The Year of the Metal Tiger (2010) was a golden year for Macau’s casino gaming industry, registering yet another year of spectacular growth. Annual gross casino gaming revenue in 2010 grew to US.5 billion. This is a 58 percent increase year-on-year, and eclipses the GGR levels in all of Las Vegas.
In 2003, this figure was just US$3.6 billion. Back then, there were 11 casinos and all under one company. Now, there are 33 casinos and six major operators in the marketplace.
Equally impressive is the growth of the so-called non-gaming sectors. For example, Macau’s retail sales have risen rapidly over the years. For the first three quarters of 2010, retail sales were already valued at approximately US$2.7 billion, or a 35 percent increase year-on-year. Back in 2006, retail sales were just US$1.3 billion.
Note that Venetian Macao officially opened in August 2007, along with 1.6 million square feet of retail space and more than 300 retail shops. Melco Crown’s City of Dreams, Venetian’s closest rival by proximity, opened in June 2009 with another 175,000 square feet of retail space. I believe we are just beginning to see the dawn of a strong retail and leisure industry in Macau, and Cotai appears to be leading the way.
Demand appears to be picking up, and visitors are starting to see Macau not just as a destination for hard-core gamblers, but also sightseeing, entertainment and shopping. It will be the place to be for all businesses in the retail and leisure industry—a “must-go” for all tourists and gamblers to Macau.
As the “Monte Carlo of the Orient,” “Asia’s Las Vegas,” “Gambling City” and “Sin City,” Macau has always had a reputation as a place for gambling activities only. However, over the past few years, Macau has evolved slowly and steadily into an entertainment city for the masses. The government’s effort to diversify Macau’s economy is starting to show. Macau is not just getting more gamblers into its 33 casinos. Surveys each year reveal that around half of Macau’s visitors gambled in its casinos.
That leaves the other half for other purposes, with shopping being one of them. Another encouraging sign for Macau is that there are increasingly more visitors arriving in package tours from non-traditional segments (not mainland China). Visitors from Korea who came particularly by package tours, for example, have increased by leaps and bounds. There are also increasingly more visitors from India, Japan and other parts of Asia.
On the first three days of Chinese New Year (which is the Year of the Wood Rabbit), I visited all six major properties and their casinos—namely, Grand Lisboa, Venetian, Wynn, StarWorld, MGM Grand and City of Dreams. These casinos were jam-packed with eager gamblers, most of them Chinese.
Outside, shoppers and their families “ransacked” their favorite retail shops in places like Venetian Macao, City of Dreams, Wynn Macau and One Central Macau (right beside MGM Macau). Shoppers picked items from expensive Louis Vuitton bags to down-to-earth Giordano jeans.
There are evidently more families with young kids and grandparents visiting Macau compared to a few years back. In fact, visitors’ per-capita shopping expenditure in Macau has registered increases over the past few years. Surveys in the first three quarters of 2010 revealed that visitors to Macau were spending on a variety of shopping goods including watches, jewelry, clothing, cosmetics, shoes and handbags, as well as popular local food products.
Having recently returned to Macau and witnessed these phenomena, I am pleased to see the increasing acceptance of Cotai as a choice destination for many visitors to Macau. When Galaxy Macau opens its doors this year, three of the six concessionaires will now operate on the soil of Cotai. This should create a stronger Cotai brand and effect, reinforcing Cotai as a major international tourist destination.
An enlarged supply of unique world-class experiences in Cotai can help generate greater interest among existing and potential visitors, and thus, encourage new and repeat visits to Macau. As “Asia’s Most Exciting Destination,” Venetian Macao has crafted a strong reputation as the first to set foot on the Cotai Strip. And it did it with a bang. Then came the City of Dreams, which recently opened the “world’s newest most spectacular extravaganza,” the House of the Dancing Waters. City of Dreams is truly “A World of Firsts.” Galaxy Macau, which will open next, is looking to extend Cotai offerings through its motto: “World Class, Asian Heart.”
According to government surveys, visitors to Macau are also spending a large portion of their non-shopping and non-gaming money on food and beverage. There will be more than 50 restaurants and food outlets in Galaxy Macau when it opens its doors. This is one of its major non-gaming contributions to the variety of experiences in Cotai. Galaxy Macau appears to have done its research well.
In 2012, visitors to Cotai can choose to catch a show at the City of Dreams, shop at the Venetian or enjoy a sumptuous meal in Galaxy Macau. They can also choose to stay in any one of the luxurious hotels offered by these properties and play in their modern casinos—a world-class experience at the heart of Cotai.