Lost Vegas: A lesson on the Importance of Positioning and Destination Branding.
Sin City. According to Forbes it is the 6th most visited city in the U.S. with over 36 million visitors heading to the desert each year. They also enjoy the lowest vacancy of any major city that made the list. The city always delivers on it’s brand promise. Gorgeous mega hotels, sprawling casinos, daytime pool parties, the hottest night clubs and restaurants, the ritziest shopping, dazzling shows and any possible form of adult entertainment the heart desires.
It wasn’t always this way. In the late 80’s and early 90’s amidst a consistent decline in tourism, the city decided to turn its focus to families. The reasons for the tourism decline were many, not the least of which was new competition from a boom in legal gambling on riverboats and Indian reservations. The city’s gambling revenues plunged, declining by almost half a billion dollars in 1992 alone. The hotels and casinos had become dated, vacancy rates were on the rise and tourists were flocking to other U.S destinations and had forgotten Vegas.
Over the course of the next 10 years, an estimated $12 billion was invested in developing and redeveloping casinos to be “family friendly”. Places like Treasure Island and Circus Circus replaced their dingy, smoky predecessors. The Las Vegas Convention and Visitors Authority had their sites set on stealing share from America’s powerhouse destination – Orlando, Florida. Millions of dollars were invested in advertising that focused on family-friendly amenities. Vegas had transformed itself into a series of mini theme park style hotels. Billionaire Kirk Kerkorian built the MGM Grand – America’s largest hotel resort with 5,000 rooms. He also spent $100 million to build an amusement park for children, while parents could gamble.
The initial results were spectacular. Families headed to Vegas in droves. The experience, however, didn’t work. According to casino owners, parents were either spending too much time with their kids (and not in the casinos) or parents were abandoning kids to gamble. Neither was a good result. Although the tourism numbers nearly doubled, casino revenues actually dipped.
The positioning was flawed. Trying to mix adult entertainment and family entertainment didn’t work. By the end of the 90’s city officials as well as hotel and casino owners decided to return to their roots: Adult Entertainment. They abandoned the family positioning and reverted back to what Las Vegas did best. New luxury hotels were built, new mega clubs launched and the themed hotels have become relics of a former era. One of the best destination campaigns was launched and has become part of our culture “Whatever happens here…”
In 2015 Las Vegas surpassed 42 million visitors hitting a new all-time record. According to The Las Vegas Convention and Visitors Authority, the tourism economy generates more than $50 billion annually and supports 366,000 jobs in Clark County — 43 percent of the total number of jobs in Southern Nevada.
As a brand, it’s easy to become enamored with what’s shiny and new. As marketers we want to chase the dollar signs. The hard part, often, is staying true to who you are and what you do best. Lesson learned Las Vegas.