Inside Asian Gaming

inside asian gaming August 2016 12 Cover Story the government would like to see. It gets visitors to stay longer. Someone will gamble.” The other benefit, according to AECOM Vice President for Economics Chris Yoshii, is that, “A resort with theme park elements is seen as an entertainment destination rather than just a gaming destination. “Land near a major casino is very valuable, so the smaller the footprint the better,” he adds. “Smaller and indoor parks are likely to have a shorter length of stay, but more intense experience, which saves time for the dining and gaming.” Third party attractions also democratize entertainment. Planet J Vice Chairman Francis Chan notesmany family entertainment features, such as Marina Bay Sands’ rooftop infinity pool and Galaxy Macau’s Grand Resort Deck, are exclusively for guests of the host property. “Planet J is open to the public. Anyone who can get a ticket is allowed to play in our park.” Entertainment returns run below those of other IR segments and experts disagree on whether they can delight investors. “As a company we do not do loss-leading attractions,” Mr Luderitz declares, citing Mohegan Sun’s experience with its Connecticut IR. “Our vision in Korea is to develop a number of unique profit centers by combining gaming, entertainment, culture and the arts, conference and hospitality under one roof.” “Ideally, we would like all our non-gaming entertainment attractions to be self-sustainable,” Melco Crown agrees. “However, currently, the majority of our profit is still attributed to our gaming business, which supports our investment and development in the non-gaming business.” For example, Lawrence Ho claims the Batman ride cost too much for a standard theme park to build. “In the bigger picture though, these non-gaming attractions also play the ‘brand differentiator’ role, helping to draw new visitors to the properties and differentiating us from our competitors,” Melco Crown explains. “They also create brand stickiness and even brand loyalty in the long-term, which would ultimately become profitable and self-sustainable. Hence, we believe it is important that we maintain high standards of our non-gaming products and services, not only to generate revenue but also to grow a loyal customer base.” The Innovation Group Vice President, Operations Planning and Analysis, Michael Zhu offers a similar stance. “We do not expect the family entertainment attractions to be a profitable standalone division, especially during the initial years of operation, in that most of these facilities are likely to be utilized as marketing tools to drive gaming volume and overall visitation to the property,” he says. “In the long term, however, these attractions can be profitable by themselves once the brand’s public awareness is established.” Profitable or not, family entertainment offers a vital avenue for Macau to raise its game. “Lack of natural attractions, such as beaches or mountain views, means Macau needs to come up with something unique and exclusive to compensate,” Mr Zhu says. Time will tell whether theme rides and treasure hunts will lift Macau to new heights or run off the rails. This Disney-loving family was spotted by Global Market Advisors’ Andrew Klebanow at the Venetian Macau earlier this year