It likely won't be the only, or the last, hospitality company to do the same.
Las Vegas-based gaming and hospitality giant MGM Resorts International is looking to Silicon Valley to transform its business with its latest executive hire.
The company on Wednesday announced it has appointed Atif Rafiq into a new role as president of commercial and growth, reporting directly to CEO Jim Murren. His tenure begins in May.
Rafiq, who most recently served as chief digital officer and global chief innovation officer of Volvo Cars, will be tasked with developing new customer experiences, business models, and revenue streams for the $14.4 billion company, as well as launching new digital businesses and overseeing sales and loyalty.
He will also be responsible for the company’s revenue streams, as well as ensuring the company maintains its MGM 2020 strategic plans. Those plans rely heavily on, as a company statement noted, “data-driven, digital and customer-centric innovations” to realize $100 million of annualized adjusted earnings before interest, taxes, depreciation, and amortization by 2021. His role is a newly created one, and MGM’s current executive team remains in place.
Rafiq’s appointment is not characteristic for gaming or hospitality, which generally recruit from within their respective industries. But given his extensive background and experience as a chief digital officer, and MGM’s commitment to evolving into a company that places more emphasis than ever on driving revenues from experiences — and not just gaming — the appointment may prove to be an advantageous one for both parties.
“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 told Skift. “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.”
“It’s interesting that this is someone who doesn’t have experience in the industry,” said Dan Wasiolek, a senior equity analyst with Morningstar who covers gaming and hospitality companies. He added, “Digital and loyalty is something that all companies are increasingly focused on, from digital customization of room features and check in to sports betting and more.”
In a statement announcing Rafiq’s appointment, Murren said: “MGM Resorts is on a clear path toward growing the customer experience and digital transformation, and Atif is the right leader at the right time. We conducted an exhaustive search knowing we needed to find someone with not only digital transformation experience, but also a business leader with proven ability to translate emerging consumer behavior into strategy and revenue growth. Atif brings all of these skills to the table.”
Prior to his work at Volvo, Rafiq worked at companies that include Amazon, Yahoo!, AOL, and McDonald’s, where he was chief digital officer and corporate senior vice president from 2013 to 2017. And as for what Rafiq intends to do once he begins his new role, he said he will look to his previous experiences to help him shape the future of customer experience at MGM.
“When I come in, I always come in with a beginner’s mind and I ask, ‘What will Amazon do?'” he said. “If Amazon has one of the most frequented tourist destinations in the world and this captive audience coming to this concentrated geographic space, what would they do with it?”
He continued, “Being a Silicon Valley native in tech companies, I want to think about how to bring the digital and physical together. … I’m looking at it how a tech company would look at it. The opportunities for growth are all there. I’m working to bring that to life with great talent.”
His vision for MGM also has a lot do with his perspective on what the company’s role is in today’s experience economy, and MGM’s competitors — and potential partners — aren’t limited to just gaming or hospitality or travel.
“More broadly, I think this company is more similar to Airbnb than your typical hotel developer, quite frankly,” he said. “It starts with the customer who comes here for some type of escape — to be entertained, to be reinvigorated, or delighted in some other way. It starts with the customer and if you work backwards and build around that, then the question is what can you do beyond what we provide today? That opportunity is very significant.”
In other words, like Airbnb and other travel and hospitality giants, MGM wants to be a true experience platform, and already, Rafiq sees multiple areas for synergies. They include using customer data from MGM’s growing sports business to inform its gaming and hotel businesses, or partnering with brands like Rent the Runway to offer special occasion clothing to guests who stay at one of MGM’s properties.
“I believe this company should be talking to brands like Peloton, WeWork, Airbnb, Rent the Runway, Lyft, DoorDash, all those companies,” he said. “Why not? These define the new generation of consumer behaviors. There’s an intersection between what MGM is good at it what those companies’ purposes are. If we find good intersections there that meet consumer needs, I want to be the first out there to explore it. We need to make our offerings fit naturally into that world — whether we do it ourselves or team up with companies from that cloth.”
Morningstar’s Wasiolek is also keen on seeing what Rafiq does with MGM’s loyalty program, which has 26 million members compared to Caesars Entertainment’s 55 million. “The loyalty program is especially important when you have a Las Vegas presence but also a regional presence, like MGM does,” he said.
As for Rafiq, he is “excited” about the opportunity to work for a company that’s a the “intersection of the hospitality and experience economy.”
“A lot of companies talk about the importance of tech as a way of thinking that’s more nimble and consumer oriented,” he said, but he was most intrigued by MGM’s investment in making digital central to its core business.
“This is more about this becoming the future of the company — the way of thinking and organizing the company, the way of growing,” he said. “That is, I think, a bold and courageous move by MGM’s existing team. It’d be more conventional for me to run a part of Amazon or Google. I’ve done that before. But this will be much more interesting.”
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Photo Credit: Atif Rafiq has been appointed as MGM Resorts' new president of commercial and growth MGM Resorts International/Atif Rafiq
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