ATLANTIC CITY - The critical task of marketing Atlantic City shifted this week to a new organization created by state laws aimed at salvaging the struggling resort.
The Atlantic City Alliance, a nonprofit entity funded and operated by local casinos and their executives, will assume most of the city's marketing duties and media services previously handled by the Atlantic City Convention & Visitors Authority, which will focus on growing convention business. The changes are driven by the state law that created the city's Tourism District, which launched Tuesday with a vote by the Casino Reinvestment Development Authority.
The Alliance has already started a national search for a chief executive officer it hopes to hire by the end of the summer. The successful candidate will head what one casino executive described as an unusual endeavor: a unified effort by at least four local gaming companies that formerly focused solely on developing their own brands to outperform one another.
"There's nothing that can unite people like a common enemy. And the struggling market is a common enemy to all of us," said Tom Ballance, senior vice president of development for Borgata Hotel Casino & Spa.
The Alliance currently includes Trump Entertainment CEO Bob Griffin, Tropicana Casino and Resort Chief Executive Officer Mark Giannantonio and Don Marrandino, eastern division president of Caesars Entertainment, which owns Bally's Atlantic City, Caesars Atlantic City, Harrah's Resort and Showboat Casino Hotel. Ballance stands in for Borgata CEO Bob Boughner.
State law requires casino licensees with more than $1 billion invested in Atlantic City to participate in the Alliance and contribute to its annual operating costs, which will be partially covered starting next year by gaming taxes that previously subsidized the state's horseracing industry.
Licensees that have put less than $1 billion into their properties do not have to join the Alliance, but must pay a surcharge to help fund it. Officials have not decided how they will calculate that fee, said Ballance and CRDA interim Executive Director Susan Ney Thompson.
"Once we have an idea of the scope of the plan and the budget of the plan, that will allow us to work out what the fee assessment will be," Thompson said.
The Alliance has not determined the geographic areas or demographic groups for its future marketing campaign, but its scope will undoubtedly grow. The Alliance's budget will eventually be at least $30 million and devoted entirely to marketing the resort. The ACCVA's $31 million budget in 2010 was splintered to cover everything from marketing to acquiring convention business.
ACCVA spokesman Michael Bruckler said he does not expect the Alliance to affect its budget, which means the ACCVA should have more money to run convention sales and media services. The 2011 ACCVA budget is about $35 million and helps attract more than 30 million people every year to Atlantic City and its 11 casinos.
Even combined, the Alliance and ACCVA budgets are dwarfed by the nearly $175 million budget of the Las Vegas Convention and Visitors Authority, which assists the city's 33 casinos and draws 37 million visitors annually.
David Schwartz, an Atlantic City native who now runs the Center for Gaming Research at the University of Nevada-Las Vegas, agreed with the need for more widespread, thorough marketing campaigns in his hometown. He specifically recalled the unveiling of the resort's "Always Turned On" slogan.
"They rolled it out on (Jay) Leno and (David) Letterman and didn't do any advertising," Schwartz said. "It sort of epitomizes the whole approach, which is half-measures. And that's going back 30 years. Whereas in Las Vegas, they hire an ad agency, develop a message and are aggressive in getting it out there and they are reasonably successful."
Gov. Chris Christie has publicly criticized the ACCVA for spending what he considers too much on salaries and not enough on marketing. His disapproving assessment coincided with legislative changes.
The Alliance is the corporate arm of the public-private partnership prescribed in S-11, the measure that created the Tourism District. The CRDA, which runs the district, created the zone at its meeting Tuesday by setting boundaries and regulatory structure.
The CRDA will contain four divisions, including the ACCVA and the Alliance. Another division will focus on land use and will include the formerly independent Atlantic City Special Improvement District. The fourth department was created by the CRDA recently in response to residents' call for their input to be heard, in addition to the Citizens' Advisory Commission that state law requires.
Although each division has a primary focus, all will participate in every function of the agency. The CRDA will get input from city government, too, Thompson said.
The Alliance is unique in that it will be a nonprofit. As such, it is not subject to the same public notification and disclosure requirements that the CRDA and its divisions must abide by because they are government agencies. It also is a 501(c)4, the type of nonprofit that does not have to publicly disclose its donors.
The Alliance was formally founded four months ago and is still establishing its relationship with the CRDA. In the meantime, Alliance members are gathering research to determine the best way to structure new marketing initiatives.
"We are deeply engaged in the research that will inform us so we make good decisions relative to what demographic we pursue," Ballance said. "We know we need to bring Atlantic City together as a brand."
Contact Emily Previti: