LVCVA focusing marketing, ad strategy on ‘core’ visitors

By Richard N. Velotta

Wednesday, Dec. 15, 2010 | 2:05 a.m.

The Las Vegas Convention and Visitors Authority is revamping its marketing and advertising strategy to focus on attracting the likeliest visitors in a post-recession economy.

Board members heard a report from a team of marketing experts Tuesday that said the destination should focus its attention on a core base of steady Las Vegas customers and another group that will need some persuasion to choose Las Vegas over another resort destination.

New technologies and social media should enable the LVCVA to zero in on those different market segments, they said.

The plan is a departure from previous strategies that gave more consideration to the demographics of potential visitors and where they come from.

The new strategy was generated following research into how consumers have changed since the Great Recession.

The market segmentation study, developed by LVCVA executives, Las Vegas-based advertising consultant R&R Partners and Heart+Mind Strategies of Washington, is based on research that determined 38 percent of the market are core customers who love Las Vegas, 41 percent are in the “persuade and convince” group and 21 percent are uninvolved or disinterested.

The new strategy will be to appeal to the “core” and “persuade” customers and devote no resources to others.

While much of the LVCVA’s past marketing efforts have targeted specific demographic groups in particular regions of the United States, the “core” and “persuade” targets are all across the country but can be reached with target marketing enabled by new technologies.

The “core” customer group are “zealots” and “wannabes” who are passionate about Las Vegas, seek out the multiple experiences the destination has to offer, have a positive economic outlook, are trendsetters and are looking for excitement and surprises.

The “persuade” group has achieved the American dream but wants to escape, has a more conservative economic outlook and is looking for value, but lacks an understanding about Las Vegas beyond gaming.

The board didn’t have any TV commercials or advertising messages to show board members, instead explaining the concept of the new strategy.

“There are some new rules to play by,” said Billy Vassiliadis, the head of R&R Partners. “Las Vegas travelers are overwhelmingly defined by experience and not just geography and demographics.”

The potential market is vast, with an estimated 45 million people comprising the “persuade” group and 42.1 million in the “core customer” segment.

Michael Dabadie, president and managing partner of Hearts+Minds, explained that the strategy was developed following 10,000 online interviews and 60 in-person interviews with consumers over the age of 21 in Los Angeles, Dallas, Chicago and Boston. The LVCVA hopes to use the content of those interviews to develop advertising that will appeal to the two target segments.

The LVCVA plans to strike a balance on ads appealing to the “core” and “persuade” groups and will also develop separate strategies for domestic sales, international sales and airline route development.

LVCVA President and CEO Rossi Ralenkotter said he hopes to grow the international market to between 15 and 25 percent of all Las Vegas visitors. Possibly the most difficult challenge in the strategy will be to grow airline development after several carriers developed “disciplined capacity” philosophies and cut air service to Las Vegas in their bids to become more profitable.

Las Vegas traditionally doesn’t provide as much profit to airlines as other cities, because so many customers are leisure travelers looking for low-fare bargains and not business travelers who tend to buy more expensive last-minute tickets.

In other business, the LVCVA board was told that because of improvements in the economy, the agency has lifted its employee furlough program that had been put in place as a cost-saving measure in 2009.

Representatives of the Service Employees International Union applauded the end of the furloughs, but the union was disappointed that it lost an arbitration hearing on cost-of-living increases. A binding arbitration ruling was announced last week.