Pay more, win less: the plan to make the Las Vegas Strip a more exclusive experience

According to a Wall Street Journal (WSJ) story, companies in Las Vegas are trying to shift the balance of visitors in the Strip by making it more challenging to play and win at their casinos.

The media outlet explained that the casinos are doing this by installing more roulette tables that make it more difficult to win and increasing the odds for a payout in blackjack.

The article continued explaining that playing certain table games is also more expensive. The companies are shifting the balance toward the house by making these subtle changes.

However, the objective is not simply to win more money in each bet. It is also a gatekeeping strategy to upscale tourism in the Strip and make it a more exclusive experience.

According to the Wall Street Journal, the efforts to implement this strategy started before the pandemic, but companies are doubling down now.

"You're kicking out the lowest end. "I see no reason that that needs to stop or would stop," Caesars Entertainment CEO Tom Reeg explained to WSJ analysts, according to Bussines Insider.

The Strip also had record revenues last year, with $8.28 billion, explained Forbes. Casinos across Nevada brought in $14.8 billion, despite having fewer visitors than in 2019.

According to Forbes, 38.8 million people visited the city in 2022, down nearly 9% from 2019. However, the number is up 20.5% since 2021.

The Strip also has fewer workers, according to WSJ. Casinos are shutting down table games in favor of electronic ones. Forbes said Slot revenue comprised 67.4% of total gaming wins in 2022.

The strategy is working. 2022 started a higher revenue tendency for Las Vegas. Fortune said they had $1 billion in statewide revenue every month.

The magazine cited Michael Lawton, a senior economic analyst with the Nevada Gaming Control Board, who believes that a billion earnings are the new baseline for monthly earnings.

According to Fortune, Lawton said that convention attendance, special events, and sports accounted for 95% of the gambling revenue 2022.

Fortune cites examples like K-pop sensation BTS or Taylor Swift as high-end shows that could attract a more exclusive audience to the Strip and, ultimately, the casinos.

Sports have also brought great opportunities. An example is a new MLB stadium after the Athletics agreed to move to the city. It is Oakland's second time losing a team to Las Vegas.

NBA star LeBron James has also expressed interest in locating a team in Las Vegas earlier this year, said Fortune.

But the hype may be temporary. According to Forbes, a January memo by Fitch Ratings said the gaming industry will likely experience a "demand pullback" when the economy cools down after the Fed's interest rate increase.