MGM strikes marketing deal with L.A. nightclub operator

By Liz Benston

Thursday, Jan. 6, 2011 | 7:17 p.m.

MGM Resorts International is finalizing a marketing deal with Los Angeles-based SBE that will allow loyalty club members to redeem rewards at MGM-owned properties based on expenditures at select SBE venues, and vice versa, an MGM Resorts executive said Wednesday.

SBE owns hotels, nightclubs and restaurants frequented by celebrities and scenesters, including Hyde and The Abbey in Los Angeles. CEO Sam Nazarian also owns the Sahara hotel-casino in Las Vegas.

The marketing arrangement involving MGM’s revamped loyalty program, M Life, also would recognize MGM rewards club members at SBE venues, entitling them to nightclub perks and the like, MGM Resorts Chief Marketing Officer Bill Hornbuckle said.

MGM Resorts has created a marketing team to pursue additional partnerships with hospitality and tourism companies seeking an entry point for their customers on the Strip. Potential partners could include foreign or U.S. casino companies that don’t have a Las Vegas casino as well as airlines, Hornbuckle said.

MGM, which generates about 60 percent of its revenue from nongambling amenities, hopes such partnerships will boost customer traffic and spending among those with similar interests.

“This is a lifestyle program that extends beyond what I can do at a slot machine,” Hornbuckle said. “If I’m living in L.A., I’ll be able to pick up the phone, call the M Life concierge and they can get me into the hottest club in L.A. because I’m recognized in Las Vegas.”

MGM’s loyalty program will continue to offer perks for gamblers but will begin rewarding customers for non-gambling expenditures, such as dining and entertainment, later this year.

Historically, Las Vegas casinos have been averse to taking risks such as engaging in marketing partnerships with potential competitors, said Max Rubin, a casino consultant and author of the gambler’s guide “Comp City.” The recession changed that, he said, by forcing companies to get more creative with marketing.