Difficult times mean difficult decisions, and unity is essential
For more than three decades, the commercial casino industry has enjoyed a predominantly steady and successful course of growth and expansion throughout the United States. Through innovation and with agility, our industry has adopted new gaming technologies, created more diverse entertainment offerings and overall greatly enhanced the customer experience. Even in tough economic times, when other industries have experienced significant challenges, our industry has remained relatively stable.
This growth and development often has continued in spite of numerous challenges the industry has been confronted with. Whether dealing with vocal opposition in new jurisdictions or recovering from natural disasters such as Hurricane Katrina, our industry has persevered and, in fact, grown stronger after facing down these tests.
Today, our industry is faced with a challenge the likes of which we have not seen before. The current economic instability the U.S. is experiencing is affecting businesses of all stripes. In the past, some have used the term “recession-proof” to describe the commercial casino industry. This characterization always has tended to exaggerate our industry’s general stability during tougher economic times, and it is clearer now more than ever that the idea that our industry is immune to economic downturns is simply an old wives’ tale.
We are a consumer-driven industry. It therefore comes as no surprise to those of us within the industry, or those who follow our industry, that we are impacted by the current economic situation just as any other consumer-driven businesses would be, particularly those in the hospitality sector. I know we all are well aware of the impact of our customers taking shorter trips for fewer days, and of cutbacks in airline service that are making those trips even less likely. And, as more and more casinos have incorporated unique retail and dining offerings, we also have been affected by people spending less on luxury items and on eating out at nice restaurants.
As you know, another economic factor currently affecting the industry is the tightening of capital markets. Depending on which segment of the industry you work in, you may already have seen firsthand how the drying up of financing for development projects is forcing companies in our industry to rethink the timetables for some projects, both those already under way and those not yet begun.
The economic challenges facing the industry are serious, and while the economic picture looks different from state to state, our industry as a whole certainly has felt the impact of these challenges on our businesses.
The current economic situation, including the challenges it presents and how the industry can address those challenges, will be a prominent topic of discussion later this month at Global Gaming Expo in Las Vegas. G2E always has been the place where professionals from our industry come together to share the new ideas, innovations and best practices that will advance the field of gaming entertainment. This year, G2E will once again provide an important forum for our industry, with industry leaders and gaming professionals from around the world converging on Las Vegas to examine the complicated economic environment in which we find ourselves and discuss how best to navigate it.
The opening keynote address at G2E 2008 will serve as a launching point for this important discussion as Ron Insana, an accomplished financial expert and former CNBC contributor, provides his perspective on today’s top financial issues and their influence on the gaming industry. In addition to his past position as a regular contributor on CNBC, Insana has written for USA Today and Money magazine, hosted a nationally syndicated radio show, and authored three books about Wall Street. There is no doubt his considerable expertise in the financial world will be of great value to our examination of the industry’s economic health.
The following day, I will moderate G2E’s State of the Industry keynote, which this year will focus on the theme “Evolution of Global Gaming.” During this event, our panel of industry leaders will discuss the key issues currently affecting the industry, including how we can use today’s challenging economic climate as a springboard for future growth and innovation. For those of you planning to attend G2E, this session is not to be missed.
In addition to these important opportunities for learning and discussion, most of the conference tracks at G2E 2008 will incorporate at least one session examining how the current economic situation is affecting that particular sector, and how to best plan for the future. Whether you are in F&B or security, table games or corporate social responsibility, you will hear from experts in your field about mitigating the negative effects of the financial climate and developing successful strategies for your business.
At this time in our industry’s history, there is a quote, attributed to the ancient Roman philosopher and poet Horace, that I think is particularly appropriate: “Adversity has the effect of eliciting talents, which in prosperous circumstances would have lain dormant.”
Ingenuity and innovation have long been part of the legacy of the commercial casino industry, and they are traits that often have helped us overcome past challenges. And while these traits certainly have not been “dormant,” it is in challenging times such as these that they serve us best. We cannot predict what the future will hold, but we can consider this difficult time an opportunity to closely examine our businesses and use the ingenuity and innovation that have served us so well in the past to make the improvements and adjustments that will help us better weather this type of storm in the years to come.