Las Vegas firm’s alliance with Indian casino signals new era

By Liz Benston

Tuesday, March 25, 2003 | 10:59 a.m.

Over the past two years, executives at some of the largest casinos on the Las Vegas Strip had beaten a path to the door of Troy Simpson, executive director of casino marketing at Barona Valley Ranch Resort & Casino near San Diego.

Strip properties -- defeated in their efforts to fend off the legalization of Las Vegas-style tribal casinos in California a few years earlier -- recognized the growing force of Indian casinos across the border and decided to try and strike up a marketing alliance with the competition.

"They were looking for us to funnel our players into their casinos, but there wasn't a whole lot of upside for us," said Simpson, a former marketing guru for Las Vegas-based Harrah's Entertainment Inc. in Lake Tahoe and Tunica, Miss.

Until now, that is.

Starting next month, Barona will launch a long-term marketing partnership with Station Casinos Inc.'s Sunset Station casino in Henderson that will involve "sharing" their best players, cross-marketing their casinos and other initiatives.

The partnership is unheard of in the ultra-competitive casino business, where properties -- even those owned by the same company -- protect their customer lists with utmost care and compete tooth and nail for new gamblers, observers say.

"This is counter-intuitive to the old-school way of thinking," Simpson said. "But we see it as a way to complement each other and not to compete with each other."

The partnership is a no-brainer, said Max Rubin, the Las Vegas author of "Comp City" and a consultant for Barona and other properties.

"The writing is on the wall as far as what is happening in California," he said. "A lot of people are staying at home to play now. We're also creating a whole new population of gamers."

"(Las Vegans) tend to vacation in San Diego anyway," he said. And San Diego residents also represent a large feeder market for Las Vegas.

Sunset Station's clientele of well-heeled gamblers aged 40-plus is also a good match for Barona, he added.

The partnership may prompt Las Vegas companies that have been reluctant to share customer names to rethink the way they do business, he said.

"It's never been done. But it's the smart thing to do and it's the right thing to do."

The partnership officially begins next month when 50 frequent gamblers at Sunset Station will receive an all-expenses-paid weekend at Barona worth about $1,000. Early this month, Sunset Station kicked off a slot tournament for players in the top two tiers of the company's Boarding Pass slot club loyalty card program. Players who gambled a certain amount during that time became eligible for a drawing that was held Sunday to select the 50 winners.

Several hundred people gathered at Sunset Station Sunday to participate in the drawing and watch a video presentation of the Barona resort.

"To most casino operators, that would make them shudder," Simpson said.

Sometime over the next few months, Barona will reciprocate by sending off 50 of its valued gamblers for a free weekend at Sunset Station.

Selecting Station Casinos -- Las Vegas' dominant operator of off-Strip, neighborhood casinos -- proved to be a better fit for Barona than the city's Strip giants, he said.

Both properties have local reach and emphasize the gambling experience over other amenities such as shopping and entertainment, he said.

"They are the pre-eminent locals property in Las Vegas and we are the pre-eminent gaming property in Southern California."

About 35 minutes from downtown San Diego, the resort is owned and operated by the Barona tribe and features 397 hotel rooms, 2,000 slot machines, eight restaurants, an 18-hole golf course and a convention center.

The hotel's debut in January added a different dimension to the resort and presented the need to market the property beyond its typical mix of local visitors, Simpson said.

Local Las Vegans offer a significant potential market for the hotel, along with people from nearby Los Angeles, Orange County and Southern Arizona, he said.

"People (from Las Vegas) go down to San Diego to get a reprieve from the heat. The local in Las Vegas tends to be a gamer" who gravitates toward casinos, he added. "When the Las Vegan visits Southern California, we will be their choice stop."

Station Casinos, like its Strip counterparts, initiated talks with Barona about cross-marketing opportunities.

The partnership is a recognition that California's tribal casinos are growing in scope and popularity, Station Casinos spokeswoman Lesley Pittman said.

"This is a way for us to capture that California visitor who might not go off the Strip," Pittman said.

Marketing deals between separately owned and operated casinos are rare. Deals with Indian tribes also are unusual.

Station Casinos is one of only two major Las Vegas gaming companies that are managing casinos for Indian tribes. The company expects to open Thunder Valley Casino near Sacramento in June for the United Auburn Indian Community. Harrah's also has a contract with the Rincon tribe to manage the Harrah's Rincon Casino & Resort near San Diego.

Station Casinos says it aims to grab a piece of a growing market that would otherwise go to a non-Nevada company, meaning less money for future Nevada projects.

Likewise, Station's Las Vegas-area properties will ultimately benefit from the partnership with Barona, Pittman said.

"I think it puts us at a competitive advantage," she said.

The company also expects to initiate other promotions with its Thunder Valley casino, she said, though plans won't likely be formulated until the property is open.

The arrangement works similar to a cross-marketing promotion used for years at Harrah's. The company's slot club loyalty card program, Total Rewards, allows frequent gamblers to rack up points for freebies and other perks across all of its properties nationwide.

Barona and Station will consider other marketing plans that may include sharing billboard space, sending out direct mail pieces and even dispensing complimentaries to each others' customers, Simpson said.

The alliance isn't a sign that the resort is hurting for business, he said.

"The ball has always been in our court," he said.

"When you come here on a weekend and you see 1,850 machines occupied and the other 150 machines not occupied because people are eating in the restaurant ... you know that business is good. We've got a backyard with 3 million people in it."

Still, he said, the partnership is part of a new marketing push to position Barona as a destination resort on par with Vegas' best.

"We really do have a phenomenal property here and we need to increase our exposure. We want to continue to advance and really be seen worldwide."