With Mississippi gaming issues at the heart of his presentation, Gary Loveman, president and CEO of Caesars Entertainment, used his keynote address Wednesday at the Southern Gaming Summit in Biloxi to address problems – both current and in the future – of gaming in the United States.
In his address – “Did Dinosaurs know they were Dinosaurs” – Loveman said the model that lifted the casino industry to its place in American society could end up being the model that brings it down.
Mississippi was once the second-largest gaming area in the country, but the recession of 2008 and an increase of competition as more states legalize gaming has contributed to a downturn in gross gaming revenues. Mississippi River floods in 2011 and Hurricane Katrina left their marks on the industry in the state.
But Mississippi is not alone. Atlantic City is in even worse shape, with revenues dropping 36 percent from its peak in 2007.
“Building more casinos strikes me as a very bad idea,” said Loveman, who was the driving force behind Caesars worldwide expansion since 1998. “The model now is very different.
“We have to face the fact that we’re in a different situation.”
Loveman proposed a three-step plan to stabilize the industry.
First, instead of building more casinos in the destination and rural areas, bring bare-bones casinos into major urban areas, and develop business partners around it.
As an example, he cited Harrah’s casino in downtown New Orleans. The casino opened with just gaming and a small buffet. With little else, it depended on its downtown-area partners to grow.
He noted that other cities such as Detroit, Cleveland and Cincinnati are following a similar strategy. The larger casinos can then use their new-found databases to develop customers for sister properties on the coast.
“Destination markets need new customers,” said Loveman.
Second, since destinations need new customers, increase the hospitality experiences at the locations, Loveman said.
He noted that the Las Vegas visitor is changing. While the total revenues have increased since 1991, the gaming dollars are flat. Dollars spent on spas, shows and lodging have seen big increases.
Loveman cited amenities such as entertainers, celebrity chefs, nightlife, shops, hotels and golf as things that attract visitors.
“We don’t have enough people coming to the Gulf Coast,” Loveman said. “We have to give them reasons and make it easier for them to get here.”
Loveman pointed out that the trip-planning online sites such as Expedia and Kayak are driving forces in where out-of-state visitors go, and Coast casinos have to find a way to get people here.
Third, Loveman addressed the “Multi-Channel Engagement,” which includes all aspect of the internet and social media, not just online gaming.
“Casinos can not be a single-channel institution – or we will become dinosaurs. We have to offer our goods online,” he said.
He was referring to more than online gaming. His company has refocused its website to stress amenities. It also is embracing social media and the interent. “We need to be able to provide all our services online.”
Caesars Entertainments owns the Horseshoe, Harrah’s and Roadhouse in Tunica and the Grand in Biloxi.
BEFORE YOU GO…
… we’d like to ask for your support. More people are reading the Mississippi Business Journal than ever before, but advertising revenues for all conventional media are falling fast. Unlike many, we do not use a pay wall, because we want to continue providing Mississippi’s most comprehensive business news each and every day. But that takes time, money and hard work. We do it because it is important to us … and equally important to you, if you value the flow of trustworthy news and information which have always kept America strong and free for more than 200 years.
If those who read our content will help fund it, we can continue to bring you the very best in news and information. Please consider joining us as a valued member, or if you prefer, make a one-time contribution.Click for more info