Jason Strauss & Noah Tepperberg: Marketing Midnight
Can we please use this picture again?” Noah Tepperberg jokes as he flips around a frame containing a copy of the cover of Nightclub & Bar from 2004, featuring himself and business partner Jason Strauss. “C’mon, I look great here! We look so young! Look at all my hair,” Tepperberg chuckles as Strauss, seated next to him, laughs. The duo are reminiscing while sitting in Tepperberg’s office, located on West 27th Street in New York City, less than five blocks from their famed club, Marquee. While they had operated several clubs in Southampton and Manhattan previously, Marquee is the venue that truly put them on the nightlife map when it opened in 2003.
Seven years and seven venues later, Tepperberg’s office wall seemingly doubles as an impressive résumé for the duo; it’s adorned with multiple matted New York Times profiles, Wall Street Journal features and more pieces of prominent press, linearly showcasing the twosome’s ascent from club promoters to their positions as kings of clubland. What’s the secret to their longevity and success? Tepperberg and Strauss aren’t simply savvy nightlife operators; they’re savvy marketers who happen to own nightclubs. They’ve mastered the notion of marketing midnight, creating an overwhelming demand for a wholly intangible product: late-night fun.
Their latest creation, Marquee Nightclub and Dayclub at the Cosmopolitan Hotel in Las Vegas — the highly anticipated $3.9 billion luxury hotel and casino opening Dec. 15 — will debut with a wild New Year’s Eve blowout. The 60,000-square-foot venue is rumored to have cost $50 million to develop (funding came from Deutsche Bank). Given its size, Marquee Las Vegas will unofficially receive the title of the biggest nightclub in America. “We haven’t heard of anything being larger,” Strauss says, flashing a grin that reveals more than a sliver of pride at the accomplishment.
While it takes an entire team of dedicated partners at Strategic Group Hospitality/The Tao Group — Rich Wolf, Marc Packer, Lou Abin and Seth Rodsky — to oversee the portfolio of venues that includes Marquee New York, TAO New York, TAO Las Vegas, LAVO Las Vegas, LAVO New York, Avenue in NYC and now Marquee Las Vegas, Tepperberg, Strauss and their veteran partners stand at the helm of an expansive nightlife machine that now plays in multiple markets and shows no signs of slowing anytime soon. The twosome sat with Nightclub & Bar to reveal their plans for Marquee at the Cosmopolitan, how a massive deal like this happens during an economic crunch, what opening the largest club in America means to our country, how they continue to post impressive returns on their investors’ dollars and more.
NCB: Let’s start with the latest Vegas project. Tell me about Marquee Nightclub and Dayclub at the Cosmopolitan.
Tepperberg: It’s three rooms, essentially. The main room has a big circular dance floor and coliseum-style banquet seating, which is tiered so that one section is above the next. Everyone has a great view of the DJ, which is the focal point of the room, given the stage. The second room is called the Boom Box, and it’s smaller, has a real urban sensibility — etched artwork and beautiful bars with a DJ booth sunken into one. There are a lot of glass windows in there, out of which you can see the Strip. The third room is called the Library, which is designed to feel like someone’s living room. It’s on the mezzanine level, overlooking the main room. It has a fireplace, a pool table and a cool British glam-rock feel to it. It’s a total lounge.
Strauss: Then there’s the pool and dayclub portion to the space. It’s a massive space, with numerous cabanas — each with its own private dipping/plunge pool out front. There’s a gaming area, raised bar area and a fantastic DJ setup. There are also 10 bungalows, which are really three-story hotel rooms.
Tepperberg: Guests can spend the night in there if they can get one [laughs]. Each has a hot tub on the roof and it’s really the ultimate Vegas hotel room. It’s poolside and club adjacent, so you can walk from the party to your room in a few feet.
NCB: What’s the coolest innovation about Marquee at the Cosmopolitan?
Strauss: We are building a multimillion-dollar festival-esque DJ booth in the main room. It’s a fully interactive light and sound stage, so it’s no longer just a DJ spinning or a person performing; it’s an entire show. The stage is 40 feet high, with multiple levels of LED walls and video components. It even has hydraulics so we can float it out over the crowd and move it around. That’s never been done before.
NCB: Why did you decide to name this venue Marquee?
Tepperberg: We needed a name that was bold; that evoked the thoughts and image of a big, cosmopolitan — no pun intended — nightclub experience. Having owned Marquee NY for seven years, we couldn’t think of a better name to exemplify a soon-to-be-famous, world-class nightclub. We’ve had nearly a decade of success in New York, so it’s time to bring it to Vegas.
NCB: What are the challenges presented by a project this big?
Tepperberg: One of the biggest will be how you move traffic and thousands of people in and out of a venue this size with grace and ease. And there’s always going to be a weather issue because half the venue is outside. It’s not easy to plan for when you have 7,000 people — half being around your pool — and the weather drops 50 degrees and you have to fit them all inside. Or vice versa. Managing the seasonality in Vegas will likely be the biggest challenge.
NCB: How do you formulate a plan for that?
Tepperberg: Those are made up as you go. [laughs]
NCB: Here’s the burning question: Why build such an expensive, large venue during a recession?
Tepperberg: The nightlife market in Vegas is booming. There may be a recession going on in other sectors of this industry, but as far as Vegas goes, there’s no recession there. People are flocking to Vegas [clubs]; every place is packed. And they’re spending money. Now’s the exact right time to do something like this.
NCB: What does opening the largest club in America mean to the country?
Strauss: We’re fortunate to have [Deutsche] bank as our partner, willing to invest in nightlife and willing to create an attraction that the country and the world should see. That it’s happening in Las Vegas — that there’s such a confidence to build something of this grandiose stature — really puts the stamp on Vegas as the nightlife capital of the world.
NCB: How do you continue to pack your houses and put up great numbers despite the economy?
Strauss: Mainly through [guest] experience and through commitment to service. But having the most relevant and new content all while pushing the envelope and being plugged into what the demographic is looking for is also important. Keep it fresh and people will want to come back.
NCB: Is nightlife recession-proof?
Strauss: As the recession changes, there are adjustments you make to pricing points, but people are always looking for the nightlife experience. Owners have to adapt to the recession, but now I’m feeling less of a fear [of the economy] and more of a sense of confidence in our clients’ [spending habits]. It’s been a very steady but slow increase from month to month. We’re also seeing an upswing in corporate and private events in our venues, which had been negatively affected for the last two years.
NCB: What do your partners in Strategic Group Hospitality and Tao Group bring to the table?
Tepperberg: Lou [Abin], Marc [Packer], Rich [Wolf] and Seth [Rodsky] are great partners. We’re a well-rounded team, and we all play different positions. When you have the size and scope of the properties we have, it’s got to be a team sport not a solo endeavor.
NCB: How have your roles in SG Hospitality changed as the company grows and you have more and more venues under your belt, particularly ones as large as Marquee at the Cosmopolitan?
Strauss: We’re delegating more. We’ve had to empower and mentor a lot more people and create an infrastructure of different layers of management. Despite the delegation, we’re still very hands on. We’re at one of our venues six nights a week. Every partner has their strengths — some are better at certain things than others — but generally we each touch all facets of the business. No one partner sticks only to marketing, or just to helping out making sure the kitchen is running smoothly or showing someone how to do a door properly, etc. We all do a little bit of each discipline.
NCB: What do you know now that you wish you could go back and tell your younger self to do differently?
Strauss: I think when I was younger, we were really top-line focused. What mattered was bringing in the business, and we didn’t look at the bottom line as much. As we matured, I think we found a nice balance between managing the house and balancing the top line and bottom line of the financial slope. So I’d have fixed that earlier.
Tepperberg: In 2003, all I did was work, and I’ve learned as I’ve grown up that personal time is important as well. You need to take a vacation, even if it’s to Ibiza, and take days off every once in a while, even if you’re still on your BlackBerry. I didn’t take a day off between 2003 and 2008, so I’d tell my younger self to learn to balance the personal life with the professional one.
NCB: What does the future of nightlife look like?
Tepperberg: Marquee, LAVO and TAO [laughs]. Trend-wise, you’re going to see clubs that opened in the beginning of the nightlife boom five or six years ago being remodeled and reopened. A lot of original products are being retooled. In New York and in Las Vegas, nightclubs coming on line are being revamped and stronger than ever. When the recession hit, operators were able to buy them cheap and are just waiting for the right time to reopen them, which is now.
NCB: What’s next for you two and SG Hospitality? How do you top the biggest club in America?
Strauss: For us, it’s about building the brands, such as TAO, Marquee, Avenue, LAVO and our Artichoke Basilles Pizzeria & Bar concept that we recently launched with Francis Garcia and Sal Basille. We want to create more brand extensions of those successes.
Tepperberg: Maybe opening the biggest restaurant in America? Or building the biggest club in the world? [smiles broadly]
NCB: You don’t have a venue outside of the U.S. Will that be changing in the near future?
Strauss: We have offers in a few countries, and we have one or two pending deals abroad, but nothing we can announce just yet. We’re always looking.
NCB: What are your ultimate goals? Where do you see yourself in 10 years? Still at the owners’ table of your hottest venue?
Strauss: The goal would be to expand the brands and develop enough senior-level people so that we can grow properly. I’m sure we’ll still be at the owners’ table but just not as often as we are now.
NCB: So you want to continue to stay in nightlife for the foreseeable future?
Strauss: I’ve been doing this since my sophomore year of high school...I don’t know what else I would be doing if it wasn’t this. NCB
Jason Strauss and Noah Tepperberg may run one of the largest nightlife enterprises in the nation, but they started small and still apply the basic rules of smart operations. Here are their tips for surviving in today’s tough market for any nightlife pro:
• Manage all aspects of your club closely. Don’t assume the bar is running smoothly because you have a great manager overseeing it. Get in there regularly, understand what’s going on and tweak as you see fit; lots of dollars can be lost behind the bar and in the stock room. Watch how the door is run, making sure guests are handled efficiently and with a high level of hospitality.
• Know your customer, and constantly refine your space, drink menu, music, service style and promotions to attract and keep them in the house.
• Watch the top line closely and the bottom line closer. Be strategic in how you drive traffic into the club, and then be smart in how you manage costs — everything from staffing to inventory to energy costs.
• Focus on service and experience. The nightlife customer expects both, so consistently deliver better than your competition.
• Be proactive. Keep an eye on market trends, from consumer spending habits to real estate opportunities, so you can stay ahead of the game and the competition.