New Premier Clubs: Drive Down Costs or Increase Inflation

[headstrong]

In a normal market, new saturation would decrease costs of all execisting entities by creating more supply.

However, Vegas is anything, but normal?

Do you think with the opening of these new "hot-spots" it will:
1) drive costs down at existing clubs due to more consumer options
2) Other clubs (especially in the upper tiers) will be able to maintain or even raise prices to ride the "interest" of these new places

I was hoping for 1, but after seeing the prices, I really don't see it driving costs down to much - more so seeing the now top-end, top-mid places riding the wave.

I was just curious what ya'll thought?

[fordan]

The scarcity isn't the clubs, it's the big name DJs being locked up with exclusive residencies. If you have the current Tier 1s willing to take a step down and book lesser known DJs, you might see prices stay the same. If they keep up the bidding war for DJs, well, that money has to come from someplace.

[JuiceJH]

If they keep up the bidding war for DJs, well, that money has to come from someplace.

I thought the middle eastern billionaire was paying for this ...

[headstrong]

I somewhat agree with that. However, the reason clubs want big name DJ's is to bring in bigger crowds, higher rollers. At some point (in Vegas it's a higher point) people will sacrifice. Vegas, specifically the strip is a city of excess so that line might be very far out there.

To me personally, I am not someone who is big on headliners (DJ-wise). The only reason I semi-care is typically the better DJs have better crowds. However, I personally am willing to sacrifice the better DJ for a better spot or even a better price - to an extent. That's probably out of the norm on this site.

I think two new clubs - if they can remain hot - will drive minimums down on the 1.5/2 tiers after 6 months to a year of success. I'm hoping this is the case.

[ccc]

There is already pressure on the Tier 2 clubs that share Industry nights with the new clubs. However given the mins we've seen from Hakkasan, I don't think XS or Marquee will be dropping their mins in the short term. Service still counts. A great DJ can't counter crappy service, so we'll see how the new clubs shake out before the brunt of summer hits.

[ocam]

There is already pressure on the Tier 2 clubs that share Industry nights with the new clubs. However given the mins we've seen from Hakkasan, I don't think XS or Marquee will be dropping their mins in the short term. Service still counts. A great DJ can't counter crappy service, so we'll see how the new clubs shake out before the brunt of summer hits.

Good post - totally agree with all this.

[kazflair]

The mins will come down at tier 1 clubs on the weekends when they don't have the big DJ's, hence an overall lowering effect. So, when Light/ Hakk, have big Fri Sat Djs and Marquee/Xs dont= the mins at these two will be much lower than what you are used to. the Tier two's are the safest in my opinion. My friends that like EDM, only go to Xs Marquee, etc. when they come to town. My friends that like hip hop hate XS Marquee. Both groups spend money, but now the EDM crew has 2 more options. Hip hop crew, same ones..

[ccc]

Kaz, that's true, but looking at the Ling Ling room rotation from Skam the Tier 2's are going to feel the pinch a little too. It won't all really shake out until late September into November when summer winds down.

The delays with Hak have also created a situation where you have two huge clubs launching at the same time. It's going to be weird.

[kazflair]

I just did a recon tour at Light today... It's Marquee's main room on crack, steroids, and growth hormone. Prob 3-4x size and even balcony doesn't have a bad spot or far out of action. I'll put up a new thread. I think that Marquee is the one club that will be hurt by Light once people check it out and realize every table is in prime viewing of the Cirque stuff and DJ. Still have to check out Hakk next week.

[vegas_22]

Having said that, they can only charge so much before people stop coming.

Too expensive = no crowd = no big DJ

Having a big DJ is not going to be enough to lure people through the doors if the prices remain high.

Just my 2c.

[boags]

Eventually, the big edm 'live' dj phase will go the way of the roman empire. Party up, I give it three years.

[Chuck]

Make way for the super exclusive small venue...