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The Newsroom - 2008 |
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Resorts on Strip dealing
Projected room rates down for weekend
June 25, 2008 - With gasoline prices on the rise and the U.S. dollar
declining internationally, Strip hotels are slashing prices to lure
budget-minded customers.
Leading into the Fourth of July weekend, properties from the high-end Wynn Las
Vegas to the financially precarious Tropicana 21/2 miles south are tinkering
with room rates.
The report compares weeks in the year, not actual dates. So decreases are
compared to the weekend of July 6-7, 2007, or the week of July 1-7.
Companies cut room rates in the hope that customers will not only fill the
rooms, but spend the extra money in the property's restaurants, shows or on the
casino floor.
"They need to cut prices to fill rooms," said Brian Gordon, an economic analyst
with Applied Analysis.
Room rates in along the Strip have dropped on average for 13 consecutive weeks,
according to JP Morgan.
They are also projected to drop on average of 13 percent for the week of July
6-12 and 18 percent July 13-19.
"One of the things properties are able to do is provide a more affordable room
rate for their guests," said Bryan Allison, vice president of marketing for the
Las Vegas vacation Web site Vegas.com. "We're in a great situation here."
However, Allison said that travelers might go to only one show instead of two or
maybe skip dessert no matter how good of a deal they get on the room.
Many of the travelers the hotels are trying to lure back to the Strip might be
customers who were lost when rooms hit the $300 to $400 per night range.
"A lot of the price-sensitive consumers have been staying away," said Charlyn
Keating Chisholm, a travel writer covering the hotel and resort industry for
About.com. "The companies look at how they can pull people in and that will be
the first reaction -- drop the room rates and (hope they) spend money on things
like the restaurant."
While the majority of Strip properties are cutting prices, rates at Planet
Hollywood Resort are increasing 18 percent on the strength of newly remodeled
rooms and the hotel's rebranding from the Aladdin.
Earl said managers decided to give away "one or two goodies" such as meal
tickets or show tickets with the room price rather than cut the room rates. |
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2007 rates based on the Fourth of July weekend of July 6th
through 7th.
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However, he admits it is a challenge to market higher room prices in the slowing
economy.
"There are all sorts of prices out there at the moment and in the summer,
everyone is very price- conscious," Earl said.
The property also has a lot of advance bookings from international visitors
because of the weak dollar.
"Particularly with the Brits, as a destination becomes available the first few
years, it becomes a top destination," Earl said.
Allison agreed.
"The good news for us as a city is that international travelers are finding this
is a bargain. So you're seeing international travelers coming in, staying a
little longer, maybe they'll spend a little more money.
"Again, it's because of the strength of the euro and the pound."
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Author: A. Knightly, Las Vegas Review-Journal
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