Photo Credit: Experience Scottsdale
Diversification is a major key for any corporation that gets to a certain size; being solely reliant on one stream of business represents a major business threat. So when Caesar’s, the company well known for its hotel/casino in Las Vegas, started a hotel and restaurant in Scottsdale but without gaming facilities, the first of its kind anywhere, it seemed like a concerted, bold move to diversify away from gaming.
Well the market has spoken…with silence. While the hotel opened up a mere 8 months ago, it is already acknowledging failure, and recently announced that it will instead rebrand and be folded into the Hilton brand of hotels, a stunningly fast admission of failure and perhaps a larger sign of the times.
The thought process behind the idea had some degree of merit; people that had rewards points with Caesar’s could use their points on this hotel, and presumably some tourists would also be drawn to the name and decide to book their accommodations there. Granted, that assumption has some clear flaws…after all, the Caesar’s brand is not a sexy, flashy one, at least not to the degree that would be expected to make a splash in Scottsdale.
These days, the word “Caesar’s” is often followed by “Sportsbook”, so to perhaps unwittingly capitalize on that name ID but then have visitors almost certainly be disappointed by a lack of gaming seems like the sort of slow motion train wreck that should have been anticipated by smart leadership.
Plus…it’s 2024. Sportsbooks are legal in Arizona, let alone the presence of legitimate gaming venues on reservations mere miles away. Sports betting was a $10.9 billion industry last year, with Americans waging $120 billion in sports during 2023. It is dominating all of America, with corporations with DraftKings showing commercials on every screen and sponsoring related content everywhere. Why would they NOT want to take advantage of at least sports betting, and draw from their core capabilities as a result? Frankly, it makes absolutely no sense.
While wanting to diversify away from gaming certainly makes sense, the thinking behind this particular move seemed thoughtless, an overestimation of the power of a brand name and an overreliance on that brand power. People want to stay at a Hilton hotel, not a Caesar’s without any place to bet. For the sake of the Caesar’s corporate board, hopefully this attempt at diversification in Scottsdale was an isolated mistake, and not the first domino.