February 8, 2018 - 1:02 pm
Updated February 8, 2018 - 5:56 pm
The speedy descent of Steve Wynn on sexual harassment charges may have no long-term impact on the eponymous brand, say marketing, crisis management and hospitality experts.
Wynn stepped down Tuesday night as chief executive officer and chairman following several reports he repeatedly harassed female employees. The accusations raised concerns the company may need to change its name to distance itself from his actions.
A household name in Las Vegas, Steve Wynn doesn’t command that great popularity beyond the desert region and thus may not be closely tied to his Wynn brand, some experts said.
“I think the impact on Wynn Resorts will be short-lived, in part because I doubt most people link these resorts with Steve Wynn or are even aware of him,” said Itamar Simonson, a marketing professor at Stanford University.
Deb Gabor, a 30-year brand consultant and chief executive officer of Sol Marketing agreed, saying the Wynn name can stay if studies show Steve Wynn isn’t well-known outside Las Vegas.
“The company will have to double down on the values the name implies — luxury and once in a lifetime experiences — and distance themselves from Wynn the person,” she said.
A name change ‘is not being contemplated at the moment,” said Michael Weaver, a spokesman for Wynn Resorts. “It hasn’t been discussed.”
Costs of rebranding
The impact on the brand could take weeks to discern, said Eric Rose, a crisis manager at Englander Knabe & Allen. Even if there is a slight impact on the business, it has to be weighed against the costs of rebranding, which could run into the tens of millions of dollars, he said.
“What they have to do is let the dust settle for a few weeks and conduct some research among customers and the public,” said Rose. “My gut feeling is that they will probably not have to change the brand.”
President Donald Trump has also been accused of harassment and offended many people, but the brand hasn’t suffered as much as people thought, Rose pointed out.
Trump Tower Las Vegas posted double-digit growth last year, said Phil Ruffin, Trump’s partner in the project, during an interview last month with the Review-Journal.
Trump was among a small group of individuals who advised Wynn in the early 2000s to name the new casino operator after himself.
Wynn Resorts owns two casinos each in Las Vegas and Macau, the Chinese gaming enclave. It is building a new casino in Boston, which is scheduled to open next year, and the company is building a new resort on the Strip.
High-end visitors to Las Vegas and Macau don’t have many options to splurge and gamble in luxury outside Wynn properties. The gaming industry is highly regulated and licenses are difficult to obtain.
“The brand is powerful and associated with the ultimate in luxury and opulence in Vegas,” said Anthony Curtis, who runs Las Vegas Advisor, a newsletter with 12,000-15,000 subscribers. “As things currently stand, there is no effect at all. Wynn-Encore is the top dog in that category with or without him.”
“I think if they changed to anything but Wynn, it would produce negative effects. Powerhouse brand with high-end casino-goers,” said Curtis.
Capacity constraints will also likely mean that the economic impact on Wynn will be slight. Macau visitations are expected to rise by 10 million, or about 50 percent, over the next five years, according to Morgan Stanley. Strip room occupation is currently hovering at 90 percent while Strip convention space is near full utilization, the bank said.
The National Investors Relations Institute said it considered relocating its annual June convention from the Wynn Las Vegas but that five months was not enough time to find another location to host its 1,000-plus attendees.
Wynn’s relatively quick departure — just 11 days after the harassment story first surfaced in the Wall Street Journal — may help stem the negative news flow and spare the brand name.
“He acted rather quickly to save the brand,” said Rose. “As long as he is truly out of the day-to-day operations, there won’t be an immediate backlash.”
How Wynn chose Wynn Las Vegas
When Steve Wynn began building his new multibillion dollar resort on Desert Inn Road in the early 2000s, he initially intended to name it Le Rêve.
Wynn hired advertising specialist Peter Arnell to see what Las Vegas visitors through of the name, which means
“The Dream” in French.
“You can call it ‘Le Rêve,’ but you’d damn well better say it’s the guy who built The Mirage and Bellagio. And for my money, that’s too much information,” Wynn recalled Arnell telling him according to Wynn Magazine.
Wynn then turned to media executive Barry Diller, then-casino owner Donald Trump and movie director Steven Spielberg.
“Everybody in New York is talking about your new hotel. They know you’re calling it ‘Le Rêve’ because you’ve got the painting (“Le Rêve” by Pablo Picasso), but they know it’s you. So you might as well call it Wynn,” he recalled Trump saying.
Wynn Las Vegas was a hit and when the developer decided to build a second tower, then-wife Elaine Wynn recommended he call it Encore to signify a repeat performance.