This is been a whirlwind Vegas News week. There was at least one different casino operator reporting quarterly earnings every day.
The information can be quite dizzying even if you’re not tracking the revenue numbers. All the money talk is probably more mind-numbing but that’s for someone else to deal with. I listen to earnings calls because they often have information that’s not in press releases and spreadsheets. There are usually Vegas News nuggets or more details on information about topics glossed over in the reports. MGM Resorts International is probably the best example of this.
MGM Resorts To Use Dynamic Pricing
During their earnings call, MGM Resorts slipped in a nugget that much of the media has decided not to report for some reason. They plan on using a dynamic pricing model in the casino, at bars and restaurants, and probably anywhere they can adjust prices with ease. According to Business Dictionary, “dynamic pricing is the process of determining a product’s value in commercial transactions in a fluid manner depending on current market conditions.”
Basically, businesses will lower and raise prices depending on when they’re busy. This isn’t a new concept in Las Vegas or anywhere else. Uber has “surge pricing” when a city or part of town is busy. They adjust their prices based on the number of drivers available. Tickets to sporting events come with a warning if they use a dynamic pricing model. Casino guests should already familiar with this concept. This pricing model allows businesses to charge more when there’s more demand. Hotels do this every day by adjusting prices based on occupancy. Casinos do this as well. A craps game might have a $10 minimum during weekdays but $15 when it’s busy at night or on the weekend.
Holiday Pricing is Dynamic Pricing – MGM Dynamic Pricing
The Cosmopolitan has been using “holiday pricing” for years. In fact, the first time I met Mr. TravelZork was during a holiday. The prices at Wicked Spoon that day were about $5 or $10 more than usual. Last year, I grabbed a drink in the sports book and the waitress told me that my glass of Macallan would be a few dollars more than usual because of holiday pricing. It was obnoxious that the waitress didn’t tell me until she handed me the drink.
It appears mystery pricing might happen at MGM properties too. MGM Resorts plans to charge more for restaurants, bars, and basically anything they can when their properties are busy. In fact, Vital Vegas says Excalibur Hotel Casino is already rolling out dynamic prices at their gift shop. MGM Resorts hasn’t made an official announcement of when the rest of their properties and venues will switch to dynamic pricing.
Bottom Line: MGM Resorts properties will be more expensive than others during holidays and busy conventions.
MGM Resorts COE’s
“Centers Of Excellence” (COE) was touched on during the earnings call but detailed in the MGM Resorts earnings presentation (page 16). This is part of the MGM 2020 plan to reduce expenses. This new team in the corporate office is part of the reason the company is laying off on-site supervisors and managers.
The COE will essentially take decision making out of the casinos and put it in the hands of 18 corporate officers. Decisions on bar and restaurant menus and prices, casino operations, and more will no longer be made by people that work at each property. This should save money for MGM Resorts. It could even create efficiency in decision making from the top down. This could also further homogenize their properties.
COE – Impact on Experience at MGM Resorts?
By switching to COE’s to make casino floor level decisions, MGM Resorts could take any unique touches from on-site employees out of the casino experiences. The people working inside the casinos have insights to customer preferences that nobody can learn from a corporate office. I’m curious to see how this affects the experience of visiting an MGM Resorts property. It doesn’t sound very customer friendly but I’ll wait and see how this is in real life. There’s only so much you can learn from a presentation.
Hacienda Bridge Will Be A Pedestrian Walkway
The Hacienda Bridge behind Mandalay Bay and Luxor will be closed to vehicles during Raiders games at the football stadium that’s currently under construction. MGM Resorts mentioned this on their earnings call but this isn’t new. Opening the bridge for pedestrians has been in place since the transportation plan for the stadium was first introduced. It just slipped my mind during the call. Expect to hear more about parking for the stadium over the next year.
Free Self Park at Wynn and Encore
Wynn and Encore will no longer charge for self-parking. Yippee! There will still be a charge for valet unless you’re staying at the hotel. Visitors will pay between $21 and $30 for valet parking depending on how long the visit. Valet may be validated by spending $50 or more in a day. You can read more about Wynn parking here. Wynn isn’t starting a trend. If anything they’re reacting to free parking at neighboring Fashion Show Mall, The Venetian, and Treasure Island. On MGM Resorts’ earnings call they said there’s no plan to change their parking fees because they’ve invested a lot of time and money.
“As Caesars Turns: Ruffin It Up”
On this week’s episode, Caesars Entertainment reports earnings and Phil Ruffin is now an interested buyer. There’s been so much drama surrounding Caesars this year that the lack of anything interesting from their earnings report was a bit of a letdown. Once again Caesars says they’re going to reduce comps. They talk out of both sides of their mouth on this topic since they also boast how the Caesars Rewards database can be weaponized when they need to increase revenue.
Maybe the new CEO will make some drastic cutbacks but I’ll believe it when I see it. The Las Vegas Review-Journal is reporting that Phil Ruffin is interested in purchasing Caesars Entertainment’s Vegas Strip properties. He has plenty of money so this seems possible. Maybe Ruffin will extend the tram from Treasure Island to Caesars Palace if this deal happens. At the same time, maybe he’ll sell Treasure Island and use the money to buy the Caesars properties. Stay tuned…
Stardust Craps Table On eBay
If you’re looking for some vintage Vegas memorabilia you might be into craps table from the Stardust on eBay. They only offer local pickup so you’ll have to arrange to ship this home unless you live near Kelso, Tennessee.
Marijuana Lounges Approved (settle down)
This week the city of Las Vegas approved marijuana lounges. These lounges will be a place where people can legally use the marijuana that’s been legally purchased from a licensed dispensary. Currently, it’s only legal to consume marijuana in a home or residence. According to the Las Vegas Sun, “licensed marijuana businesses in Nevada will be permitted to apply for special-use permits to open consumption lounges at which cannabis products may be sold and consumed on site.”
So, it will become legal to consume marijuana in these lounges at some dispensaries. This is a step in the right direction but you still cannot legally use marijuana in public or in casinos. Expect to hear more about specific lounges opening soon. Smokers might want to consider a 420 friendly Airbnb.
By the time you read this I might be a billionaire from my Kentucky Derby bets! In the meantime, I’ll share a few more nuggets from Las Vegas over the past week.
- There’s a new Cirque du Soleil show at Luxor. Read about it here.
- The Cosmopolitan has sold more than 600,000 verbenas. They’ve made almost $10 million from this drink. Did you know you could buy a “buzz button” for $2 (these are fun in beer)? Neither did I. Read more useless facts here.
- The Plaza is offering guests complimentary Happy Hour on Thursday for one hour. Hopefully, this is just the beginning. Daily Happy Hour is a great idea that you may have enjoyed at a hotel outside of Las Vegas. See the flyer here.
- Mariah Carey is never leaving Las Vegas! She’ll be back at Caesars Palace Las Vegas in November. Read about it here.
- Paula Abdul has her first Las Vegas residency at the Flamingo. Read more here.
- Learn magic from Penn & Teller! Read more here.
- Virgin Hotels introduced a new coffee shop in San Francisco this week. It will be opening at all future Virgin Hotels. Expect to see this when the Hard Rock reopens as Virgin Las Vegas. Read more here.
- Brooklyn Bowl has a slew of shows for $20 until May 7. Visit BrooklynBowl.com for more information. Here’s a list of shows available.
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