Atlantic City is open for business.
The latest casino revenue reports show gains in revenue in 7 out of 8 casinos, with two casinos seeing gains of over 50%. The stock market is churning along, surpassing 18,000 a couple of weeks ago. Nationally, unemployment is at a healthy 5.4%. Best of all, the U.S. economy is growing at the same rate as it was in 2003, mostly fueled by consumer spending. As people are straightening out their finances, they are traveling and spending money, and each casino is seeing a growth in revenue that is greatly outpacing the rest of our economy.
Most pundits aren’t seeing the forest for the trees. Their focus on the decline in total revenue for the city’s casinos belies the fact that the remaining casinos are doing quite well. Revenue has gone down citywide because properties have closed—properties that were unable to compete because of a lack of investment, foresight, and vision. With the exception of Revel, the casinos that have closed down all had the following in common:
- None had undergone any sort of renovations in years. Their facilities were dated and unable to compete with newer facilities both in and out of state.
- The entertainment offered by these properties did not attract customers. Most of the performers were C-listers, and little effort was made to book acts that may appeal to younger crowds.
Several of these casinos offered NO nightlife at all.
- Most of their marketing and advertising was concentrated on the expensive strip of the Expressway leading into AC. While several of the prospering casinos have run eye-grabbing campaigns on I-95, Philly, and the NY subway system, none of the closed properties did. These campaigns attracted visitors to AC, but by the time they saw the billboards for these other properties, they were already on their way to competitors.
- Lastly, and perhaps most greatly, the beaches behind most of these properties sat virtually ignored for years.
The axiom that one must spend money to make money has never been truer than in the case of AC. Several properties chose to coast by, not improve their facilities, and expect that people would continue to visit their establishments—they were wrong. Even more properties invested, rebranded, brought in advertising agencies from outside the resort, and focused on marketing in PA and NY—they are enjoying increases in revenue of up to 57%. Atlantic City must train its eyes on marketing in NY and PA. It must continue to invest in its facilities. It must continue to offer top-notch entertainment, and it must start to capitalize on the beach (more on this in the next installment).
Atlantic City will stay open for business.