Perhaps you are one of the 40 million people who visited Las Vegas last year, or one of the hundreds of millions that has been there in the past decade. If you are at all entrepreneurial, you were probably captivated by the incredible transfer of money that happens each and every day on the strip and throughout the city. From humble farming beginnings in the middle of the desert to its present day oasis, Las Vegas captures the imagination and money of people from all over the world who are hoping for a life of fame or fortune.
Most of us will never have a business based on gambling or prostitution so what could we learn from a city who has a history that lives up to its name of Sin City? The fact is that most business owners could learn a thing or two from the city of Las Vegas.
Build on your strengths: In the 1920s and 30s, gambling was starting to draw people to the Nevada desert and the little town of Las Vegas. With the commencement of the building of the Hoover Dam in the 1930s, the government saw that workers were spending their earnings in Las Vegas and seized the opportunity to draw revenues from the growing gambling business. The government legalized gambling and licenced prostitution in the state in order to tax the proceeds. As its fame grew and tourist flocked to the desert city, accommodation expanded to meet the needs. It's rare now that a hotel, or for that matter a gas station in Las Vegas or its surrounding community, doesn't have an attached casino or at least a few slot machines.
Diversify in order to expand: Not everybody gambles, but Las Vegas has become addicted to tourism and has expanded to meet the needs of the tourists. Entrepreneurs recognized that its place in history didn't need to be limited by the constraints of its seedy reputation and developed a cultural aspect that has stood the test of time. Made famous by the likes of Dean Martin and Frank Sinatra in the 1950s, Vegas has drawn huge crowds with a slew of shows and concerts. Not one to miss out on the chance to attract even more tourists, despite the risk of radiation poisoning while the government tested nuclear bombs in the Nevada desert, the community invited travellers to stay and watch the tests and lived up to its nickname of Atomic City. In more recent years, Las Vegas has captured the attention of wedding planners, conventions and sports tournament organizers to facilitate the introduction of even more reasons to visit Vegas. Hotels are designed with fantastic budgets and imagination of themes to capture your attention and draw you back year after year.
Increase your margins: For many years Vegas was known for its free drinks and cheap buffets in order to attract gamblers to eat drink and open their wallets. Those days are long gone. Realizing that there was money to be made in food and drink, the cost of a decent meal has skyrocketed. Whether you are on the casino floor or just cruising down the strip, drinks are no longer cheap, marijuana is everywhere, and the invitation to party at an expensive club or take in a show for several hundred dollars a seat is made to grow to the size of your credit card debt. Unless you are in Las Vegas on a weekday, most hotel rooms will cost you hundreds of dollars on The Strip. This has changed from years ago when travel packages including a flight across the country was considered cheap. Realizing that they were leaving money on the table, the business community has taken steps over the past 25 years to increase margins and profit more from their tourism jackpot. Hotel costs are no longer limited to your room charge and the $10 bottles of water. At almost every hotel there is a "resort fee." Upon checking out, I encountered a fee of $40 per day. When I asked what it was for, I was told it helped pay for the management of the hotel. I estimated that the hotel I stayed at generated tens of thousands of dollars each and every day simply by adding the "resort fee"! Imagine if retailers could add a "location fee" to the final bill after customers bought a few items. Margins would increase but probably drive more consumers to the internet.
Las Vegas has found ways to monetize almost every minute of your visit and extract money you haven't even made from your wallet. They have sold a population of travelers on the idea that theirs is "THE" destination and captured the imagination of entrepreneurs who have been willing to assist the municipality in continuing its growth into the desert.
As business owners we can't gamble on our future. We can learn to think differently, however, and create an experience that draws our customers back, year after year, month after month and day after day.
-- Dave Fuller, MBA, is an award-winning business coach and the author of the book Profit Yourself Healthy. Download your winning copy of the book at www.profityourselfhealthy/free or email firstname.lastname@example.org.