Gaming officials concerned over falling Tunica casino revenues
by Frank Brown
Published: April 26,2013
When Gov. Phil Bryant signed a bill recently creating the Mississippi Gulf Coast Regional Convention and Visitors Bureau, John Hairston saw the occasion as more than a tourism bill for three coast counties.
For the chairman of the Mississippi Gaming Commission, it is both a step in reviving the Tunica County casino and a pre-emptive strike in keeping the coast a viable market.
“You bet it is (a pre-emptive strike),” Hairston said after last week’s monthly meeting of the Mississippi Gaming Commission in Jackson. “The whole purpose of HB 1716 was to create a table that has a lot of chairs. Those chairs are filled with stakeholder associations, laymen, professionals and tourism professionals who are trying to come up with a quantified goal and a way to execute the strategies.”
“Overall HB 1716, combines the strength of public transparency with private sector strategies to create a leadership organization that pulls us all together,” he said. “I hope that model is successful enough to export to the state as a whole and to Tunica in particular — I’m very concerned about Tunica.”
Gaming revenues have been dropping in Tunica County casinos since the spring floods of 2011. Mix that with more gaming venues nationwide, a sagging economy and competition from an Arkansas racetrack and many gaming officials are concerned about the future.
For example, revenue for the Mississippi River casinos dropped from $115.7 million in February 2012 to $99.1 million February 2013. February, a month when many people get their income tax returns, is usually one of biggest months of the year for casinos. January numbers were also down: $89.2 million in 2012 to $77.8 million this year. Numbers also were down — although not as drastic — on the coast in January and February.
“On the coast we have other amenities that are natural in nature,” said Hairston. “In Tunica, it’s not as robust. Tunica can be picked on easily, and that’s what happened. You have an organization in Arkansas that is using, in my opinion, offensive methods.”
Hairston was referring to a marketing campaign in the Arkansas, Tennessee, north Mississippi area in which Southland Park Gaming and Racing of West Memphis, Ark., incorporates negative Mississippi stereotypes in its attack ads. The television ads advise viewers “Don’t Risk the Road Trip.” They depict dangers such as a traveler being chased by a chainsaw killer after suffering a flat tire, and a traveler being assaulted by inmates after being tossed in jail for speeding on Mississippi roads.
“From politics we know negative advertising works, so now we have a beginning of an advertising war that is probably unproductive for both markets,” he said.
Hairston said he believes new Tunica ads are going to show a contrast and maybe call out the racetrack.
“People consider Tunica as having a lot of different properties all there together, and that is still unique because many of the areas that we now share guest they might be standalone properties,” said Theodore A. Bogich, senior vice president of operations with Boyd Gaming at Sam’s Town Hotel and Gaming Hall in Tunica, who was approved in a suitability hearing during the meeting.
“An example would be the racetrack. It’s a standalone property and doesn’t offer the amenities and experience we do in Tunica. I think that having the different properties in Tunica working together important to figure out how to leverage what we have and keep fighting those battles.”
Lee Dillard, regional vice president for Caesar’s properties in Biloxi (Harrah’s, Grand Casino, Tunica Roadhouse and Horseshoe), added a different perspective during his suitability hearing in which he was approved.
“We’re not seeing a significant decline in hotel occupancy,” he said. “What we’re seeing is a decline in convenience play that’s going to a competitor in Arkansas.
“You’ve probably seen or heard about the commercials they’ve done that are very aggressive and successful. Collectively as a market, were working together to attack that.
“Market studies show the Tunica Market is a good as a place to come for a weekend, it’s the convenience player who is going elsewhere.”
Vincent Schwartz Sr., who was approved in his suitability hearing as vice president and general manager at IP Casino Resort & Spa in Biloxi, another Boyd Gaming property, offered his thoughts on how to keep similar woes from falling on the Gulf Coast.
“We all know Biloxi has been market-flat for a number of years,” he said. “The opportunity we have is to use the Boyd database to drive some business in here. Since there doesn’t seem to be a natural draw for them, other that what we already have, we need to expose new people to Biloxi that we have an opportunity to bring in from other properties. We’ve been doing that but we haven’t been as successful as we want to be — but they’re making their way here.”
In a promotion to draw area players back to Tunica, Caesar’s started its Millionaire Maker promotion this month. Harrah’s, Tunica Roadhouse and Horseshoe are giving away $1 million to a single player every Saturday night. The first winner was from Little Rock, Ark., and the next winner was a retired teacher from Senatobia.
But the bottom line is simple to Hairston: “I’m just worried about the thousands of people in Tunica who may lose their job if gaming revenues continue to drop.”
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