All Eyes On Macau

    One of the big developments we've seen in Macau recently is the Tourism Department's more intense efforts at diversifying the city's cultural offerings.
    Jing DailyAuthor
      Published   in Travel

    New Construction, Casinos, Business Inflows, Museum Openings, Point Toward A Surge In Macau's Fortunes#

    Macau, a former Portuguese colony often overshadowed by its larger and more international neighbor, Hong Kong, has become a hotbed of activity over the past 10 years. With the city's status as a Special Administrative Region (SAR), Macau has benefited from easier flow of capital and more relaxed business regulations -- as well as its status as the only city in China in which gambling is allowed. Although the city was hit hard by the global economic crisis last year, with construction of several projects, including Sands China's ambitious Cotai Strip expansion-- grinding to a halt, Macau has come back to life in the second half of this year, with cultural projects kicking back into gear, construction starting up again, and recent IPOs injecting fresh capital into the system.


    One of the big developments we've seen in Macau recently is the Tourism Department's more intense efforts at diversifying the city's cultural offerings. Macau officials are well aware that gambling is a reliable source of income, but only really for the casinos. Since most visitors to Macau come from Mainland China, and few of them spend more than a day or two in Macau -- mostly inside casinos -- it is imperative for hotels and businesses in the cultural realm to entice more visitors to stay longer, spend more outside the casino, and take in some of the tourist sites and resources the city has to offer.


    While Macau's Tourism Department has had some success in boosting MICE (Meeting, Incentive, Conference and Event) revenue in recent years, the real objective is to make Macau more of a Las Vegas-style family destination, where (usually) the father can gamble while his family enjoys other activities. Until recently, Macau has suffered from a dearth of non-gaming activities, but a Wall Street Journal article from earlier this month points out that the city's efforts at providing more entertainment fare so far seen limited success:

    Casino operators here in the world's most vibrant gambling market are trying to learn how to win at a new game: family entertainment.

    It's a gamble. At recent shows by the Canadian circus troupe Cirque du Soleil in the Venetian Macao, a smattering of attendees filled only a small fraction of the available seats, according to visitors. A spokesman for the Venetian Macao says attendance at the show's 1,800-seat theater has averaged 65% of capacity this year, including discounted tickets—a figure that the resort's management calls "unacceptable."


    One of the challenges that sets Macau apart from Las Vegas is the fundamentially different profile of the average Macau visitor. While Las Vegas appeals to everyone from families to hordes of bachelor party revelers and serious gamblers, Macau -- despite its plush hotels, strong culinary traditions, unique colonial architecture and cultural activities -- is seen by most visitors as a day-trip destination for gambling and, for some, luxury shopping sprees. Few families make the trip across the border to take in shows, and this -- to some observers -- reflects the core difference between Mainland Chinese tourists and Western tourists when going to a gaming destination. From the WSJ article:

    Hong Kong-based Galaxy Entertainment Group Ltd., which is preparing to open its massive casino-resort adjacent to the Venetian Macao, isn't planning any attempt at a Cirque-like show—at least for the time being.

    "This is not what people come to Macau for," says Francis Lui, vice chairman of Galaxy. Instead, Mr. Lui is planning more modest offerings, such as an "old Shanghai"-themed nightclub, and a Southeast Asian-styled white sand beach and wave pool that sits atop the casino—entertainment options that he says cater better to Asian interests.

    Mr. Lui concedes that it may be too early to tell if Macau's market can embrace Las Vegas-style shows, noting that Macau still lacks critical mass. But he says that selling a Cirque-like show to a Chinese audience that has grown up with Beijing acrobatics wasn't going to be easy.

    "You can't simply import these shows that appeal to Western audiences and expect them to impress an Asian audience," Mr. Lui says.

    Though not everyone agrees that it is impossible to make Macau an entertainment hub -- entertainment is, after all, one of the key priorities for Singapore's SkyPark integrated resort (IR), and Singaporeans are no less an Asian audience than Chinese. Though the cultures have differences, they're not wholly dissimilar, and actually probably share more in common than not. This similarity should seep over into the tourist realm.


    One of the more interesting entertainment offshoots we've seen in Macau recently is the growth of exhibitions, and signs that museums and galleries will attract visitors to venture beyond the walls of the casino to soak up some of the cultural offerings. Last month, an exhibition of contemporary works of traditional Chinese art was held at one of Macau's dedicated art museums as part of the Macau Tourism Department's diversification initiative. In addition to the city government's efforts to broaden cultural activities, we're also seeing movement from casino and hotel owners themselves. This week, Macanese casino executive Hoffman Ma purchased several items owned by Michael Jackson, including the iconic rhinestone-encrusted glove, at a much-publicized auction in New York with the expressed intention to create a museum dedicated to Jackson at his casino, Ponte 16.

    Like Las Vegas before it, casino-based museums and exhibitions could become a major draw in Macau in coming years, helping these casinos diversify their offerings without incurring the relatively high cost of bringing in performers or touring acts.


    It will undoubtedly take some time for Macau to fully mature as a tourist destination. Although all of the elements are there, they have yet to gel into a more "integrated" whole, to borrow the phrase from Singapore. The key will likely be the growth of China's outbound-traveling middle class. Since most Mainland travelers to Macau currently hail from the country's southern regions -- barely a hop over the border -- they have less incentive to stay overnight than their Beijing- or Shanghai-based peers. If Macau can more effectively entice Chinese travelers from faraway provinces, they'll have a captive audience of urban tourists who are, on the whole, younger, likely have more sophisticated tastes that make them more likely to seek entertainment venues as much as gambling, urban, and adventurous.

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