More On Why The Vegas Strip Is Changing
I love the Vegas strip. There’s no place in the world like it. There never has been and there never will be. It’s awesome. That said, the strip has been changing a lot from when I first started visiting Las Vegas for
bettor better and worse. Right now the center of the Vegas strip is where you’ll find plenty of construction for The Linq, The Quad and Bill’s but in the next few years the construction will be moving to the north end of the strip with Resorts World and SLS Hotel.
The Vegas strip change isn’t anything new. CityCenter, Cosmopolitan and even Wynn ushered in change over the past decade because their customers are changing. People don’t come to Las Vegas just to gamble like they used to. They come for the night clubs, fine dining and shows. In fact, people have been coming to Las Vegas for those things more often almost every year since 1990 and in 1999 when people began spending more money on things beyond the casino.
Revenue is the total amount of money spent and not profit. This chart only shows gaming and non-gaming revenue so let’s look at an approximation on gross profit. The house edge (ie. gross profit) on some of the worst bets in the casino is only 30% with the lowest house advantages being under 1%. Meanwhile, the markup on a bottle of wine in a 4 star restaurant can be 200% or more. Even a soda at a low end restaurant will be marked up over 1,000%. The markup on a bottle of vodka at a nightclub dwarves all both of those.
In todays, corporate run, Las Vegas every square inch of a casino has to show a profit. This information has to be reported every quarter and in order to show shareholders that the future looks bright they have to always show a profit. Sure the casino may lure you in but the real money is made on those awesome SW steak dinners or at a table in Marquee.
Even if the Cosmo only gets a percentage of the revenue from Marquee there is a nice chunk of money to be made their from small stake plus rent plus overflow spending at restaurants and bars.
Gambling hasn’t left Las Vegas. Far from it. While the chart above shows that 35% of the revenue earned on the Vegas strip is from gaming you’ll find that Downtown Vegas still earns the majority of its revenue from gaming.
Moving forward expect this trend to continue. If you’re a gambler you’ll probably find better gaming options and more people like you downtown. If you don’t mind worse gaming odds and don’t mind being around different people you will still be able to find fun on the Vegas strip.
Personally, I love the both the gaming and non-gaming Las Vegas and look forward to seeing what the future brings.