Inside Asian Gaming

INSIDE ASIAN GAMING | August 2013 16 INSIGHTS M acau booked US$38 in gaming revenue in 2012, and with the consensus among analysts for 15% revenue growth this year, it appears the world’s largest casinomarket is going to get a lot larger. VIP baccarat will account for about two-thirds of this, and for this reason it’s going to grab most of the headlines as this extraordinary story unfolds. But by no means is it the sole engine driving the plot. Arguably, it’s no longer the primary one either. Play at the cash tables is growing at around triple the rate of VIP. Through the first half of 2013, these games generated MOP55.6 billion ($6.95 billion) in revenue, an astounding performance made more astounding by the fact that the “mass market” as it’s called (to distinguish it from the credit-based play that’s conducted in the VIP rooms with non- negotiable chips) has been delivering year- on-year revenue growth of 30% or better for 10 straight quarters. Combined with a 7% increase in slot revenue in the first half, the effect as of 30th Junewas topushVIPbelow70%of themarket for the fourth consecutive quarter. Since the fourth quarter of 2009, which was the last time VIP came in at less than 70%, revenue from mass tables and slots has grown at a combined 27% or more every year. They’re trending this year at rates that should find them at close to 35% of the market, and that hasn’t happened since 2006. Luxury on Demand In Macau, ‘elite’ used to mean ‘VIP’ ... Not anymore ... With cash players gambling at levels that once were seen only in the junket rooms, casinos are responding with amenities and services that are ‘VIP’ in every sense of the term. The new Pavilion Club is Galaxy Macau’s answer. And it is something special. Deputy COO Gabe Hunterton explains the strategy behind it and how premium mass is transforming the market “Five years ago, there was no such thing as somebody who bet 20,000 or 30,000 or 40,000 [Hong Kong] dollars on the mass gaming floor. All of that betting was done in VIP rooms. Now there are players who bet 200,000 and 300,000 and 400,000 a hand in mass gaming. And those players not only expect but they deserve a superior experience. And that’s what Pavilion Club High Limits gives them. It has all the amenities of the VIP room, because the people gambling in there are gambling at exactly the same level.”