NEVADA CASINO REVENUE UP 11% IN OCTOBER 2010
In August 2010 Galaviz & Company sent out a research note to its readers stating that we believed Las Vegas' best days were ahead. We also stated in our research note that we saw reason for significant optimism for Nevada moving forward, even in the face of dire statistical evidence to the contrary. Some pundits thought our optimism for the future was ill-informed (or simply put, they thought we were nuts).
We are happy to report that we were not so nuts after all.
Today, Nevada's Gaming Control Board released gross casino gaming revenue figures for the month of October 2010 showing the State of Nevada had an 11% increase in statewide gaming revenue compared to 2009. Nearly every county in Nevada posted increases compared to 2009. Click here for the official report.
In our view, these results indicate a statewide stabilization of Nevada's casino gaming industry. Stabilization does not mean every month will be up, there will be some down months. However, the long term trajectory of both casino revenue and tourism visitation should be positive for Nevada into 2011.
LAS VEGAS STRIP CASINO REVENUE UP 16% IN OCTOBER 2010
The Las Vegas Strip had a whopping increase of 16% in October 2010 compared to 2009. Some pundits may point to certain events occurring in October, or attribute the gain to some kind of 'seasonality'. We believe an increase of 16% cannot happen for any other reason than improving macroeconomic fundamentals.
Our view is the strategies deployed by the Presidents of each property on the Las Vegas Strip have, in whole, worked. These strategies include marketing enhancements, promotions, and better uses of technology for customer relationship management. We continue to advocate the use of these strategies in this economic climate.
INCREASING TOURISTS FROM ASIA TO NEVADA
One of the interesting things about Las Vegas statistics is it's never easy to know the true international tourist visition to the city. The majority of tourists from Asia that visit Las Vegas connect through San Francisco or Los Angeles as their original point of entry. Las Vegas has several flights that touch Asia directly, but not many.
We have continued to see significant international visitation to Las Vegas, primarily from Asia. Nearly all Asian currencies have increased substantially in value against the United States dollar. Asia's economies continue to do well which ultimately translates into a positive dynamic for a global tourism destination like Las Vegas.
Moving forward, we highly recommend all properties on the Las Vegas Strip develop a true Asia strategy in which they create sophisticated inbound marketing campaigns to attract tourists from China, Singapore, Hong Kong and Korea.
MOVING FORWARD & ECONOMIC DIVERSIFICATION
Nevada (and Las Vegas) needs to economically diversify. As one of the highest ranked States for being business-friendly, Nevada must diversify into technology, medical tourism, and biotechnology research.
Zappos.com recently indicated they intend to keep their corporate HQ in Las Vegas and expanding to nearly 3,000 employees eventually. If a leading .com company like Zappos.com sees Las Vegas as a hotbed for creativity, innovation and technology, shouldn't other technology companies see the same? We think so.
There will be bumps in the road moving forward for Nevada. Casino gaming revenue figures will be volatile, but generally positive moving forward. The State government budget debate in 2011 will be difficult, to say the least.
But overall, it's a good day for Nevada.
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