Inside Asian Gaming

INSIDE ASIAN GAMING | February 2010 8 Cover Story If high rollers aren’t coming to Macau during Chinese New Year in the usual numbers (or at least not spending so much), then who is coming? Anecdotal evidence from observation and from speaking to marketing executives at the casinos is that it’s mass-market visitors. What the available statistics show is that in raw numbers terms (and without indicating socio-economic status), it’s mainly people fromGreater China (the Mainland, Hong Kong and Taiwan). In 2007, for example, when the lunar holiday was in February, the percentage of visitors coming from the People’s Republic to Macau rose 24.9% compared to the previous month. The pattern was similar with Hong Kong and Taiwan, with increases of 19.6% and 41.6%, respectively. (The Taiwan figures were probably skewed by air passengers en route to family reunions on the Mainland being forced to transit via Macau. At that time, China was still banning direct flights between Taiwan and the Mainland). Given that mass-market tourists have families just like VIPs, there’s a strong possibility that many of the 2007 CNY visitors to Macau were day-trippers making a quick foray to the casino jurisdiction before returning at night to the bosom of their families. DSEC figures for the whole year indicated 52% of all tourist arrivals were day visitors staying on average 0.2 days (i.e., approximately five hours). If Macau has a higher than average cohort of day visitors during Chinese New Year than at other times, it’s reasonable to assume that casinomarketing strategiesmay have to be tweaked accordingly during the holiday period. This is to not only to account for seasonal factors such as goodwill and good luck, but also to grab visitors’attention and dollars at a time when there are plenty of other distractions to empty their wallets such as banquets, family games of mahjong and distribution of lucky red packets of money to business associates and family friends (known as lai see in Cantonese or hóng bāo in Mandarin). Seasonality It’s risky to make too many assumptions about Macau’s holiday visitors based on raw statistical data. The casinos themselves have more detailed information, but are generally reluctant to make it publicly available. One- off or seasonal visitors pose a particular challenge even for the casinos’ professional marketing teams, given that casual visitors are less likely to sign up for customer loyalty schemes than regular visitors. As one Macau gaming executive told IAG : “Before you can market products and services effectively to customers you need to know who those customers are. Chinese New Year is different from other times of the year from my experience because you have a lot of visitors who aren’t necessarily gamblers. As a casino operator however you can’t just sit by andwave themoff on a trip to St Paul’s [the ruins of a 17th century Catholic cathedral built by Jesuits] or to Hac Sa Beach. You need to engage them, hold on to them long enough to find out who they are and generate some revenue from them. Once you’ve done that you have a better chance of converting them into repeat customers.” In January, City of Dreams, Melco Crown Source: Macau Statistics and Census Service (DSEC) City of Dreams gaming floor Year of the Pig 4000 5000 6000 7000 8000 9000 10000 11000 12000 13000 14000 2007 Apr. 2007 Jan. 2008 Jan. 2009 Jan. 2007 Jul. 2007 Oct. Year of the Rat 2008 Apr. 2008 Jul. Gross gaming revenue (million patacas) 2008 Oct. Year of the Ox 2009 Apr. 2009 Jul. 2009 Oct.