CEO Michael Etess Has Controlled Mohegan Sun Since 2004
Mohegan Sun lost out on the Massachusetts casino license that might have turned around the beleagured tribal gaming enterprise’s fortunes. The Mohegan Tribe had partner with Suffolk Downs to bring a Boston-area casino to Revere, Massachusetts, but their $900 million proposal eventually lost to the Wynn Resorts’ $1.6 billion development, set to be built along the Mystic River in Everett.
Suffolk Downs closed the 70+ year old horsetrack when news came down they would not be able to open a casino. Mohegan Sun, on the other hand, began working on other contingencies. Faced with a major loss of revenues over the past ten years–Connecticut now draws about $120 million in taxes from Mohegan Sun per year, when it once collected $430 million. The tribe has decided no one magic solution is going to work. Instead a variety of good ideas will help build for the future.
Mohegan Sun Partnering with Foxwoods?
Mitchell Etess, the CEO of the Mohegan Gaming Authority, said his tribe might partner with its longtime rival to counter what is going on north of the border with MGM Resorts’ Springfield development. One suggestion is to have the Mohegan and Mashantucket tribes partner on a smaller slots casino somewhere near the Connecticut/Massachusetts border, so MGM casino in Springfield won’t steal so many customers from the tribal casinos.
It is estimated that as many as one-third of the customers at the MGM Springfield might be residents of Springfield. If so, then it’s incumbent upon the tribal gaming authorities to work with the state to stop that exodus of gamers. Etess said, “From the business side, I can certainly visualize a legislative solution that would permit some sort of expanded gaming, maybe even if it was just slots somewhere near the Massachusetts border that would protect the tax revenues of Connecticut.”
Mohegan Sun is also diversifying the integrated experience it provides customers by offering more off-site restaurants nearby. At present, the tribe hopes to open up to 15 more restaurants. Joseph Smith, the Mohegan Tribe’s manager of tribal communications, explained the strategy. He said, “The tribe is branching out into things that aren’t about gaming.”
One example is the November 2014 opening of Smashburger in nearby Waterford. Smashburger is a chain with locations in Connecticut, Rhode Island, and Massachusetts. The idea is to offer casino visitors more options than McDonald’s and Burger King.
Tom Ryan, founder of Smashburger, explained his chain’s philosophy, saying, “We want to become the Starbucks of burgers.” Given the seemingly ubiquitous nature of Starbucks, that sounds ambitious, but it shows the burger chain is ambitious and offers a different kind of dining experience from the traditional burger joints.
Meanwhile, the Mohegan Smashburger franchise is a way the tribe can use their casino profits to diversify their economic outlook. The tribe was burned when it had a massive casino expansion just prior to the onset 2008 and 2009 Global Recession. In light of that move, the idea of building their future through something besides gambling is a good idea.
Groupsize Junkets to Mohegan Sun
One way Mohegan Sun is trying to change its trends is partnering with group booking engine, Groupsize GBE. Groupsize should help the casino direct more corporate retreats and small leisure groups to their gaming destination. Gaming junkets are a good way to get a steady stream of high-value customers. Look at the Sands Bethlehem’s 50 bus visits a week from New York City to see how such planned trips can affect the bottom line.
Alisha Cadoret, the Director of Leisure and Corporate Strategic Marketing at Mohegan Sun Casino, explained how the casino’s deal with Groupsize works. Cadoret said, “We selected the Groupize GBE so that we could capture the growing demand for small leisure and corporate retreat groups visiting our website. The market potential for special events, parties and social groups represents an enormous revenue opportunity, and we recognized that the ‘sweet spot’ for offering preferential group pricing and online booking tools is four rooms or more.”
Beaubien: “Group Solutions”
Charles de Gaspe Beaubien, CEO of Groupize, gave his own strong approval to the partnership. “We are proud to be working with an organization that has such an extraordinary presence in the casino and tribal gaming industry. We are confident that our group solutions will help them achieve their small and leisure group revenue and operational objectives while helping them deliver the world class service their guests expect.”
With new ideas in place, Mohegan Sun has a chance to turn around a trend that’s been plaguing it for two calendar years.
