Inside Asian Gaming

5 Editor and Publisher Kareem Jalal Director João Costeira Varela Business Development Manager Ricardo Carvalho Operations Manager Rita Horta Contributors Octo Chang, Ben Lee, Glen McCartney Photography Ike Graphic Designers Ricardo Borges Karen Yiu,Vincenzo Zaccaria Editorial Inside Asian Gaming is published by Must Read Publications Ltd Rua de S. Domingos, nr 16-i, Ed.“Hin Lei”7A - Macau Tel: (853) 6646 0795 For subscription enquiries, please email subs@asgam.com or call José Abecasis Tel: (853) 2838 9055 For advertising enquiries, please email ads@asgam.com or call Ricardo Carvalho Tel: (853) 6682 8475 www.asgam.com Complacency has given way to “cutthroat” competition in Macau’s casino sector, according to erstwhile monopoly operator Stanley Ho. In response to the competition, Dr Ho’s Sociedade de Jogos de Macau (SJM) is getting increasingly image conscious. During Dr Ho’s 40-year monopoly, relationships, rather than image, drove customers to his properties, with the bulk of casino revenue deriving from high-stakes baccarat played in private VIP rooms.The main floor of Dr Ho’s flagship Casino Lisboa was left to decay, and customer service was only a vague concept among the often surly dealers known for tipping themselves from the winning chips of gamblers at their tables. Competition has eaten into SJM’s market share at a faster rate than analysts had originally predicted, proving Macau casinos can no lon- ger neglect image, even in the VIP market. Following the opening of the crowd-pulling Sands Macau, SJM undertook a series of refurbish- ments at the Lisboa, but the company’s most important branding initiatives lie ahead. In an interview with Inside Asian Gaming , Dr Ho’s right-hand man Ambrose So conceded“Lisboa was built in the sixties, the ceilings are low and it’s very cramped, and now people are looking for a more comfortable environment.” SJM will provide that at the Grand Lisboa, which will open on February 11, in the run up to the Chinese New Year visitor influx to Macau. SJM promises to give HK$10,000 (US$1,300) to a random visitor at the Grand Lisboa every 15 minutes to mark the property’s opening. Stanley Ho may possess more marketing savvy than observers awed by Vegas-style glitz credit him with having. Last year, Stanley Ho earned ridicule for his attempts to lure more visitors to his prop- erty with offers of complimentary dishes of barbecued pork rice. Gamblers losing all their money at Wynn Macau’s casino and being presented with their bill at its Red 8 noodle shop may form a differ- ent opinion. SJM’s new president of joint ventures and business development, Frank McFadden – the former COO of Las Vegas Sands Corp’s local subsidiary, charged with running Sands Macau – informed Inside Asian Gaming that unlike the foreign newcomers developing Vegas- style facilities in Macau, SJM will maintain gaming as its core attrac- tion. The octogenarian Dr Ho remains a shrewd operator, but his son, Lawrence Ho, has proven more adept at building a brand – after all, Asia’s youth is a lot more brand conscious than the older generations. In 2003, the younger Mr Ho established Mocha Slot, which now runs Image Conscious six conveniently-located café-style slot machine outlets throughout Macau. Mocha Slot was the first gaming operation in the city to establish a distinct brand identity, and this issue’s “The Serious Slot Player” on page 6 discusses how the company plans to retain its niche in Macau despite the impending arrival of mega resorts offering thousands of slot machines. Mocha Slot General Manager Ted Chan believes Mocha’s sole focus on slots will allow it to continue demanding the loyalty of gaming machine aficionados, despite the glitz and glamour offered by the mega resorts, which will attempt to serve the needs of all types of visitors. Macau casino operators are still finding their way in the wake of the ever-growing deluge of mainland Chinese visitors, with brand build- ing in the city very much in its nascency.The marketing efforts of the casinos are still focused on Hong Kong customers, and tend to treat mainland Chinese as a homogenous entity. As pointed out in “Chi- nese Are Not All the Same” on page 14, the mentality of “it works for me, then it must work for all the other Chinese,”neglects the myriad cultural differences among the various regions of China. “Brand Change” on page 18 outlines how Macau casinos are fol- lowing the lead of their Las Vegas counterparts in their marketing endeavours.The arrival of casino branding in Macau is regarded as another sign of the maturing of the industry since it was liberalised in 2002. Some of the branding efforts are, shall we say,“quaint,” such as the Grand Emperor’s mock Beefeaters – pictured on page 18 – performing the changing of the guard while grumbling in Russian. Others are market revolutionizing and go on to be imitated around the region and even world, such as the stadium-style gaming floor at Sands Macau, which remains, in our view, the most exciting place for mass market customers to place their bets in the city. Virgin Group founder Richard Branson was in Macau last month to explore the possibility of getting involved in what has become the world’s pre-eminent destination for tourism and gaming investment. Mr Branson’s interest in Macau is apt considering the city still offers virgin ground for international resort developers. Rather than emu- late, however, these developers could opt to innovate and tailor their marketing efforts to meet the specific needs of the mainland Chinese market.The real sign that Macau has matured will come when Vegas starts looking east for inspiration. Kareem Jalal We crave your feedback. Please send your comments to kareem@asgam.com