Inside Asian Gaming

INSIDE ASIAN GAMING | September 2011 68 but not directly managed or owned by SJM) the Casino Oceanus VIP room is working on a profit share basis with its agents and host property rather than on a commission basis. “We share most of our profit with the agents,” he explains. “It’s a platform for everyone to make money. It’s the usual Macau structure for VIP marketingwithmaster agent, sub-agent, and multiple levels of agents at grass roots level in China. But by offering a good platform in terms of profit share with the agents, we believe a lot of agents will come to us and we’re going to grow very quickly. It’s not about cutthroat business. It’s about growing together, which is a common approach to business generally in China and throughout Asia. There’s a lot of room for expansion. “I think the [government] table cap has actually been good for us,” adds Mr Tong. “The casino operators are now more careful about picking the most capable VIP investors and operators with the best network of agents to do the work. Right now—for this place [Oceanus] they didn’t just pick anybody; they picked someone they feel very confident with.” SJM has set relatively modest rolling chip turnover targets for the Oceanus VIP room compared to turnover targets in other rooms in other venues. This is on the basis SJM has little to lose and much to gain by having VIP gaming at the formerly mass- market-only property. “For every VIP table [in Oceanus] we need to meet a target set by the casino of HK$100 million total rolling chip turnover per month,” explains Tony Tong. “We are very confident about this location and it’s a good spot. SJM is using this VIP room at Oceanus to counter the Sands [Macao] VIP offer. VIPs arriving at the ferry terminal or heliport and going to Sands Macao need to be picked up by car. Our VIPs only need to take a two- or three- minute walk. The head of Sands’ [Macao] VIP has been to look at us. Jimei at Grand Lapa [next door to Sands Macao] is a different market from us, with agents in different parts of China. There’s not too much overlap between Jimei and us. “We’re essentially marketing to new players—including new players from Hong Kong as well as China. People tend to focus on China but we shouldn‘t forget that new wealth is still being created within Hong Kong—often by Hong Kong residents with business interests in China.” Feature “For every VIP table [in Oceanus] we need to meet a target set by the casino of HK$100 million total rolling chip turnover per month.”