right now, there are few other options.

2 Responses to 'Split-level in Vegas Seven'

  1. FoolsGold says:

    Split-level strategy. Sounds fine.
    Markets are segmented and some casinos have identifiable niches, but in general its a “take care of your customer, be he a low roller or a high roller” strategy.
    I think there was a real dark cloud that had everyone worried and forced a bit of a shakeout in the market place. Some casinos had very high debt and some casinos had grown less than friendly to their customers.
    Now renewed efforts and a renewed focus on quality seems to be working. That recent tweet about “ridiculously long line at the buffet for a Tuesday, has to be good news for the economy” may just show that the turnaround is coming. Casinos that provide quality and attention to detail will prosper, be it from low rollers or high rollers. I just wonder how vulnerable each of these market segments is to economic adversity or simply changed alternatives.

  2. Erik2020 says:

    This is a good article for a good, new, free magazine.

    A friend took me to the House of Blues at Mandalay Bay for Valentine’s Day. The gift shop there has a rack that provides free copies of this nice looking and modern free mag (Vegas Seven).

    I really like it. I didn’t realize it was free when I first heard it mentioned here.

    One thing I sort of don’t care for is that the paper for the pages seems a bit too thick. The pages don’t have ‘good flipability’.

    Otherwise…the graphics and its good collection of writers and interesting stories make it a great addition to Vegas news coverage.