Summary: Casino resorts in Las Vegas are suffering from weakened visitors’ numbers, choosing to cut back or remove resort fees in order to entice traffic.
With every industry, there is a slow period. In Las Vegas, the slow time is now, and resorts are having to make big changes in order to bring in traffic to meet revenue needs. Visitors numbers have gone down, so many casinos have opted to cut down their fees or even offer promotions that have no fee in order to see visitors come to their venue.
Cutting Back Meets a New Low
In 2018, the visitor numbers for Las Vegas hit a new low. Many resorts are considering not raising fees at all this year just to ensure visitor numbers increase. In July of last year, the Wynn Las Vegas decided to stop charging parking fees for guests who stay overnight as well as those who were visiting during the day and spend less than $50.
To the Wynn, the fees were counter acting the type of customer service the venue wanted to provide. Several venues decided to start charging fees for visitors such as parking rates in 2018 and this seems to have backfired. For decades, visitors were able to stay on-site free of charge and regulars were not happy with the new charges.
In general, it can cost as much as $50 a day to stay on the Strip or even off the Strip by way of parking. During the slow time frames, resorts often increase the price of a room by a whopping 100% just to make up for the traffic slow down. Other services may also be charged for including WiFi service, pool usage, gyms, etc. Guests who stay at such properties have to pay the fee regardless as to whether or not they will be using the service.
On top of that, many visitors think they are getting a good deal due to booking their room online. Consumers can view casino resorts at online travel agency sites and see the least expensive option. However, the price listed is per room and not the total cost. Once fees and taxes are accumulated, the cost is much higher.
The casino hotels also pay a commission to such travel agencies based on room price and not the resort fee. This means the casinos will be more willing to increase fees as they do not have to pay on fees, but do on the room price.
So, resorts are now opting out of charging too much for the fees in order to ensure their visitor numbers. However, some are not making any changes. MGM Resorts International and Caesars Entertainment Corp. are two of the biggest operators in the region. They have decided to maintain their current fees for parking and resort charges after they were raised a few years ago.
Mark Frissora, the CEO of Caesars, stated that the company has no plans to change the fee structure. However, they are sensitive that they may hurt their own revenue growth and profitability if they rise the prices.
Caesars Entertainment will be offering free parking to visitors at The Linq Hotel this coming August to see if visitor numbers will be increased.
Overall, changes are being made to hopefully see visitors come back to Las Vegas at all times of the year. Visitor numbers were down to 42.1 million in 2018, which is a slight drop from the 42.9 million recorded in 2016. Operators are hopeful that they will see an increase in visitors so that they will continue to bring in much-needed revenues.