LVCVA President and CEO Steve Hill is likely to get a $15,292-a-year raise at Tuesday’s meeting of the agency’s board. Two companies are also expected to land advertising and public relations contracts worth more than $600 million to promote tourism.
The big news is that if the Las Vegas Convention and Visitors Authority board approves the contracts as recommended by the board’s marketing committee and several chief marketing officers from the LVCVA’s resort partners, it will mark the first time marketing and advertising responsibilities will be split between two agencies. The process was funneled through a Los Angeles-based consultant, Select Resources International, which conducted the final review May 17.
Las Vegas R&R Partners, the agency’s PR company of record for decades, is likely to land a four-year, $500 million contract (with two option years) to continue its advertising and public relations work.
The contract with Grey Global Advertising of New York represents a combined $160 million for the same four- to six-year time frame to promote Las Vegas as a destination via social media.
It’s going to be interesting to see how well R&R and Grey play together when developing ideas to market Las Vegas. Many insiders believed R&R’s longtime affiliation with LVCVA would give it an edge over the three other finalists who made presentations before the board’s seven-member Marketing Committee and a variety of resort partner chief marketing officers.
But it seems like the right move, because as travel picks up and more people are looking for places to vacation, the agency faces more competition for travelers to come to spend their money in Las Vegas. Tribal resorts are closer for out-of-staters in Arizona and California, but they simply don’t have the infrastructure Las Vegas has with its 150,000 rooms and multiple attractions
R&R will be responsible for account management and brand planning; advertising and content creation; research; public relations; crisis communications; and events and sponsorships. The annual pay breakdown will include $6.72 million for agency services; $7.56 million for content creation services; and $4.2 million for media services. The rest goes to media and advertising buys. The entire contract is subject to a 3.5 percent consumer price index increase.
The contract with Grey Global Advertising of New York is much smaller — with LVCVA budgeting $20 million for fiscal year 2022, $26 million for ’23, $27 million for ’24, $28 million for ’25, and $29 million for the first option year and $30 million for the second. The annual pay breakdown will include $2.46 million for agency services; $4.5 million for content creation services; and $1.44 million for media services.
Just like the R&R contract, a 3.5 percent consumer price index bump is included.
R&R has the advantage of knowing the Las Vegas marketing environment better than most out-of-state agencies and has been at the LVCVA’s side through a number of hard times. R&R’s proximity to the market has given it an edge, quickly jockeying campaign debuts after the Oct. 1 shooting and Kobe Bryant’s untimely death in a helicopter crash.
The LVCVA went out of its way to level the playing field for the four finalists to try to ensure no single group or individual had an overwhelming influence on the final decision.
Whatever some might say about R&R having an inside edge, Las Vegas is likely to be well-served by this collaboration between R&R and Grey.
As for Hill’s salary increase, the LVCVA compensation committee was conservative in its approach and compared salary increases occurring within other government entities in Southern Nevada at a time when revenue has been sliced by the coronavirus pandemic.
A 4 percent pay increase to someone who didn’t get one last year seems fair, and the rest of the LVCVA executives and staff are getting between 2 percent and 4 percent.
Hill received no bonus — a policy that was prevalent pre-2018. It used to outrage some people to see the previous CEO get a $50,000 bonus on top of double-digit percentage pay increases.
Of course, all of this could change by the time the full LVCVA board considers it Tuesday.
We’ll see if the recommendations stick.
Contact Richard N. Velotta at email@example.com or 702-477-3893. Follow @RickVelotta on Twitter.