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Low Hotel Rates Key to Attracting First-Timers to Las Vegas, Survey Says

Las Vegas is fast becoming a mecca for bargain hunters as Americans look for less expensive vacations.

The lure of discounts is Las Vegas' No. 1 means of attracting all-important first-time visitors, a survey by MRC Group Research Institute found last week.

Of the 589 respondents in the survey, 37 percent said discounted hotel room rates were the key to their deciding to vacation here.

"(Room rate) discounts clearly are important in drawing first-time visitors. That's the primary factor in their vacation decision-making," said Jim Medick, chief executive officer of the MRC Group, Nevada's largest market research and public polling firm.

Also, of the visitors who came to Las Vegas by air, 27 percent said getting discounted tickets was their primary reason for planning to vacation here, the survey found.

"Airfare is second. (New visitors) pick their hotel on the basis of bargains. Then they want to get here cheap," Medick said.

The two factors together mean we're attracting bargain hunters. People are coming here looking for the discounts," he said.

In addition, 20 percent of first-time visitors and 32 percent of repeat visitors surveyed said special casino promotions had a "significant impact" on their decisions to vacation in Las Vegas.

The bargain hunting underscores a critical factor in the appeal of Las Vegas, said Las Vegas professor and gambling expert Bill Thompson.

"Stay anywhere else in the U.S. and room rates are approximately double across the board. We have Super 8 rates for good resorts on the Strip," he said.

Gaming experts said the industry's success in converting first-time visitors into repeat customers represents a real strength in competing with other destinations.

Room rate and airline fare discounting not only fills room, but also builds the base for prospective repeat visitors, Thompson said.

The bargains will keep first-time visitors coming to Las Vegas, and that's good as long as we can keep half of them coming back and 85 percent of them trying the casinos, Thompson said

Thirty percent of the people on the Strip are first-time visitors, of whom 54 percent are sufficiently satisfied with the experience that they say they will come back at least once, the survey show.

At the Las Vegas Convention and Visitor Authority, research director Kevin Bagger said Las Vegas "is perceived as a value destination, they get a lot for their money here."

"Beyond Las Vegas, people right now are very value-conscious in their travel decisions, whether they're coming to upscale properties or value-oriented properties," he said.

MGM Mirage spokesman Alan Feldman said the strategy of building in perceived value "with appropriate room rates" has been a key for Las Vegas and his company.

"But converting people to repeat visitors (once they come here) is not a function of any one company, but all of us together. There isn't another city in the world as successful at it because of the value they feel they receive after they get here," he said.

Discounted hotel rates have been popular tools for filling rooms on the Strip so far this year.

Through the July 4 weekend, the average rate for midweek rooms booked three weeks in advance or more has been below last year's rate 14 out of 28 weeks and the average rate for weekend rooms has been down 15 out of 28 weeks, data collected by Fulcrum Global Partners, an independent Wall Street investment research firm show.

"We believe that recent rates have benefited from travelers substituting overseas vacations for trips to domestic locations, but Las Vegas still represents a good value proposition for budget conscious travelers," Fulcrum gaming analyst Joe Greff said.

Heading into summer, however, demand for Strip rooms and the rates they command are firming up and discounts are less common.

For the week of July 7, average three-week advance room rates on the Strip increased to $129, up 10 percent from the year before, the most recent data collected by Deutsche Bank showed. "We are encouraged to see some stabilizing of prices in the middle of the market for the past three weeks, since we estimate more than 50 percent of the Las Vegas Strip hotel room supply is in this segment," Deutsche Bank analyst Marc Falcone said.

The MRC survey polled 589 respondents at its research facility in the Grand Canal Shoppes of The Venetian from June 6-10.

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