BETHESDA (dpa-AFX) - Marriott (MAR) and MGM Resorts (MGM) have announced a strategic partnership aimed at leveraging their loyal customer base to boost revenues on the Las Vegas Strip. The exclusive long-term licensing agreement, called the MGM Collection with Marriott Bonvoy, will be launched in October and will include 17 of MGM's resorts, including well-known properties like Luxor and Mandalay Bay.
Under the agreement, customers will have the option to book MGM stays through Marriott's platform, while still having the choice to book directly through MGM's platform. The partnership allows members of each company's loyalty program to link their accounts and redeem points for stays at any of the 17 participating MGM locations. MGM currently has 40 million loyalty members, while Marriott boasts a significant 180 million under its Bonvoy brand.
Loyalty points are highly valued by frequent travelers and often play a crucial role in choosing accommodation. Companies in the travel industry, such as Marriott and MGM, utilize rewards systems to attract new business by offering various incentives and exclusive perks to their loyal customers.
In addition to the licensing agreement, Marriott has also entered into a loyalty marketing agreement with BetMGM, MGM's online gaming and sports joint venture. This collaboration allows Marriott rewards members to earn points on specific BetMGM transactions and participate in exclusive games and experiences.
Marriott CEO Anthony Capuano expressed enthusiasm about the partnership, stating, 'We look forward to increasing our global rooms distribution by 2.4 percent as we grow our presence on the Las Vegas Strip and in other compelling destinations across the US.'
The collaboration comes at a time when the Las Vegas Strip is recovering from the detrimental effects of the COVID-19 pandemic. The latest data from the Las Vegas Convention and Visitors Authority shows a 1.5 percent year-over-year increase in visitors to the Strip in May, with strong demand for activities in the area. The revival of the convention business played a significant role in driving the increase, with convention attendance improving by 16 percent compared to the previous year.
Key metrics for hotels on the Las Vegas Strip also showed positive signs of recovery. Revenue per available room, a crucial indicator, rose by 6 percent year over year to $169. Although occupancy levels improved by 1.5 percent compared to the previous year, they still remained approximately 5.2 percent below the pre-COVID levels of 2019.
Industry analysts are optimistic about the future of the Las Vegas Strip, citing the return of conventions and a robust sports and event calendar as factors that will support the recovery. With upcoming events such as NCAA men's Division I basketball tournament games, Formula 1 races, LV Raiders and Golden Knights games, the 2024 Super Bowl, and more, analysts anticipate growth in gaming and non-gaming revenues.
Macquarie analyst Chad Beynon has Buy ratings on shares of MGM Resorts, Caesars Entertainment, Golden Entertainment, Accel Entertainment, Vici Properties, and Century Casinos. He believes that the Strip's future growth prospects are promising, driven by a combination of conventions and exciting events in the coming years.
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