You know,” Michael Weaver says to me at the tail end of a lunch appointment that has been filled largely with gloom about the state of the Vegas economy, “there actually is one segment of the population that is actually up over the year before.”
“Yeah, it’s the strangest thing,” the Harrah’s marketing veep for Paris, Bally’s and Rio continues. “It might surprise you who.”
Hmm. Let’s see. We’re in the worst downturn in decades. Gaming and traveler figures have plummeted by numbers so shocking that even the biggest pessimist does a double take. Mammoth hotel structures stand along the Strip stuck mid-construction to taunt a greedy, overreaching industry that didn’t plan for the possibility that the boom would ever slow. And me? I had to travel to godforsaken Battle Mountain, crowned by the Washington Post in 2001 as the Armpit of America but thriving now as the price of gold soars, to find a story on anyone benefiting from this misery.
Yeah, Michael. I’d be surprised. Not just about who but by the very concept of good economic news. Hit me with it.
“Hispanics,” he says. “The Asians, the gays, the general market, customers in every age, geography and gender category are all down. The one consistent demo where you see increases are Latinos.”
We’ll get around to why this may be in a moment. But first, an answer to my—and likely your—first question: How do they even know?
I ask for numbers. It takes a week, but Weaver finds some he can provide without exposing some confidential data or stratagem that could lead to the downfall of all that is good and right in the Harrah’s universe. The company, of course, is famous for keeping tabs on a variety of details and characteristics of its Total Rewards customers, and one bit it tracks is those who either request information in Spanish or, if they play a lot and are entitled to one, have chosen a Latino casino host.
The point is, Harrah’s finds a variety of ways to tag its customers’ Spanish-language tendencies. And as it happens, the loyalty and resilience of that subset is stunning: In nine of 12 months in 2008, Harrah’s saw growth in gaming activity from these Hispanic customers. They’re also coming to their Las Vegas resorts frequently, Weaver says. The number of visits is up 5 percent. No one else is up at all.
Lest there be an impression that Harrah’s is an anomaly, I checked in with MGM Mirage, too. The information isn’t exactly comparable, but there is also some evidence on their side that more Spanish-speaking customers are coming. MGM Mirage officials say online bookings from Mexico and Spain, for instance, were up for every property except Monte Carlo in 2008 over 2007. And the number of domestic Hispanics who responded to MGM Mirage’s post-trip customer satisfaction surveys was up between 1 and 5 percent last year depending on the resort. The number of responses from the general population was down.
So, what’s going on here? Well, just as the data isn’t entirely conclusive, it’s also hard to know what’s happening. One casino executive speculates that Hispanics in America have been less impacted by the economic doldrums because they aren’t as likely to own their homes, and they tend not to be invested in the stock market. That means they can’t be foreclosed upon, and their money hasn’t vanished in fits of Wall Street recklessness. If that’s all so, though, surely they’re starting to feel it anyway in the form of rising unemployment.
Others, including Weaver, say they’ve found Hispanic customers to be extremely brand-loyal and responsive to bargains in activities they like. That is, they’re more likely to take advantage of the cheap room and show-ticket offers that have become so prevalent.
Another explanation comes from Edgardo Iorio, publisher of Que Pasa Vegas, the only Spanish-language tourist publication focusing on this city. The 50,000-circulation weekly is distributed across Southern California and Arizona, the regions from whence more than a quarter of Vegas tourists hail. Iorio notes that Hispanics are culturally less likely to freak out over economic uncertainty.
“Our people are used to crisis, to bad economic times, especially in Latin America,” he says. “Every country goes through this hell. For us, it’s not an unusual thing.”
Iorio says that as valuable as the Hispanic market is, it’s not taken as seriously by the Vegas resorts as it should be. The Las Vegas Convention and Visitors Authority, for instance, spends just 2 percent, or $1.3 million, of its marketing budget on Spanish-language media.
He notes that there are 110 million people in Mexico and 50 million Hispanics living in the U.S., and yet there’s precious little Spanish-language material available in Las Vegas. Mocking certain Downtown casinos that focus on Hawaiian travelers, he asks, “How many people can you bring in from Hawaii? We’ve got millions of Spanish-speaking people surrounding Vegas. Why don’t they cater to them?”
Casino brass are starting to. MGM Mirage next month will become the first Vegas gaming company to offer room-booking websites in Spanish. Many resorts have had Spanish-language hotel informational pages, but users were bounced to an English-language site to reserve rooms. No longer.
Harrah’s isn’t up to that yet, but they’ve focused their Hispanic marketing efforts on the Rio. Just this week, they’ve announced a Latin-themed nightclub concept coming to the old Club Rio space, ND’s Fuego. The first live concert in that venue is slated for February 12, a show by Gilberto Santa Rosa and Victor Manuelle, big Latin American stars largely unknown to white U.S. audiences.
Sensitivity comes in smaller touches, too. A few months ago, the Rio became the first major resort to offer a button on room phones that gives guests the option of connecting to a Spanish-speaking concierge or operator. There are plans to expand that service to other Harrah’s hotels as well as to add more Spanish-language literature.
“There certainly are many improvements we can make,” Weaver admits. “We are not yet adequately serving the Latino market.”
No, but that’s kind of the good news. While I appreciate Iorio’s frustration over being neglected, tough economic times have always forced Vegas resort owners to get more creative, to learn a greater appreciation for demographic segments they’ve ignored. In the 1990s, it was families; while many think of that effort as a failure, resorts continue to work hard—though less overtly—to cater to them with offerings from the Lion Habitat to The Lion King. The brief post-9/11 downturn made them realize the gay market was an untapped gold mine.
Now it’s the Hispanic market’s turn. It is too bad—and kind of baffling—that it took this long. But at the same time, it’s a relief that the casinos still have new pastures left to graze.