No Smoking Dilemma
April 10th, 2007 by Neil Raphel
Suppose you’re an operator of an Atlantic City casino. The city has just made a requirement that 75% of your casino space must be non-smoking by April 15th. Do you:• Protest loudly that the new regulations will hurt the economic base of Atlantic City by making gaming patrons go elsewhere?
• Say that you will make 100% of your gambling space smoke-free to benefit employees and customers alike?
• Hedge your bets and say that you’ll think about making one of your four casinos completely non-smoking?
Atlantic City casinos did all of the above. The Harrah’s organization, which owns four casinos there, and a couple of other casino operators said they would make 100% of the casino space smoke-free. Carlos Tolosa, Eastern Division president for Harrah’s Entertainment, said his company likely will establish non-gambling smoking lounges for its Harrah’s, Bally’s, Caesars and Showboat casinos sometime next year, pending regulatory approvals.
“We will have two or three smoking lounges at each property and then have the casino gaming space smoke free,” Tolosa said. “My long-term solution is that none of our employees will be exposed to smoke.” The Tropicana, another casino in Atlantic City, pledged to be the first casino with a completely smoke-free floor.
The Trump Organization, which owns four casinos, said they will set aside smoking areas on the casino floor for now, but are considering making one casino completely smoke free. The newest and most successful Atlantic City casino, the Borgata, said it will conform with the new law and identify smoking areas on the casino floor.
Even though the casinos would probably all prefer to maintain their current smoke-filled rooms, the new regulation is providing a textbook example on how companies employ different marketing strategies to confront new regulations.
Sure, casinos have never wanted to confront this issue. They don’t have clocks or windows in casinos – nothing to encourage a gambler to leave his or her comfy chair at the table. How many gamblers also want to smoke while losing their shirts? Why would any casino operator want to encourage a patron to leave the table to smoke? It looks like Harrah’s has thought about this, and chosen to go non-smoking anyway. The short-run benefit to the casinos of having smoking areas can have negative long-term health effects on customers and especially employees. Smoking is a health concern to employees and subjecting thousands of workers to cigarette smoke over many years is bound to create many employees with long-term health problems.
The casinos that are voluntarily going completely smoke-free include Harrah’s, the most successful casino chain in the world. If anyone can solve the marketing problem, Harrah’s can.
The solution can include:
• Informing customers of the change;
• Explaining why Harrah’s is opting for a total smoking ban.
• Giving incentives to customers to come to Atlantic City in the near future.
• Highlighting the availability of smoking lounges off the casino floor.
A marketing campaign that explains Harrah’s reasons for embracing non-smoking casinos will be helpful in customer retention.
We think this may be a tough sell for some casino customers, although nonsmokers will revel in the news. Do you think Harrah’s can do it?
April 13th, 2007 at 2:13 pm
I think Harrah’s will be very successful with their new non-smoking policy. Most smokers already are faced with many limitations on the places they are allowed to smoke, and this is not going to come as a surprise. The fact that Harrah’s is going to provide smoking lounges, will appease those who want to have a smoke and do not wish to head outdoors. The many people who are non-smokers will probably take up the slack left by those leaving to have a smoke.
April 16th, 2007 at 8:47 pm
I think designating smoking areas is a good idea, but I also hope they put a restriction on where people can wear the perfume and cologne that makes some of us sick.
July 27th, 2007 at 4:24 am
I think Vicky has a point. Lets ban perfume and cologne. It makes me sick.