Pi Attitude Zone: Self-Gratification

How Clubbing Became The New Gambling

The recession produced casualties.  One of them was the business plan that ruled Las Vegas.

Gambling was yesterday’s sure-fire pathway to profit.  Sure, the Desert City still wants you spending money on the slots and the green baize tables, but Las Vegas hotel moguls like Steve Wynn have been switching investment into night spots.  “Half of Steve’s profit comes from night clubs”, says a rival club owner. “Gambling is an amenity now”.

Las Vegas has reinvented itself before, shaking off its tacky origins  to become sophisticates’ sex’n’gambling ‘Sin City’, then cleaning up its act with family resort holidays (pirate ships, thrill rides, scale models of the Eiffel Tower).  When that business model faded, many Vegas mega-hotels bet on big-name concert entertainments (Elton John, Celine Dion...) and show spectaculars from Cirque du Soleil.  Behind it all was the steady click of betting chips and the pinging of slot machines.  Since gambling revenues plummeted with the 2008 financial crash, Vegas has turned to night clubs.  The top-grossing club in Vegas (and in the USA as a whole) is Steve Wynn’s XS.  It can bring in anything up to a million dollars a night.

What’s the attraction?  In a word, djs.  They have stage names like Tiësto, Skrillex and Afrojack.  These new sound-mixing superstars can earn a quarter of a million dollars.  Each.  Per night.  Club owners cheerfully spend millions promoting them.  They are worth it to their employers because they attract a huge and increasingly well-heeled clientele of party-goers to their aircraft-hanger-sized venues. 

Shows?  Oh, please.  Singer Shania Twain, headlining the concert theatre at Caesar’s Palace, can only hope to entertain a capacity audience of 4,300 people, a maximum of thirty times a year.  The XS club regularly hosts six to eight thousand people on a Saturday night.  The top crowd on a Labor Day weekend was over ten thousand.  Just on head-count alone, it’s no contest.  Clubs win.

Then you start counting the take over the bar.  XS earns more than 80% of its revenue from liquor sales, retailing a $45 bottle of Grey Goose vodka for six hundred bucks, a mark-up of well over 1000%.  Customers come to party.  A single well-heeled reveler will spend half a million dollars on one night’s bar-tab.

Dance clubs on the Las Vegas strip are a new thing. Resort-owners originally nixed them as an unwelcome distraction from gambling.  Now the speed with which clubs have taken over the town is nothing short of astonishing.  The line to get into the XS club is often as long as a football field. Once customers get inside, the crowd is so dense there is no room to dance.  Entertainer will.i.am says the sound offering shouldn’t be called ‘dance music’, but “look-at-the-dj-and-get-drunk music”.  You don’t go for earnest conversation.

Who are the paying customers?  Mostly the young and the beautiful from Los Angeles.  And oddly, (considering that the House Music that started all this originated in Chicago’s black night clubs), they are almost all white.  The elite djs are invariably Anglo-Saxon males.

But wait. Everything could change again.  Recent receipts imply that the club thing may have peaked already.

Pi says:  don’t be surprised if Vegas soon reinvents itself yet again.

Zone: Self-Gratification Country: USA / North America Product – Leisure