Last month, I was on the Las Vegas Strip and had dinner at one of the high-end casinos in one of its fine-dining restaurants. And I have to say, I was blown away. Easily one of the five best meals I’ve ever had in my life. Lots of different kinds of meat, seafood and vegetables, all cooked to perfection with unbelievable flavor. A very nice bottle of pinot noir chosen by the sommelier. And the best part? Since I was dining with the property president, I didn’t have to pay.
And thank goodness I didn’t. While I wasn’t being nosy, I caught a glimpse of a bill that approached $400 (for two). As good as that meal was, as skillfully prepared, and served with superior knowledge and care, I wouldn’t pay that much for any meal. I just don’t have that kind of disposable income, and I don’t think I’m alone in that.
Pricing has become quite an issue in the casino business. We’ve been hearing the drumbeat of “non-gaming revenue” for so many years, I think we’re becoming immune to the prices people are willing to pay for our food, beverage, entertainment, and yes, even our games.
A few weeks earlier, at the other end of the Strip, I was sitting at a bar at one of the lower-end casinos. I ordered a mixed well drink and my wife had a glass of the house red. The bill came to $35. Now, I wasn’t sitting in the Umbrella Bar at Wynn or even the center bar at the Hard Rock. This was a nondescript watering hole on the casino floor of one of the dormitory hotels that dot the Strip. This one doesn’t even have a nightclub, so you can understand it wasn’t the top of the line. So I was somewhat taken aback by the high price tag.
The same thing happens to me when I’m traveling to casinos outside of Las Vegas. Very rarely am I able to find a place that features reasonably priced food and drinks, combined with a good gaming experience.
With people gambling less these days across the board, are we chasing them out of our buildings by making them pay double what they might pay in their neighborhood bar? People certainly expect to pay more in a casino, but double? We need to think about that.
Now, I understand that some casinos can get away with high prices. I went to see the new revue ShowStoppers at Wynn Las Vegas last month. Steve was very proud about envisioning and inspiring the great performances that make this show so special. It’s truly a unique show and well worth the $150 for the better seats (tickets start at $100). People who go to Wynn expect to pay top dollar, but they expect a lot for it, and generally get it.
But other casinos are less sure of who and what they are. And the only way you can be sure is to analyze your market and who you can reasonably expect to attract. Remember, price points can be competitive advantages. Great food at reasonable prices, extended happy hours, discount entertainment tickets for your marginal customers… all these things can set you apart from your competition.
And if you’ve read Editor Frank Legato’s story about slot hold percentages and the gambling experience on page 18, you already know that there is a great debate about how much you can return to the player on the casino floor. Myself? I fall into the category of giving the player as much as you can, combining it with great service, reasonable prices for non-gaming amenities, and an understanding that loyalty is earned, not automatically granted.
In the end, you have to decide how to use price points. Are you going to grab as much revenue for the longest amount of time, or are you going to offer your customers the best price on everything you have to offer, gaming or non-gaming? Is the quality of service and knowledge worth the premium you’re placing on products?
This is one of those issues that is particular to each individual property, even if your parent company is a multinational gaming conglomerate. Each market is different and each and every decision is critical.