David Green compares and contrasts the profile of visitors to Las Vegas with those to Macau
On April 30, the Las Vegas Convention and Visitors Authority released its 2006 Visitor Profile Study. The result of detailed and statistically robust surveys, conducted monthly, the Study indicates that the gulf between Las Vegas and its alter ego of the East is not as pronounced as geography and economic circumstance might imply. While not all the metrics used in the Study are measured, or reported, by the Macau Census and Statistics Service, DSEC, those that are make for interesting comparison with Las Vegas.
In 2006, Macau welcomed some 22 million visitors, compared with almost 39 million in Las Vegas. Both markets were heavily reliant upon their “local” catchments. DSEC does not report mainland visitors to Macau by province of origin, but, anecdotally, industry observers suggest that as many as 90% originate from neighbouring Guangdong province. Hong Kong remains a key contributor, providing almost 33% of visitors to Macau last year. Taking Guangdong and Hong Kong together, they likely provided more than 80% of all visitors in 2006.
Of Las Vegas’s 39 million visitors, some 87% originated from within the United States, and 32% from one State…California. The Western States together accounted for 52% of arrivals, suggesting that while Vegas remains the mecca of the gaming world, its pilgrims are by and large coming from areas in close proximity. Only 13% of Vegas visitors originated outside the US. Repeat visitors accounted for more than 80% of the total. DSEC does not provide details of repeat visitations to Macau, though it can be inferred that a high proportion of visitors originating from Hong Kong are repeat, and probably serial, visitors. Almost 7 million visited from Hong Kong during the year – not bad for a Special Administrative Region of less than 8 million people.
Prosperous neighbourhoods
The similarities between the two markets on this account are striking. Both draw heavily on populations nearest to them. California and Guangdong (including Hong Kong) are two of the most economically developed regions in their respective countries. The repeat visitor to both markets is more likely to come back to gamble than the first time visitor is to come initially; the Study reported that some 13% of repeat visitors to Vegas return for the primary purpose of gambling, compared with only 1% of first time visitors. In 2003, the Study reported that only 4% of repeat visitors went to Las Vegas to gamble; the increase to 13% in 2006 is startling.
This suggests that the quality of the gambling experience enjoyed by visitors is a key driver behind their return. It also suggests that other attractions, especially entertainment and dining, do not detract from the gambling focus of repeat visitors; indeed they appear to stimulate it.
More Satisfied with Vegas
In regard to the quality of the visitors’ experience, 96% of those surveyed for the Study said they were “very satisfied” with their trip to Vegas. Is the same true of Macau? Perhaps not. Visitors surveyed by DSEC in 2006 recorded only moderate satisfaction with a number of aspects of their Macau experience, especially in relation to public transport, restaurants, shops and gaming establishments, all of which had satisfaction ratings of 65% or less. The latter 3 of these are being addressed now by the new integrated resorts which are, or will, open. Public transport is however a real issue. A point of significant divergence between the two markets is that in Las Vegas, 48% of survey respondents used their own vehicles to get around. It could be safely assumed that in Macau, the comparable figure would be less than 1%, meaning that visitors are heavily reliant on public transport, and that provided by the casino properties.
Spending Behaviour
Visitor spending behaviour comparisons throw up some unexpected results. Average overnight length of stay in Las Vegas was 3.6 nights, compared with only 1.1 in Macau. This suggests that Macau is not yet a “destination”, a not unsurprising conclusion in view of the preponderance of short haul travellers. Of more interest is the fact that Las Vegas visitors stayed an average of 4.6 days, fully one day more than the average length of overnight stay. This is not the case in Macau, where most visitors are same day, and their movements regulated by accessibility to transport, border gates, and the strictures of tour arrangements. The time compression evident in Macau has an interesting spin-off; per capita shopping spending by mainland residents far exceeds the average shopping spend in Las Vegas. The average daily visitor spend on shopping in Vegas is just over US$30, compared with a whopping US$208 for mainland visitors to Macau. Little wonder that high-end retail is an integral part of the new resort developments. Presumably this spend will moderate as average length of stay increases, whether overnight, or by day.
Accommodation and Dining
Accommodation spending in Vegas averaged US$107 per night, compared with only US$47 in Macau. Expect the Macau figure to have moved up significantly in 2007, with more high-end resort hotel accommodation on stream. In the food and beverage department, visitors to Vegas spent around US$57, while those to the Vegas of the East spent about US$36. This is a relatively small difference, but it is again evidence of the effect of time compression, and dining choice. While Vegas is home to many fine and expensive restaurants, they are likely big occasion nights out, which may only occur once a trip, and be punctuated by much cheaper dining options, especially fast food and buffets. The Macau visitor doesn’t have time on his side; if he wants to splash, he has to do it quickly!
Making valid comparisons between jurisdictions on the basis of statistical data alone is impossible. However, the Study gives highly detailed insights to what makes up the visitor population for Las Vegas. It would be interesting to have the data to compare more of these metrics, to see just how alike East and West really are.
A former Australian gaming regulator, David Green heads the gaming practice of PricewaterhouseCoopers in Macau, having originally come to the city in 2001 to conduct the feasibility study on the liberalization of the local gaming industry. He also consults for both the Macau and Singapore governments on gaming regulation.
