LAS VEGAS— As of Jan 1, Harrahs Entertainment will have a new CEO and COO, but executives say it will be business as usual at the hotel/casino company, which operates 26 casino properties. Philip Satre, chairman/CEO of Harrahs has said next year he will serve solely as chairman of the company. The move means that in the new year, Harrah’s president, Gary Loveman, will move up from president into the CEO slot, and that Tim Wilmott, currently Eastern division vp, will take the reins as COO. In an interview with HOTEL BUSINESS®, Wilmott said Harrah’s management changes will not affect the companys strategy going forward. In fact, the company, will continue to eye expansion here in the United States as new states consider legalizing gambling of some sort within their borders as they seek new revenue streams in this down economy, he said. Right now, New York, Rhode Island, Massachusetts, Kentucky, Pennsylvania and Ohio have some form of gaming legislation afloat. Harrahs currently does business in 20 local markets around the country. Out of its 26 gaming properties, 20 are casino hotels— facilities on whose guestrooms the company intends to put keen focus. For the past three years, Harrah’s has been spending $200,000, including FF&E, for each guestroom in its casino hotels, Wilmott said. Each room is built with the thought it will be used on a complimentary basis for Harrahs best customers in the casino, he said. “Having first-class hotel facilities in conjunction with our casino operations is an integral part of our strategy,” said Wilmott. “If you look at our companys history, in the last couple of years, the majority of our capital that is being reinvested back into our businesses has been invested in the hotel area.” So far, that strategy has paid off with Wall Street, he said, adding that offering casino players these “Premiere” rooms has enabled Harrahs to expand membership in its “Total Rewards” frequent player program. Indeed, a recent Reuters report said Harrahs has “wowed Wall Street over the last year, showing strength in the face of the broader economic return.” Analysts attribute Harrahs strength to its geographic diversity and its customer loyalty program, “one of the industrys first to tap into its repeat customer base,” the report stated. “We build our hotel rooms with the idea of putting in quality casino customers into those rooms,” Wilmott said, adding that the facilities were built with input from customers and focus groups. Premiere rooms now go into every Harrahs guestroom being built, and have been for the past three years. The rooms are sized at 504 square feet apiece, including baths that approximately measure 100 square feet. Bath amenities are upgraded, said Wilmott, and come with a “four-fixture” offering, which means they have a separate tub and walk-in shower, an enlarged vanity and a private commode. The guestroom itself has nine-foot ceilings and 37-inch screen TVs, he added. The age-old concept of offering casino hotel guests sparse facilities in order to keep them down on the casino floor is fairly archaic, said Wilmott. “Generally, what we have seen in industry over last five years is smart operators have made the capital investment to significantly enhance the quality of their room products. We know through loyalty program that we get a customer who comes to Atlantic City and spends four hours with us on a day trip. When we get those customers to stay overnight with us, we double their gambling budget,” said Wilmott. “That is how we can justify this investment [of $200,000], given the lift we get in the consumer spend when they have an overnight stay. And the importance of gaming revenue that comes from our lodgers in all of our business continues to increase.” Meanwhile, Harrahs has been hard at work adding to its Atlantic City properties. In progress is an expansion at Showboat Atlantic City, which will add 550 rooms in a $90 million construction project. The work, whic
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