Owner says business smarts key to strip club’s success
Today I’m writing about a strip club. Work, work, work. But this is an instructive Vegas story about the business acumen of free limo rides, $20 lap dances and celebrity red carpets.
Crazy Horse III is celebrating its sixth anniversary on Thursday night, and while you’re probably thinking, “How hard is it to make money with a strip club?” plenty of clubs fail in this city. Our stripper cup runneth over.
Crazy Horse III opened in 2009 at the beginning of America’s worst economy since the Great Depression.
While the big boys on the Strip were laying people off and cutting back operating hours, little 24/7 Crazy Horse III invested in a rock star lounge fronted by actual rock stars (it was difficult to convince people it was for real), a hookah lounge (it could have used Starbucks coffee and free Wi-Fi) and strippers (lots of strippers).
Worst of all, everyone but Crazy Horse III said it was a lousy location. Instead of being grouped together with other strip clubs around Highland Drive, Crazy Horse III was stuck way out on Russell Road all by its lonesome, two blocks west of Mandalay Bay hotel.
“Everyone was, like, ‘That’s a terrible location,'” club owner Nando Sostilio recalled, with a smile.
But Sostilio had a plan. Specifically, an 18-month plan of consistency, quality, stars, marketing and freebies.
“Most people, they put an ad in, and 18 days later, they want to know why there’s not a line down the street,” Sostilio said.
But he hired a PR firm he still employs to this day, a decision usually reserved for nightclubs not strip clubs.
Coming from a family in construction, he helped redesign the interior into a female-friendly aesthetic, using extra dollars from that first 18 months to reinvest.
He hired casino-level cleaners.
“We take out every piece of furniture once a week and clean it outside, flip the chairs outside, and scrub everything clean,” he said. “That’s why it smells fresh. People appreciate that.”
You think Uber is a deal? Sostilio’s limos give free rides to locals and tourists, and he gives free admission to anyone who uses the limo service, which amounts to 200 to 300 people every Saturday night.
“I have eight or nine limo drivers that work full time. We have 10 vehicles,” he said.
He has sushi on the menu, brought in from an outside chef.
Locals receive free entry plus a card that can get reloaded with hundreds of dollars in free drinks every year.
And he steers clear of money-grubbing impulses.
“You can’t get greedy,” he said. “You’ve gotta be consistent. You can’t get busy one week and double the prices of the drinks.”
And is there any strip club in America that has rolled out literal red carpets for as many paid (and unpaid) celebrity hosts?
The club has featured Paris Hilton, Michael Phelps, Snoop Dogg, Diplo, Steve Aoki, Afrojack, Adam Carolla, Carmen Electra, Joanna Krupa, Jermaine Dupri, Dennis Rodman, Tyson Beckford, Travis Barker, Shanna Moakler, and porn stars Katie Morgan, Kaylani Lei and Jenna Jameson.
“People like to be where the party’s at,” is how Sostilio explains the magnetism of customers to famous names. “People like to be in the hustle and bustle, and they like to be part of something that’s successful.”
Thursday’s host is porn star Destiny Dixon.
Sostilio has a lot of ideas about how to keep business booming, from the allure of “Everyone has a seat,” to the credo, “If you don’t pressure people into spending more money, they spend more money.” And the reason celebrities pop in at 4 in the morning for an after-party drink and sushi?
“I don’t call (the media) and say, ‘Guess what, Paris was in last night,’ because they’ll see you’re just using their name all the time,” he said. “Sometimes, they want to know they can come in and chill out.
“They’re also not hassled,” he said. “I think if the entire staff walked up and tried to take a picture with them, they would never come back.”
But essentially, he said, he’s always focused first on service and hospitality, then on entertainment.
Business people make a certain mistake all the time, he said, choosing penny-wise-pound-foolish cutbacks, hoping customers will hang in there — but they don’t.
“If you spend the money, and market correctly, and operate everything correctly, people appreciate that,” he said.
As a result, Crazy Horse III beat the odds of a recession and an unusual neighborhood to become a thriving staple of Vegas celebrity culture, sitting on Google Maps near newer Town Square and uppercrust Whole Foods.
“The funny thing is,” Sostilio said in his Boston accent, “people say to me, ‘You have such a great location, because you’re so close to the highway, and you’re right behind Mandalay Bay!'”
Doug Elfman can be reached at delfman@reviewjournal.com. He blogs at reviewjournal.com/elfman. On Twitter: @VegasAnonymous.
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