Magazines were filled with glossy ads featuring beautiful people and South Beach-style sophistication at a new, oh-so-hip place in Atlantic City called Revel.
The $2.4 billion Revel megaresort portrayed itself that way in the weeks leading up to its splashy debut last April. Now, a year later, Revel must pay special attention to its image again as it deals with the possible stigma associated with bankruptcy. A bankruptcy filing is expected this week, possibly on Monday.
Public relations and casino experts say it is important for Revel to rebuild its image at the same time it repairs its finances — otherwise, the casino’s hoped-for turnaround could be delayed or never come at all.
“The public wants to know that they’re not going to walk into a business that could close its doors at any second, especially if you’re the gambling public,” said Scott Sobel, president of Media & Communications Strategies Inc. of Washington, D.C.
Sobel, whose firm specializes in crisis management, said Revel must emphasize positive developments to the public and media as it moves ahead with its bankruptcy restructuring. Part of that strategy should include getting the word out using social media such as bloggers and Facebook, he noted.
“The key is to take all of these good initiatives and portray the casino in a good light and to do it consistently and with a steady drumbeat,” Sobel said. “You don’t want a day to go by where there is nothing in the news or in the social media about this casino. You don’t want doubts in anyone’s minds that this is a viable business going forward.”
Revel, Atlantic City’s newest casino, positioned itself early on as a radical departure from its forerunners. Its business model emphasized that Revel is a resort first and a casino second. But Revel now seems to be refining its strategy to target more casino-oriented customers.
Darlene Monzo, Revel’s senior vice president of marketing, stated that the company is “carefully evaluating all aspects of our business, including our marketing and branding strategies,” to find more ways to increase revenue.
“We are in the process of conducting thorough market research to better understand our target market’s opinion of Revel as well as our strengths and weaknesses relative to the brand and the gaming segment,” Monzo said in a statement. “This exercise will enable us to identify areas where we can improve our offering and better cater to the preferences of our target audience.”
Revel’s restructuring plan calls for a prepackaged bankruptcy filing to reduce its debt from $1.5 billion to $272 million, according to a 400-page disclosure statement sent to the casino’s creditors.
The casino, which cost $2.4 billion to build, is now worth between $400 and $500 million, according to New York-based financial firm Moelis & Co. The value is based on projections Revel provided that showed the resort requiring four years before it becomes fully profitable and one year before it will bring in more revenue — $323 million — than the $314 million it would take to operate Revel in 2014, the company said in documents.
Revel also estimates that if the casino were sold within the next six months in a distressed, forced sale rather than what officials have decided — which is to proceed with a prepackaged bankruptcy — net proceeds would amount to between $246 million and $331 million, the company said in the disclosure statement. Companies are legally required to provide that calculation as part of all bankruptcy filings.
Concurrent with the bankruptcy restructuring should be a public relations campaign and a new marketing blitz to reassure customers that Revel will remain open, experts emphasized.
“The casino has to get the message out that they’re going to survive this and come out stronger,” Sobel said.
Gene Grabowski, executive vice president with Levick LLC, an issues management firm based in Washington, D.C., said that Revel should make no attempt to pretend or hide the fact that it is in bankruptcy.
He suggested that Revel should take a two-pronged approach that includes both a whimsical side poking fun at its bankruptcy and a more serious side that explains Chapter 11.
“I think they’re going to have to make light of it,” Grabowski said.
The lighter approach would include special events, promotions and gimmicks for Revel’s customers, showing them that they could still go to the casino “for a good time,” Grabowski said. A more serious tone would be taken in press releases that keep the media updated on Revel’s bankruptcy proceedings, he added.
Grabowski said his firm used the same strategy to help amusement park operator Six Flags through its 2009-2010 bankruptcy.
Wayne Schaffel, a public relations consultant and former Atlantic City casino executive, believes that Revel must lower its prices and tone down its image as an exclusive, resort-style attraction if it hopes to draw more local customers.
“I would just reinvent it. I would make it into a luxurious, locals place,” said Schaffel, president of the Public Relations Network of White Plains, N.Y.
While the local crowd could provide a steady flow of traffic, Revel could also reach out to high-end overnight guests by flying them in on casino charter flights, Schaffel said.
Alyce Parker, a former Atlantic City casino public relations executive, said it will be key for Revel to reach out to its customers to see exactly what they want. Revel, Parker added, should use customer feedback as the platform for a new media campaign.
Sounding like Schaffel, Parker said that a “reinvented Revel” is what is needed. At the same time, Revel must carefully target its advertising efforts to tap markets that will give it the best returns, she said.
“Advertising is extremely expensive,” Parker said. “They have to identify their geographic market. Is it local, regional or past-regional? Then they have to target that market, or bring back their existing customers.”
Although Revel could handle most of its image-building campaign, it should also call on celebrities, politicians, financial experts and professors to act on its behalf in dealing with the media, Sobel suggested.
“There needs to be an advertising campaign, as well as a media plan, to get out all of the good points, all of the entertainment points, the resort points — all of the positives to the target audience, whether they’re coming from Philadelphia, New York or other places,” Sobel said.
Staff Writer Hoa Nguyen contributed to this report.
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