Inside Asian Gaming

INSIDE ASIAN GAMING | June 2011 14 for the players, and other periods can work well for the house—even though over the long-term this volatility gets ‘smoothed’ for all the operators, thus reflecting the underlying (and very low) house advantage in the baccarat game. But for the financial community— focused on quarterly, half-yearly and year on year business trends— these win-rate variations are an important variable to be factored in. Despite all those very necessary caveats, there does appear room for a larger than normal dose of optimism about the trajectory of the Macau gaming market and Galaxy Macau’s place in it. If the MOP24 billion figure for total May revenue comes to pass by the time readers see this, it will have meant a year on year growth in GGR of 41% when compared to May 2010’s total of MOP17 billion. Galaxy Macau’s operator, Hong Kong-listed Galaxy Entertainment Group, said 20,000 people visited the Cotai resort in the very first hour-and-a-half of its phase one opening on Sunday 15th May. Even taking into account the opening ‘bounce’ in visitors that every new property in Macau has experienced, that looks impressive. The issue is, can Galaxy Macau maintain a consistent and above market average performance in the coming months, even if—as many observers expect—the initial frenzy dies down and daily guest numbers drop somewhat. And one visitor through the door is not the same thing as one gambler at the tables. Sources at Sands China, for example, said The Venetian did more revenues over the first two days after Galaxy Macau opened than it had been averaging on a month-to-date basis. This was despite the fact it appeared to IAG and some other observers that The Venetian’s foot traffic on the main floor was down from its normal levels in the week of the Galaxy Macau opening. IAG ’s observations of Galaxy Macau and anecdotes from other sources—while not scientific— do suggest sustained high use of the gaming tables and also the slots in the first two weeks of the property opening. The slot performance—in terms of people actually queuing to get on machines—is particularly interesting given that in Macau during 2010 the contribution of slots as a percentage of the gaming gross actually fell compared to 2009. Galaxy Macau may have taken a leaf out of Genting Singapore’s book over at Resorts World Sentosa in the Lion City. At RWS, the slots are in sociable clusters and integrated with table areas rather than spread out in endless rows often extending well away from table areas in the manner of Las Vegas Sands’ Marina Bay Sands in Singapore, or The Venetian on Cotai. At RWS, all of the slot zones are on the way to somewhere, naturally creating foot traffic and the potential for casual play. The same principle seems to apply at Galaxy Macau. Peter Johns, Vice President of Electronic Gaming at Galaxy Macau, and his team seem to have succeeded in producing both a portfolio of ‘hot’ games appropriate to the market and one that is visually appealing across the floor in terms of top boxes and other electronic promotional media. The return to player percentage at Galaxy Macau (how much the machines give back to the playing public as a percentage of total money wagered) is—for the time being at least—a well-kept secret and could stay that way given that there is currently no legal minimum RTP for slots in Macau (unlike Singapore). But it seems likely that at Galaxy Macau, a combination of competitive RTP and word of mouth among players is providing at least some of the enthusiastic slot traffic. As one industry executive told IAG : “From his days opening and running slots at MGMMacau, I would expect his RTP at Galaxy Macau to be among the most competitive in the market.” Window shopping Another important factor in the apparent success of Galaxy Macau’s slots and mass market tables could be the property’s unambiguous player rewards scheme. Examples of the gifts players can get for their points are actually on display in glass cases at the Galaxy Privilege Club desk, which takes up a significant portion of the eastern side of the main gaming floor. Most of the mass market membership desks and schemes IAG has seen in rival operators’ venues focus on abstract concepts Galaxy Macau Winning lines—industry experts generally agree Galaxy Macau got its slots offer right Signs of change in Macau mass marketing