Marlene Kowalsky's elevator ride at the Four Seasons Hotel was unusual for Las Vegas. The doors opened to a brightly lit lobby with marble floors, a genteel lounge, flowers and original artwork. Kowalsky wasn't ambushed by the clang of one-arm bandits dumping coins into metal trays and rows of poker machines, roulette wheels and card tables. In fact, the Vegas Four Seasons has no casino.
The very existence of an AAA five-diamond resort in Sin City is anathema to the old Las Vegas. It's contrary to the town's axiom forbidding clocks on walls and making rooms overly comfortable--fearing guests would not spend hours feeding the slots and betting double down on a blackjack hand.
"Gambling is no longer the No. 1 reason to go to Las Vegas," said Kowalsky owner of St. Clair Travel, O'Fallon, Ill. Instead, she is booking more trips for clients attracted by the city's high-end dining, shopping, spas and golf. Some folks don't drink, smoke or gamble, but they'll hit the Forum Shops at Caesars Palace, dine one night at the knockoff of New York's Lutece at the Venetian, and climb up the faux Eiffel Tower at Paris Las Vegas to watch the dancing water show across the street at Bellagio.
From a marketing standpoint, however, there's a lot more to the story. Las Vegas today means different things to different people, and marketers find themselves hard-pressed to find a core brand essence. While repeat visitors are aware of the city's transformation, others haven't updated their frame of reference. They still see the place as high rollers, neon lights, gambling and comp rooms. The image gets fuzzier when consumers recall recent efforts by some resorts to attract families with theme parks and shows.
"I think making Las Vegas a family destination was an old marketer's dream," said Larry Varnes, vice chairman and chief strategic officer for Caesar's ad agency Grey Worldwide, Los Angeles. "Those places that catered to family specifically are not doing too well."
R&R Partners, the ad agency for the Las Vegas Convention and Visitors Authority, has been researching perceptions of the city with the goal of developing a stronger and more consistent branding message. "We found that because the destination has grown so fast and the product has diversified so much, it confuses people," said Julie Wolf, R&R's senior account supervisor. "Even though Las Vegas is one of the strongest brands in the world, it's fragmented, and that clouds the issue for people who haven't been here in awhile."
When R&R delved deeper into what motivated people to come to Las Vegas, they found consumers talking about the freedom to do anything they wanted, whenever they wanted. "That is what sets Las Vegas apart from other destinations: they can enjoy these things virtually around the clock," said Wolf.
The research culminated in last September's launch of a $40 million branding campaign ushering in a significant change in strategy--away from typical destination marketing, infused with emotional branding. In the campaign, Las Vegas is no longer being defined by its former attractions, but rather by concepts embracing adult freedom.
That was the theme of the initial series of ads in which fictitious Las Vegas Freedom Party candidate Brock Wilder beckoned Americans to escape from the drudgery of everyday life and start their own party with a trip to Vegas.
Freedom also takes center stage in testimonials from visitors touting the city's "freedom to dream," "freedom to be fabulous" or "freedom to let yourself go." Directed by filmmaker Errol Morris, the new TV ads (breaking in late March) are touching enough to be believable--see "The Frosts," a couple from Sheffield, England, who come to Vegas to celebrate their 40th wedding anniversary--yet are also pleasingly quirky and wry. Siegfried & Roy appear in one spot to say that "Vegas is the attraction. We only add a little magic," followed by comic magicians Penn & Teller, who proclaim: "There's no beige in Las Vegas. The rest of the country is becoming very, very beige. Come to Vegas, make a lot of money and paint everything fuchsia."
This month, a second wave of ads builds on the freedom theme with the tagline, "What You Want. When You Want." These further distance the branding from destination marketing. No images of golf courses or four-star restaurants here: The spots employ quirky characters yearning for the freedom of Vegas. One character is a cabin dweller in the frozen Yukon who escapes the bitter cold by taking pictures of himself and pastes them into his Vegas photo album. Another story involves the "mud-flap girls," silhouetted figures who come to life and hitch a ride on a truck bound for Las Vegas. This ad will debut during the Super Bowl in 12 markets.
It's a new era for image makers in Las Vegas. Marketing here once amounted to a one-on-one customer-service effort in which hotel reps attracted high rollers to the property. It was assumed that the glamour of rubbing elbows with big money or simply being where the action was would be enough to attract the chump-change crowd. Today the Entertainment Capital sells itself with image, as hotels strive to get tourists to do more than just stop at casinos.
The watershed event came in 1992, when Henry Gluck opened the Forum Shops at Caesars with retailers like Gucci, Guess and Christian Dior. As then-CEO of Los Angeles-based Caesars World, Gluck eschewed the Las Vegas mantra that a dollar spent at a restaurant or shop was a dollar taken away from the casino. Besides, his wife complained there was nothing for women to do who didn't want to hang around in dark, smokey casinos all day. Built in 1966, Caesars already was positioned as a must-see attraction banking on the grandeur of ancient Rome to become the first bigger than life theme property. Rooms and restaurants then were just necessary side shows to the splendor that hooked traffic to come inside and drop money at the casino.
"I think when he built the Forum Shop, it absolutely escalated geometrically the whole must-see attraction of the property," said Grey's Varnes. "Then Steve Wynn saw the brilliance of Henry and built Treasure Island and Bellagio after the Mirage."
Wynn, another developer, built the Mirage hotel in 1989 with a flashy volcano front yard, a rain forest atrium and luxury rooms. It was a departure from the tried-and-true Vegas model of $75 rooms, cheap food and entertainment, and free drinks. "So you have these two properties next to each other--Caesars with the shops and Mirage with the volcano show--generating tremendous foot traffic. Obviously these people will walk in through the doors and spend some money," said Varnes.
Before Wynn built his string of theme properties with dynamic retail and dining experiences, Gluck had recruited famous chef Wolfgang Puck to open a Las Vegas branch of Spago within Forum Shops. In the desert swarming with buffets and $2.99 steaks, Spago's California cuisine was an immediate hit. Puck added Wolfgang Puck Cafe at the MGM Grand the following year and Trattoria Del Lupo later at Mandalay Bay.
Other chefs and developers noticed and hustled to draw gourmet palates, not just gamblers, with name restaurants. Soon Emeril Lagasse, Mark Miller, Jean-George Vongerichten and others brought haute cuisine to the desert. Now Las Vegas boasts two restaurants--Mirage's Renior and Bellagio's Picasso--that sport the rare Mobile 2000 Guide's five-star rating.
Thanks to Wynn, every significant property on the Strip has adapted to the paradigm shift. Via Bellagio vies to rival the Rodeo Drive shopping experience. A replica of Venice's St. Mark's Square, a waterway with gondolas and cobblestone streets add to the ambience of the 74 stores at the Venetian's Grand Canal Shoppes. A North African mystique exudes from the Alladin's Desert Passage, while French boutiques line Le Boulevard of Paris-Las Vegas. Recently more than 30 spas have popped up--complete with exfoliant treatments, French caviar facials and couple massages--providing more reasons to skip the casino.
"The role of advertising and marketing in a broader sense is to get people into and onto the property," said Varnes. "There is a huge battle for getting a name restaurant and name retailers because of the positive association."
Rooms are also factoring into the competition.Sheldon Adelson, developer of the Comdex computer show, followed the Bellagio's 480-square-foot standard rooms by building the Venetian with 700-square-foot standard rooms. Old Las Vegas' cheap, spartan quarters for small-time visitors gave way to marble bathrooms, oversized beds and walk-in closets.
Since the early 1990s, the building spree not only transformed the skyline with the Statue of Liberty pyramids and roller coasters, but has brought more than 120,000 rooms to market, compared with more than 67,000 a decade ago. Hotel occupancy through October was 93.9%; the national average is 63.3%.
Continued from page 1.
As a leisure destination, Las Vegas is not the most profitable route for major domestic airlines, which prefer deploying aircraft where they carry high-fare business travelers.American Airlines, for example, pulled nine flights during the spring, citing low revenue. The city's popularity however, created an opportunity for National's founder, Michael Conway, to convince Harrah's Entertainment and Rio Hotel & Casino to kick in $15 million toward a $50 million startup fund. The partnership enabled National to introduce flight and baggage check-in from Harrah's and Rio hotels and to use Harrah's database for direct marketing.
National's product--more leg room, hot meals served on china and at least four flight attendants per flight--seemed to suit the upscale Las Vegas experience at a reasonable price. By positioning itself as "Las Vegas' Hometown Airline" in ads and billboards coming from E.B. Lane, Phoenix, the carrier rode on the coattails of America's fastest-growing city
"When you have 32 million people a year coming to a city that keeps reinventing itself and continues to get more popular, there's opportunity there," said David Maritt, National's svp-marketing. "Everyone in the world knows Las Vegas and when they think of Vegas, there's a smile on their face. Our goal: When you think of Vegas, you think of National Airlines."
(Note: National filed for bankruptcy protection in December. The carrier had turned a profit during March just 10 months after its started operations with routes to Los Angeles--Vegas' largest feeder market--San Francisco, Chicago and later expanded to nine cities. But fuel costs doubled while bookings dwindled, putting the startup airline in the red by September. While negotiating with Boeing to work out financing on a previous agreement with the manufacturer to buy four aircraft slated for service to new destinations, National continues to fly Harrah's said it will write off its investment in the airline.)
Despite its penchant for reinventing itself, Old Las Vegas is still there. Wayne Newton sings at the Stardust, seamy topless shows and buffets with mountains of scrambled eggs can be found, and Midwesterners can snag weekend hotel packages, including airfare, for about $300. The marketing of Vegas was once about shows, the Rat Pack and customer relations--which essentially meant comping high rollers with free rooms.
Image is a bigger part of the transition now, yet the immediate forecast for the fastest-growing city in the country is more growth--big is bigger. The Alladin opened 500,000 square feet of Desert Passage this summer. Caesars is now preparing for the third expansion of the Forum Shops, boosting space to 740,000 square feet and recruiting retailers from ItalySpain and France. The San Francisco-themed City by the Bay property has broken ground, and the Venetian could start adding another 3,036 rooms next year. Also, a monorail could be zipping tourists up and down the Strip by 2004.
Yet all eyes are on Wynn to see what he'll do with the 230 acres of the Desert Inn he recently acquired. His plans could send Vegas speeding off in another direction. Or the city could follow Gluck, who is involved with Lake Las Vegas, a resort golf community surrounding a private lake 17 miles from the Strip. Gluck and company, Transcontinental Properties, recently signed Ritz-Carlton to build a Mediterranean-themed luxury hotel, casino, spa, condos, retail and office space. Indeed, the next frontier may be away from the hustle and bustle of Las Vegas Boulevard to more exclusive and isolated luxury properties, like the Regent Las Vegas. There are also more than 50 golf courses around the city.
With all the growth and infrastructure, is new Las Vegas as recession-proof as the old one?
The destination is still affordable, but the airlines are awaiting the impact of a cold winter and rising heating oil and natural gas costs on vacation plans. Tourism could slow down if National, which delivers 7.5% of all air seats to Vegas, reduces service or goes out of business; other airlines could take three to six months to pick up the slack, according to Deutsche Banc Alex Brown analyst Mark Mutkoski.
"The big problem clearly for Las Vegas revolves around the big-money people," said Varnes. "When there were [economic] difficulties in Japan, there was a downturn in big money A major problem in the Middle East could be a concern. I don't think Las Vegas is as recession-proof as it had been in the past."
COPYRIGHT 2001 BPI Communications, Inc.
COPYRIGHT 2001 Gale Group