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Nightclub Confidential

Comps Down, Tabs Up in Vegas

January 5, 2011 By: Sean Evans


It’s always been easy to get people through the door of a club in Las Vegas. Simply comp their admission, give them free booze and within no time the place will be packed. Comp’ing has always been a necessity; who wants to bring a big spender through the doors only to have them set eyes on a dead, empty club? So in go the models, the promoter tables and the friends of the owners and operators, all gratis. And when the paying client is being walked to his table, he feels better about parting with $4,000 for a few bottles of vodka or Champagne because the environment is spot on.

It used to be that the paying whales far surpassed the comp’ed revelers, leaving clubs markedly profitable. But when the economy tanked, the gap widened and the comps soon soared as clubs struggled to fill thousands of square footage with partiers. A quick glance at the SEC’s EDGAR database will reveal that some Vegas establishments are doling out close to $100 million per year in comps, as it reports the Wynn did with its food and beverage programs this past year. However, that may all be turning around.

“Our New Year’s Eve this year beat last year’s,” says Jodi Myers, president of The Light Group, which oversees 17 venues, including three major nightclubs – Haze at Aria, Bank at Bellagio and Jet at Mirage. “The Vegas nightclub market has been gradually increasing and getting back to where it was.” While Myers declined to put a percentage on how much business was up, she did note, “every morning, I see the numbers from the prior night as they compared to last year, and 95% of nights in the last few months have been up. Some are significant. January 1st was an enormous night for us across the board.”

As for the high rate of comps plaguing the strip, Myers acknowledges its temporary need. “When the economy tanked, guests and clients did absolutely want the bargain, and to keep them in-house, we obliged them,” she says. “But now, that’s less and less the case, and we’ve become significantly more strict on what’s free. We’ve got higher bottle minimums now, and we’re seeing that people are paying it.” A typical spend in a Light Group venue is one bottle per three people, with a minimum of two bottles per table. That averages out $1,500 - $2,000 per table.

Those minimums can skyrocket when a huge night is being marketed, such as is the case with a celebrity performer slated. “We had Bruno Mars last Saturday,” Myers offers. “People don’t mind spending the money if they’re having a great experience. On a night like that, people were paying a premium. We had a lot of $10,000 minimum tables.”

Further helping to drive up spending is when guests feel like they’re in a new venue, even if they’re really not. Hence the remodeling movement, as Light Group did with Bank at the Bellagio a few years back. Rumor has it that Jet at the Mirage is similarly scheduled for a complete overhaul, turning it into a completely different feel with a new name, but Myers declined to confirm when asked.

Also helping to regenerate the action in the nightclub sector is the upcoming pool season. “The pools and daylife parties really help to supplement the nightlife. It brings different people and more people during a typically quieter time of year – given how hot it is in the desert,” Myers says. “But the pool scene is helping us stay busy year round.” However, the best help is simply the opening of new places in general. “Any time a new club or casino opens, it’s good for Vegas as a whole,” Myers adds.


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