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Rivals bet that comps keep Borgata at bay

ATLANTIC CITY – On a recent Saturday, everything was on the house for Ron Smith, who frequents this seaside gambling resort at least twice a week.

Smith enjoyed dinner, drinksa band at the Trump Taj Mahal Casino Resort. He had dessertlistened to cool jazz at Bally’s Park Place Casino Hotel,though he later drove home to Stratford, he had a complimentary room at the Resorts Casino Hotel – his favorite casino.

They’re afraid of the Borgata,” Smith said of the $1.1 billion mega-resort casino scheduled to open tomorrow. “The same thing happened when the Taj opened. All the other casinos were flooding you with stuff.

But this time, industry insidersanalysts say, casinos – faced with their greatest competition in 13 years – have defined the market far more narrowly than in 1990, when the Taj Mahal opened.

They are trying to hang on to their best customers, lavishing attention on hard-core, card-carrying loyalists who visit at least monthly.

I keep coming back because they keep giving me stuff,” said Rebecca DiBraccio, 42, a church administrative assistant from Levittownfixture at the Showboat Casino-Hotel.

On a weeknight last week, she visited Showboat with her mother, two sisters, husbandtwo daughters. They were on what she called “a mini-vacation out of the house.”

DiBraccio was taking advantage of her comps – typically, free lodging, meals or shows. She had a free two-night staybuy-one-get-one-free buffet offer at the Showboat.

We’re a Showboat family. They see I keep coming back by my card,” DiBraccio said, gently pulling her Showboat Total Rewards gold card from a nickel slot machine.

Showboat showered her with comps for two more nights this month.

I was amazed to get two nights in July,” DiBraccio said. “Summertime is big time here.

The casinos’ reliance on relatively inexpensive personal touches to make their most dependable customers feel special is an alternative to a promotional war against the Borgata, which casino operators have proclaimed would harm the industry.

Last month, Harrah’s Atlantic CityHarrah’s Showboat started a program that lets players exchange their comps for items or trips listed in a catalog. Before, they had to use them or lose them.

This is not an expense issue, but a way to allow customers to control their comp dollars,” said Dave Jonas, senior vice president of Atlantic City operations for Harrah’sHarrah’s Showboat.

The Sands Hotel Casino is emphasizing its small size, allowing more interaction between hostplayers.

By having a smaller employeecustomer base, it allows us to be much more up closepersonal,” Sands president Tom Davis said. “If our customers wanted big, they had an opportunity many times over to go to another casino in town that’s big.

While most of the casinos have been adding towers, remodeling hotel rooms, or adding retail outletsfancy restaurants in the last year, promotional costs have dropped.

For the first three months of the year, promotional allowancesexpenses slipped 3 percent from the same period last year, according to the New Jersey Casino Control Commission.

Part of that was because of the weather,” said Dan Heneghan, spokesman for the commission. “If you can’t get through the blizzard to get here, you can’t get a comp room, a comp meal, or a comp drink.

The value of the loyalty-players program is what the industry seems to be focusing on,I think correctly so,” said Michael Pollock, editorpublisher of Gaming Industry Observer, which tracks the industry. “There is not a price war or promotional war, but a difference in degreewhere they are spending the money.

Operators also realized there is no stopping someone from checking out the Borgata, said industry analyst Lawrence A. Klatzkin, managing director of Jefferies & Co. Inc..

There’s not a ton of spending at this point, just little reminders to come home” to their casino, he said.

Pollock said operators had learned from the promotion inflation when they went against the Taj Mahal in 1990. Some casinos boosted the value of giveaways to bus customers,other properties immediately followed suit. Pollock said that market share had not changed,that operators had spent needlessly.

The Borgata’s opening has not made casinos willing to dole out money for promotions to retain market share, he said. “They all expect a record summer in Atlantic City,it would be futile to throw money at customers when the whole pie is going to grow significantly.”

Klatzkin said operators also were waiting to see how market leader Park Place Entertainment – owner of Bally’s, Caesars Atlantic City,the Atlantic City Hilton – reacted to the Borgata.

If Park Place holds firm, everyone else will hold firm,” he said.

For now, Pollock said operators were focused on retaining promotion-card-carrying customers, such as Marge Hull, 55, of Maple Shade. It’s all in those casino cards, which record spendingpreferences for games.

They know my whole history through this card. They know I played here last night,” Hull said on a weeknight at the Tropicana Casino Resort as she checked her comp point total on her Diamond Club card.

Resorts was recently named casino with the “best comps” by Casino Player Magazine,among the beneficiaries has been Ron Smith, a Resorts regular for five years. His take? Two leather jackets, a 10-speed bike, a DVD player, a 19-inch television, a microwave, a four-piece luggage set, a $150 saw, a fax machine,even a turkey.

They’re still in bagsboxes,” said Smith, 62.
But when he began getting comps for a room at Resorts on Saturdays early last year, he knew he had turned a corner.

I’m not even a high roller,” he said, surrounded by the comps in his home. “Take a detailed look at the concept of no deposit bonus  That’s how I know they want you.

 





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