MGM Bets On 'Experience'
Several MGM Resorts International executives have departed recently, taking buyouts as part of a major cost-cutting initiative. But a new hire may show the future direction of the Las Vegas-based casino giant.
Atif Rafiq is charged with boosting profitability and driving the strategies outlined in the “MGM 2020” restructuring effort. That includes overseeing the companywide customer service transformation, which will have a heavy focus on tech and digital initiatives.
Rafiq, who has held top tech jobs at Volvo, Amazon and McDonald’s, said he welcomes the challenge of driving business through enhanced customer experiences at MGM Resorts, which generated nearly $12 billion in revenue last year.
“Every Fortune 100 or Fortune 300 company has a digital organization or a chief digital officer role now, but very few would take that person with the most digital chops and put them in charge of P&L [profit and loss] and the full core business,” Rafiq said in a recent interview. “I think that’s where things are headed, though … the whole business needs digital experience at the core and I think that’s fairly unique today.”
Rafiq will report directly to MGM CEO Jim Murren and is expected to develop new customer experiences and launch digital initiatives.
“He’s worked at a variety of different companies and had a variety of different careers but all of them seem rooted in terms of strategy in digital investments,” Deanna Ting, senior hospitality editor for Skift.com, told KNPR's State of Nevada.
Ting spoke to Rafiq about his plans for his new position. He told her that digital would be the core part of the business, which means investing in a digital framework.
“That digital networks and systems need to be put into place just to make things a lot more efficient to make it so that it’s easier for those brands to know who their guests are, to know who their consumers are to better personalize the consumer experience for people," she explained.
Ting said improving the digital framework of the company would have a huge impact on the resort's loyalty program known as M-Life and its 26 million members.
Loyalty for a company like MGM Resorts International is "incredibly important" she said.
The other part of the digital upgrade for the company could be partnerships with established digital platforms like Uber, Lyft, Rent the Runway, and Airbnb.
For instance, MGM could offer hotel room booking through Airbnb with an offer for exclusive access to Airbnb Experiences or offer guests access to Rent the Runway clothes for a night out a club at the resort.
Ting said Rafiq doesn't have specifics yet but other travel industry brands have created similar partnerships.
Rafiq told Ting he's excited to be working on the 'intersection of hospitality and the experience economy.'
Ting explained that the 'experience economy' is the idea that people want to spend money on experiences instead of things; however, now many people in the travel industry are talking about the 'post-experience economy,' which she said is the idea that people want experiences but they want them to be authentic and genuine - not manufactured by a company.
“How do they make us as consumers or who are consuming these experiences feel more like we’re a co-creator of them,” Ting said.
She said people are sophisticated consumers of experiences and will know when something is being pushed on them. Part of Rafiq's job will be to get people engaged but in a way they don't feel duped.
“How does he take what MGM has and deliver meaningful experiences for consumers but do it in a way that is profitable for the company but also do it in a way that makes people want to come back to MGM Resorts.”
Deanna Ting, senior hospitality editor, Skift.com