Wynn Resorts, LTD was formed by former Mirage Resorts Chairman/CEO Steven Wynn on October 25, 2002, who currently serves as the Chairman of the Board and CEO of Wynn. His knowledge of the gambling and casino industry is indispensable to Wynn Resorts, as he is accredited to turning the luxury casino industry in Las Vegas into what it is today. Wynn’s mission is: “A commitment to providing an elegant environment, high quality amenities, a superior level of service and distinctive attractions for our customers.” The company currently has operations in both Las Vegas and Macau Peninsula in China. Wynn Las Vegas, the company’s first development, was opened on April 28th, 2005. A year later, the company broke ground on an extension to Wynn Las Vegas, to be called Encore Suites, which is expected to be completed by 2009. While the project was initially envisioned as an expansion of Wynn Las Vegas, after it opened December 22nd, 2008, the hotel and casino quickly took on a life of its own and became a full‐scale resort, and is adjoined to Wynn Las Vegas. The property, which encompasses 217 acres of land with 111,000 Sq.ft of casino, 137 table games, but also luxury hotel accommodations of 2,674 hotel rooms and suits, 36 fairway villas, and 6 private entry villas. There is an 18‐hole golf course, 18 restaurants, bars and nightclubs, nighttime entertainment options, an on‐site Ferrari and Maserati dealership, over 76,000 square feet of high-end retail space, and of course all the usual casino amenities, but with a layout that is unique to Wynn Resorts. Today, the company competes closely with Bellagio, Caesar’s Palace, Luxor Hotel & Casino, Mandalay Bay Resort & Casino, The Mirage, Las Vegas Sands, New York Hotel & Casino, Treasure Island, The Venetian, The Palazzo and Genting Highlands Resort.
Porters Five Forces Competitive Analysis
In Las Vegas, the competition is moderate. There are many competing hotels, but the market, after some consolidation, resembles an oligopoly. The competitors also have significant investments in developing brand loyalty, especially among the high-rollers.
The barriers to entry are largely related to the location of the property, brand loyalty, and gaming licenses that are awarded by the government.
The bargaining power of buyers is muted by high degree of differentiation among competing properties, resulting in some brand loyalty and switching costs.
The bargaining power of suppliers (mostly service staff, specialized gaming infrastructure and equipment), and threat from substitutes is low.
In Macau, the intensity of competition is lower because the government strictly controls the award of licenses, which also acts as an entry barrier. Even so, the casinos that are awarded licenses compete actively among themselves to build a successful franchise. The licenses are given for a fixed period and need to be renewed which introduces some uncertainty in the industry. Strengths
Wynn Resorts’ competency flows primarily from Steve Wynn’s instincts and vision. Steve Wynn himself is the major strength of Wynn Resorts as he has more than 30 years experience in Las Vegas. This man has contacts, alliances and knowledge that could not be easily replaced. Wynn resort brand is synonymous with luxury in the casino market. Wynn focuses on high-end customers and differentiated its services towards segmented market. The company knows how to take care of high-end customers, and keep them loyal to the brand. High-end customers feel pampered and relaxed, and they definitely seem to believe that the visit to Wynn Resorts property is worth it. This translates into millions of dollars of revenue at high margins for Wynn Resorts. The tip-pooling system, which enables supervisors and dealers to share in the tips, and enables experienced dealers to become supervisors without any loss of income. Wynn has an experienced management team, who are working to build quality resorts and ensures the...