Crown Resorts is working to reposition itself in the Australian domestic market and widen its customer base as the company battles against the dual challenges of a tightened regulatory environment and reduced discretionary spending, according to CEO Ciarán Carruthers.
In an interview with Sky News, Carruthers said Crown was “not immune” to the impact of inflationary pressures in Australia, which have included 13 interest rate rises over the past 18 months. This had particularly impacted the company’s Melbourne and Sydney properties, he explained, with Crown responding by altering its business model to focus on appealing to the domestic mass market.
“We’ve done a lot of work in and around rehabilitating our brand,” Carruthers said in the televised interview. “We’ve clearly had a bad couple of years in terms of peoples’ perceptions of who we are and what we represent, so [we are] making it much clearer that we’re so much more than just the casino. We are restaurants, we’re bars, we’re entertainment, live music, shows, wonderful spa and wellness and great hotel stays across all of our states.
“The totality of the entertainment offering means that we can and should be reaching out to a much wider audience. It broadens the share of market that we have available to us by being much more cognizant of the different budget levels – reaching out to people [to say] we’re not just for the high rollers, we’re not just for the VIPs, but for people who want to come through and enjoy great casual dining, go to a bar, go to well-priced shows.
“Our events strategy in terms of driving partnerships with major events – Taylor Swift was huge one but also our engagement with Formula One, the Australian Open and the recently announced UFC partnership. By bringing these events, we can create experiences on our property or create experiences off our property within our communities that being a guest of ours allows you to be entertained by. That broadens the market, makes people more excited again about coming back to our property and does so at price points that meet a much wider range of people.”
Repositioning has been a particular focus, Carruthers said, at Crown Sydney – an AU$2.2 billion (US$1.6 billion) integrated resort originally planned to target the Chinese VIP market.
Acknowledging that this VIP model is one that has all but disappeared in most markets globally, Crown’s CEO said it was now the company’s job to make the Australian public aware of what Crown Sydney has to offer the local community.
“We have some of the best bars and restaurants in the city,” he said, “but we’re also making sure the casino model itself reaches a wider range of people, that people understand you don’t have to be a VIP to gamble through here.”
Crown’s recent restructuring, which has seen a number of job losses across the business and the casino operating hours in Sydney reduced, is about “managing our cost structure to ensure that we can meet our compliance and regulatory obligations and at the same time provide the kind of fun and entertainment our guests expect,” he explained.
While Crown has now emerged from the other side of the regulatory inquiries that have battered its reputation – in recent months winning back its casino license for both Crown Melbourne and Crown Sydney – Carruthers outlined his hope that regulators can also find a balance between enforcing compliance with stricter anti-money laundering and responsible gambling requirements, and allowing for a smoother guest experience than is currently being provided.
In particular, the former Wynn Macau executive pointed to a recent increase in reports of illegal gambling dens popping up across the country as evidence that some players were frustrated by their current experiences in Australia’s casinos.
“There is a necessity, and I do believe this will happen in time, to normalize the whole concept of responsible gaming: coming through and playing in an environment where you are being entertained but doing so in a safe manner where you’re being engaged with by team members and executives of the casino,” he said. “Until that time, a lot of the new regulations, the new restrictions, are having an impact on the guest experience – what they need to go through to sign up, the information they need to provide, the ongoing engagement from team members with them while they’re enjoying the experience.
“If there’s an avenue for them to enjoy that experience where they don’t have to go through any of that, then potentially that’s where some people are moving to. So that becomes a significant issue and we are seeing an increased number of reports about illegal casinos opening up across the country.
“What’s important, and I know the regulators are very focused on this, is working on that balance to ensure that the regulated industry is regulated appropriately but not to the point of potentially forcing guests – not necessarily villainous guests but just guests who don’t want those hurdles and that friction in the guest experience – to move elsewhere to an unregulated environment.”
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