What if they opened a megaresort and nobody came? That’s been the story of Revel’s initial eight months. Despite being the first new casino in Atlantic City since 2003, its revenues have hovered near the bottom of the pack since it opened – terrible news for any new casino-resort and disastrous for one with a $2.4 billion cost and in a declining market. It’s had to borrow money to cover operating expenses and has recently been grossing less than Boardwalk grind joint The Atlantic Club (the former Atlantic City Hilton). Gaming analysts thought Revel would give fancy Borgata a run for its money but instead it’s been almost a non-factor.
So, what went wrong?
Among other things, although Atlantic City is a hard-core gambling destination, Revel tried to reinvent that wheel. It’s a high-end property -- $19 for a continental breakfast -- that emphasized swimming pools (10), celebrity-chef restaurants (14), and nightclubs – and downplayed gambling as much as possible. To call this a miscalculation would be something of an understatement (just ask Las Vegas' Cosmopolitan, which has suffered along the same lines).
A two-month-long "soft opening" also backfired, allowing much of the curiosity factor to dribble away long before Memorial Day weekend’s formal debut. Initially, customers had to pay to use the parking garage. Oops! Bad move. Ditto being tight with comps. Both decisions had been reversed by Memorial Day, but the damage appears already to have been done.
Also, the marketing of the property was off-target. "Much of the pre-opening advertising was notable for making the casino seem almost an afterthought," observed the New York Times. When the Baltimore Post-Examiner sent its casino critic to check out the action at Revel, he and his crew skipped the celebrity restaurants in favor of … an in-house taco truck (at least they gave "thumbs up" to all three tacos tasted, but such coverage was hardly a PR coup). An additional $150 million has already been borrowed, partly to finish a slot parlor (Pearl) and partly to create a player-loyalty program, the Ocean Card. The year ended with several high-ranking Revel personnel getting the sack, including the marketing director. Darlene Monzo, late of Parx Casino (one of the Philadelphia-area competitors that’s been eating Atlantic City’s lunch) has been brought in to change Revel’s image. It's a tall order.
"We’ve repositioned all of the marketing," Monzo told The Press of Atlantic City. "We want to cater to all the gamblers out there, as well as make it a full-property experience … We’re looking to get in the game, go after the players." It's a casino, so catering to gamblers would seem to be a good way forward. (Again, did they learn nothing from the experience of Las Vegas' Cosmopolitan?)
Given all the problems to date, Hurricane Sandy appeared to be the last nail in Revel’s coffin. However, Monzo may have arrived just in the nick of time. Revel’s hotels and restaurants were booked to capacity for New Year’s Eve and the new marketing director was projecting 5,000 nightclub patrons and as many as 30,000 walk-in customers, calling it "a brand new opening … the launch that Revel deserved in the beginning." You have to wonder how much CEO Kevin DeSanctis, who orchestrated that bungled soft opening, winced at Monzo’s implicit slap – but he’s probably too busy going to Wall Street for bailout after bailout.
One great weekend does not a year make, but it’s a big step in the right direction for Revel. Let's hope it's the first of many.
