71
based Harbinger Advisers. “On its own, that’s a multimillion dollar company.” Mr Arasi cautions against integrat-
ing resorts too deeply. “Some people don’t want to be part of some environ- ments,” he says. “The gaming elements are ring-fenced in Singapore.” In con- trast, the Venetian Macao follows Las Vegas custom, so it is almost impossible to avoid walking through the casino to get around the resort. Non-gaming attractions also broad-
en the appeal of a casino resort. “The high roller might not go to Universal Studios but his wife and kids might,” Resorts World Sentosa central zone op- erations director Jason Horkin says, not- ing that the theme park hosts VIP visits daily. “If I’m a high roller, I want to be left alone to gamble. If you have more offerings for my family, maybe I play longer. Maybe I come more frequently.”
Bottom line, not headlines The attention won by components in resorts is not necessarily indicative of their importance to pro tability. It is not theme parks and big ticket shows but
CREATING A GLOBAL
DESTINATION A
fter arriving from Las Vegas, Melco Crown Entertainment Ltd. vice-pres-
ident for customer relationship manage- ment, loyalty and pro t optimisation Steven Pinchuk thought of the legendary Land of Oz when he saw the non-gaming numbers in Macau. “We’re not in Kansas anymore,” Mr Pinchuk realised. City of Dreams, home to the US$250
million (MOP2 billion) House of Danc- ing Water show, three hotels, nightspot Club Cubic, and an array of events and meetings and incentives, clocks in with 8 percent non-gaming revenue. Mr Pinchuk believes he knows why.
“An integrated resort needs to be in a major international destination market to succeed,” he says. Tourist numbers due later this month
will likely show Macau set a record with more than 27 million visitors last year but tourists are still overwhelmingly from Greater China, with the concentration growing as mainland arrivals surge. The city remains a regional rather than an international destination. A major global travel destination
offers a diverse visitor base to patronise the range of attractions casino resorts offer, plus the infrastructure to support large scale conferences and exhibitions, a key to boosting non-gaming revenues, according to experts. Singapore’s resorts record non-
“Voyage de la Vie” resident show - Resorts World Sentosa
gaming revenues of 22 percent, compared with 11 percent for all Macau operators, according to the latest nan- cial reports. Singapore’s higher number is the product of government policies to promote non-gaming revenue multi- plied by its longstanding status as an
international travel hub, even though it registered about 13 million visitor arriv- als last year, less than half of Macau’s total. “The resorts are part of a larger
tourism eco-system supported by a vibrant and pro-business environment and reliable infrastructure,” Singapore Tourism Board executive director for resorts Carrie Kwik tells Macau Busi- ness. “Other upcoming projects such as the international cruise terminal, Gardens by the Bay, the world’s rst river safari, and the National Art Gallery, will complement the integrated resorts by further expanding our repertoire of offerings, deepening our value propo- sition and attracting new and repeat visitors to Singapore,” she says. Despite those advantages, plus a
local market that is ten times the size of Macau, Singapore’s percentage of non-gaming revenue is still far from the 60 percent-plus of Las Vegas. Melco Crown co-chief operating
of cer for operations Nicholas Naples acknowledges a “resort is much more likely to succeed in a destination that is already known as a major international travel destination”. His job is to make City of Dreams – and in the future a second casino resort at Macau Studio City – succeed in Cotai. “In the case of Cotai, we will require
other infrastructure before it can com- pete with other established interna- tional destination resorts,” Mr Naples says. “Rome was not built in a day, even Las Vegas and Atlantic City had to go through this process to get to where they are today.”
JANUARY 2012
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