Sunday, December 18, 2016

Las Vegas 2016 visitor fee increases and takeaways ... with more to come

Vegas visitor fee hikes and takeaways beyond annoying

This blog article originates from a Las Vegas fan /consumer stance and is largely a philosophically opposed view to the recently blatant corporate mindset in force within our favorite destination city. We're avowed proponents of capitalism but are of the opinion that the bean counters have overstepped the line in Vegas. There is no reverence for Vegas tradition with these guys.


The  current management approach of most Las Vegas resort hotels, casinos, restaurants, and bars (particularly on the Strip) has followed the lead of the US airline industry. That approach is to eventually charge customers for anything and everything that was once free or a perk in the not-so-distant past.  Some of these charges are implemented with deceptive or unknown methods until the bill arrives. Their ensuing public"sell" justifications from their public relations teams for these wallet-gouging hikes are deceptive..and they ring hollow for visitors who have experienced the Vegas of even the recent past.

The Las Vegas tourism industry cohort (CEO's , management, consultants, and assorted/related purveyors of tyrrany) have indeed stretched the boundaries of capitalism into a pasture of unbridled greed these days. As the old movie line suggested..'greed is good', and they're passing along that related cost mantra to Vegas visitors. Many of the old Vegas traditions, including comps and freebies for mid and low tier gamblers, have been progressively disappearing and continue to dwindle.We can speak to that latter issue based on considerable personal experience at both MGM and Caesars properties during the last three years in particular.

MGM Resorts International (owner-operators of 14 separate Vegas Strip properties) initiated a  Profit Growth Plan in 2015. From the company's perspective, the intent is to capture sustained growth, enhance margins, and drive revenue generation up by $400 million by the end of 2017. In essence, it has and will continue to negatively affect customer experiences in terms of everything from bath toiletries and bed linens to increased resort fees, parking fees, reduced alcohol in cocktails, reduced comp offers, surge pricing at restaurants during high demand times, and even charges for concession and franchise fees tacked on to final bills at some of their associated venue bars and restaurants. The bottom line for patrons is less overall bang for your buck in a lot of areas. Further, the MGM employee  base (layoffs) and worker satisfaction metrics have been affected as well. Vegas Tripping , a long-standing Vegas travel blog and travel site, has published an informative article on how CEO Jim Murren and top staffers will specifically benefit from the MGM Profit Growth Plan.

Caesars Entertainment owns and operates 11 properties primarily located on the Strip (excluding the Rio). The company is inundated with a mountain of debt and segments of the company are currently under bankruptcy protection from creditors. Caesars has typically followed MGM's initiation of charging for resort and parking fees, despite a years - long marketing program based on "no resort fees" prior to March 2013. They eventually caved, with the company's director of corporate communications stating at the time that resort fee implementation was something guests asked for (Las Vegas Sun article). Really?

The following lists some annoying visitor fee increases, gouges, or customer squelches that have been initiated in Las Vegas resort establishments through December 2016. Some of the annoyances have been ongoing for years.

1. Vegas hotel resort fees

These dreaded fees have been in force since at least 2008, and they represent an 80-90% return above cost margin for Las Vegas hotels. Resort fees (RF) really represent a pure profit endeavor for the hotels, partly because of enhanced tax breaks on the RF income that they aren't required to pay to state and local governments. Due to this tax incentive, separation of room and resort fee charges is monetarily better for the hotels than simply increasing room rates. Further, online, third party advertised room rates appear lower from room consolidator third-party booking sites with this uncoupling of charges. Adding insult to this injury is an added sales tax on resort fees per day for hotel stays. Resort fees have progressively increased since initial implementation, with MGM increasing fees as recently as November 2016. Most Strip hotels currently charge in the range of $25 -$40 per night including taxes.

Since the onset of resort fees, two main consumer complaints have been 1) being forced to pay mandatory fees for services never used during stays and 2) nondisclosure of the RF charges until final checkout. The Federal Trade Commission (FTC) governs resort fees and federal legislation was introduced in mid-2016 that would prohibit hotels from advertising a room rate that doesn't include all mandatory fees. It has been said that if this legislation is passed by Congress, resort fees may end as we now know them. In fact , Las Vegas hotels have been reasonable in their disclosure of the fees at least since 2012 after a nationwide FTC warning regarding RF disclosure. Resort fees are thus no longer a "hidden" or poorly displayed fee, but that does not address the other major complaint regarding charges for services never used by many patrons. A much fairer and more equitable practice would involve specific charges for specific amenities at a given Vegas resort. Of course, likely they'd just hike those specific amenity charges as well.

2. Paid Parking at Vegas resorts 

Despite a long-standing Las Vegas free parking tradition, MGM Resorts began charging for both valet and self-park privileges at all their Strip resorts (excluding Circus Circus) in June 2016. Caesars, Wynn / Encore (valet parking charges only), and Cosmopolitan properties have since jumped on the paid parking bandwagon as well, with most having completed parking plans by early
2017. Self-parking charges average $7 - $10 per 24 hours and valet charges are $13 - $18 per 24 hours at MGM Strip properties.

These new parking charges will not only greatly affect patrons, but will also affect valet attendant gratuities. Virtually every valet parking attendant that we asked (roughly ten individuals at six different properties) on a recent Vegas trip are dreading the new parking situation and how it will downgrade their daily work experience and income. Who cares..anybody can park a car and offer good service with a smile, ehh?

M Life loyalty club members at the Pearl, Gold, Platinum, and Noir tier levels can use MGM parking garages gratis ; Gold, Platinum, and Noir members can park at valets for free. Complimentary self-parking privileges are also available for M Life Rewards MasterCard holders.

Caesars Entertainment Total Rewards loyalty club members at the Platinum, Diamond, and Seven Stars tier levels can avoid any parking charges.

Currently, the Venetian, Palazzo, and Treasure Island are the only major resorts on the Strip that won't be charging for customer parking by early 2017. Again, Wynn and Encore will only charge for valet parking (self-parking will be free).


3. Reduced alcohol in mixed drinks at MGM resort bars

MGM Resorts has decreased the amount of liquor poured in an average mixed cocktail from the old standard 1.5 ounces ( a shot) to 1.25 ounces, a 17% decrease. ( see Vital Vegas blog post)

4. Reduced comp offers and reduced player favorable gaming odds

Our personal comp offers have decreased in both number and quality during the last three years from both MGM and Caesars properties. Our gambling levels/ wagers have actually increased during that same span. For us specifically, the comp offers are the core basis for the trips in the first place. Slots are tighter and one has to go on a treasure hunt to locate a 3:2 blackjack game with decent player-favorable rules with less than $50 minimum bets on the Strip. Comp offers from the Venetian and Palazzo went over the abyss for low and mid-tier gamblers about five years ago (see Las Vegas Sun article).

One strong and simple recommendation here is to simply refuse to play any blackjack game that pays 6:5 payoffs on player naturals. Playing these games triples/quadruples the house advantage percentage over players. There are enough gunsels playing these games as it is, which is why the casinos get away with it. This should be one of those Vegas moral code thingies.

5. Surge pricing at Vegas restaurants and bars

Las Vegas resorts have routinely charged more for weekend room stays vs midweek for a long time. Vegas visitors are used to that aspect of supply and demand economics. Now, there's an increasing trend for restaurants and bars at large Strip resorts to hike menu / entree / drink charges based on demand. Online menu prices for many restaurants now do not include pricing...patrons on Saturday night might not realize they're paying X dollars more for an entree than they would have if they'd visited on a Tuesday or Wednesday night. Even the sacred Las Vegas buffet prices have routinely increased on the weekends these days at most MGM and Caesars properties. Folks, it's not far to In-N-Out Burger from the Strip...there's one located one mile west of the Strip on Tropicana Avenue.

6. Concession and Franchise Fees at Vegas restaurants and bars

Some Vegas Strip bars and restaurants are now charging a tax on a tax and calling it a Concession and Franchise Fee (CNF). It is one of those gnarly hidden fees that customers have been largely unaware of until they are presented with the final check. They are added to a total bill 'after' sales tax has been tacked on. The primary justification offered by these establishments for the CNF charges is that they offer prime Strip locations.. Honestly, if an establishment charges an offensive CNF, they're anything but a prime location in Vegas. Patronizing these venues is akin to playing 6:5 blackjack games..just don't do it (unless you enjoy getting kicked in the nuts). Ask the server before placing any order..be happy to walk out if they have a CNF charge. CNF  charges typically range between 3 - 5% of total bills. Check out our sources for this info at Vital Vegas and Las Vegas Advisor .

7. MGM Resorts to penalize guests booking rooms via third party providers

According to Vegas Tripping , MGM Resorts will withhold services and tack on fees for guests who late cancel or no-show for third-party bookings (such as Expedia and Priceline). MGM has filed a trademark application for the slogan "Play The Smart Hand. Book Direct". The source indicates cancellation and/or no-show fees will be much higher through third-party bookings than for guests booking directly with the hotels. Customers and travel agents will despise this gouge as well, should it go into effect. There are several linked ads for MGM room bookings as of this writing touting the new slogan, so it is or likely will be in place soon.


Bottom line? Vegas has always routinely changed. Vegas is painfully different these days... even within the last three years. The marketing analysts, accountants, and high-level management run the city now. We're all for capitalism and the forces of traditional supply and demand. We respect their right to make a profit and are fully aware that their responsibility and success is governed and measured by things like margins, EBITDA, and revenue.  There is a perpetual tendency for the powers to not appreciate customers. It would produce a big ol hat feather if all the pissed off Vegas visitors could convince these people that Las Vegas has never been and never will be New York, Orlando, Miami, or the like. The traditional draws of Vegas are rapidly disappearing or already obsolete. Their anti-gaming, anti-customer, anti-Vegas mindsets hold no traditional value or respect for what was once one of the greatest destination cities on the planet.

Las Vegas visitation statistics indicate the public is going to show up in record numbers despite fee hikes and hidden gouges. Vegas visitor numbers have hovered at approximately 42 million in 2015 and 2016 (Las Vegas Convention and Visitors Authority stats). The increased visitation ( and improved discretionary spending vs the downturn in 2008 - 2010) is an inseparable part of the above gripes, and the giants are milking it.

Honestly, despite the above annoyances, the grand majority of us will still visit Vegas. The above won't keep us away...even most of those who swear they'll never set foot in the resorts again. In fact, we ourselves are just finalizing plans for our January 2017 Vegas visit. We'll just spend more concentrated time mentally flipping these guys off during the upcoming Vegas jaunt.




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Mostly Useless (and approximate) Las Vegas Facts

1. Number of Las Vegas citizens   500,000
2. Number of Clark County residents   1,500,000
3. Year first casino licensed   1931
4. Number of slot machines in Vegas   200,000
5. Number of annual Vegas visitors   40,000,000 (and dropping)
6. Number of licensed gambling entities   1700
7. Hours per day average visitor gambles   4
8. Annual state gaming revenue   9 billion (and dropping)
9. Average gambling budget per trip   560  (and dropping)
10. Mean price per acre in valley   161,000.00
11. Price per acre on the Strip   11,000,000.00
12. Number of  hotel rooms   137,000 +
13. Number of pillowcases washed at MGM daily   15,000
14. Number of doors at MGM  18,000 
15. Annual no. toilet paper rolls used at Bally's   1 million
16. Lucky The Clown marquee sign at Circus Circus has
      1232 fluorescent bulbs, 14,498 incandescent bulbs, and
      3/4 mile of neon tubing light  (no wonder they're replacing
      it!)
17. In good times, Excalibur goes through over 44,000 
      Cornish game hens, 15 thousand pounds of hamburger
      meat, and 4200 pounds of prime rib monthly
18. Caesar's Palace has used 2 million plus maraschino 
      cherries, 11 thousand ounces of caviar, 2 million ounces
      of tomato juice, and close to 600 thousand ounces of
      vodka yearly (bloody mary winner?)
19. Mandalay Bay has 5,300 palm trees and their wave pool
      has a capacity of 1,640,270 gallons of water
20. Average nightly room rate  119.00 (and dropping)
21. Average number of Vegas weddings per day   300+
22. Number of golf courses  37
23. Miles of neon tubing on the Strip and Downtown  15,000
24. State's nationwide rank in gold production  1st
25. Cost of Nevada marriage license   35.00
26. Average cost of filing for divorce  450.00
27. Average length of stay for visitors    3.7 days
28. Number of hosted conventions annually  3750
29. The electric bill to operate the Luxor pyramid beam is
      approximately 55.00 per hour.
30. Las Vegas has 17 of the world's 20 largest hotels   

"WHERE'S MY WALLET , ETHEL!? "

Just a cautionary tip when in Vegas.. there are active
pickpockets all over town. I experienced this first-hand
and came within 10 seconds of losing my cash stash last July
while visiting one of those upper end joints on the strip.

I was gambling significantly at a video poker machine, unabashedly slipping C-notes in them. Somebody had been
observing my wagering behavior. I was happily winning at the time and my cautionary tendencies regarding my bankroll
money went south and out the window.

A lady approached me from behind as I played and was all aglow with my run of good luck. She initiated a conversation about nothing and anything . I was concentrating on proper VP strategy and responding to her comments with a lot of "yeah-yeahs". I was fortunate enough to get ahead on the machine again and I cashed out. I had a satchel (I normally never gamble under those conditions) with me that had assorted trip stuff in it. The satchel presence and the relatively high denomination coin-in amount collectively screamed " please rob me!" I placed my wallet in the satchel along with the machine cash-out tickets and proceeded to reconnect with my family and head to our room.

I had developed a sense of cautionary unease as I mulled over the contact with the effusively talkative woman at the VP machine. My senses told me that something about that encounter was skewed, although at the time I didn't know what it was and I wasn't bleeding profusely..yet. My group then proceeded to meander through a very crowded slot machine aisle and some other 6th, 7th, or 8th sense that vaguely detected an impersonal yet succinct encroachment into my personal space kicked in. Instinctively, I immediately dug into the satchel to locate my wallet and it was gone. I then immediately turned around and backtracked about ten feet (a matter of maybe 3 seconds, tops) as my endogenous adrenaline kicked in. I'm not sure that my hair wasn't on fire briefly.

I then spotted my wallet (and life) in a woman's hand who was playing a slot machine. I walked straight at her and demanded it post-haste in a tone that screamed seriousness. I immediately grabbed the wallet and called for security. The woman claimed she picked it up off the floor and so did the man (her accomplice) behind her, both vowing that they were planning to remit it to the security desk. My svelte ass they were.

This team of thieves including the woman who was all goony-googoo at the VP machine were pros. I have to claim part of the blame for the openly careless manner I had displayed with my money. They were held by security and the eye-in-the-sky tapes were to be reviewed.

The good thing is I didn't lose a cent because my peripheral senses kicked in immediately and they didn't have time to bury the evidence ( perhaps they weren't the best of pros?). Take heed folks..these people are everywhere in Vegas. Know where your cash is at all times; take precautions to protect it, don't flaunt it around carelessly as I did, and if you sense something is awry while gambling trust your instincts.

Distractions from one member of a team of thieves is a common MO. Store your gambling session monies in a front pants pocket or in one of those god-awful front-loaded fanny packs (pride be damned). The lesson I learned here after several years of Vegas gambling experiences turned out to be one of the most valuable for me personally.


Cheers..
Chuck60