ATLANTIC CITY, N.J. (AP) — The latest casualty of the economic meltdown: casino comps, the freebies handed out to gamblers to keep them happy and coming back for more at Atlantic City's 11 casinos.
Total comps fell by nearly 5 percent last year, to $1.55 billion.
Analysts say the decline in freebies was an unavoidable consequence of the sputtering economy. At the same time, stiff competition from slots parlors in Pennsylvania and New York have been attracting gamblers who once had little choice but to come to Atlantic City.
Casino analyst Joe Weinert expects the trend to last well into 2010 as casinos focus their promotional cash on bigger fish, leaving mom-and-pop gamblers with fewer freebies.
"It's a conscious decision to cut back," he said. "They have to target their cash very carefully and cut out the low-end customers. They're being very careful about how they're throwing those free dollars around."
It just doesn't make sense for a casino to send free buffet coupons or show tickets worth $25 or $30 to gamblers whose past level of play shows their likely loss at the casino would be about $50, Weinert said.
Spending at casinos — including how much is wagered and how much is won and lost — is closely tracked at each casino through loyalty cards, also referred to as player's club cards.
For all of 2008, revenues at the Atlantic City casinos fell 7.6 percent, to $4.55 billion.
The seaside gambling resort — America's second-largest after Las Vegas — is now in its third year of a revenue decline that started in early 2007 with the opening of slots parlors in the Philadelphia suburbs.
That was a market that had been Atlantic City's exclusive territory since casino gambling began here in 1978.
The comp situation continued to be disappointing for gamblers last month: January's promotional spending declined 3.2 percent, to $115.4 million, compared to the same period in 2008.
Comp spending was down at seven of the 11 Atlantic City casinos last month.
Nicholas Ribis, co-owner of Resorts Atlantic City, New Jersey's first casino and one that's trying to stave off foreclosure by its lender this month, says comps were part of what the casino had to cut back on in order to save money.
In testimony last month before the state Casino Control Commission, he said Resorts had been giving away "too much food, too much drink, too much everything."
This January, Resorts gave away $6.3 million in comps; last January, it handed out $7.8 million.
Other declines: Bally's Atlantic City went from $15 million in comps last January to $11.3 million this year; Caesars Atlantic City went from $12.4 million to $11.1 million this year; and the Showboat Casino Hotel went from $9 million to $8 million.
Trump Marina, which is in the process of being sold and wants to trim its expenses to make it as attractive as possible to new owners, went from $6.5 million last January to $5.6 million this year, and Trump Plaza Hotel Casino went from $7 million last January to $6.1 million this year.
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