What is going on at Melco Crown Entertainment? News reaches Asian Gaming Intelligence, via a report in the Sydney Morning Herald, that the name ‘Crown’ is to be dropped from the Crown Macau resort and used instead for City of Dreams, the joint venture’s integrated resort on Cotai due to open next year.
This may appear to make sense at first consideration. City of Dreams should in theory provide a higher volume of visitors and cash turnover than the VIP-focused Crown Macau, and will be the engine that drives the company’s hoped-for success in the territory.
Branding is a strange thing though. It means more than just a company logo on the side of a can or on a building. It’s about a relationship between the consumer and the service provider and it depends on trust.
Melco and its Australian joint venture partner Crown Ltd would certainly not win any marketing industry prizes for the way they’ve handled corporate identity issues since they joined forces in Macau in 2005.
In fact if the connection between the JV and its customers was seen in terms of a personal relationship, there would be the risk of divorce on the grounds of Melco Crown’s unreasonable behaviour.
The JV started life as Melco-PBL (the latter standing for ‘Publishing and Broadcasting Ltd’, the original name of Mr Packer’s media and gaming conglomerate. This then morphed into Melco PBL Entertainment (MPEL) for stock trading and publicity purposes when the company listed on Nasdaq in December 2006.
Then in December 2007 the company underwent yet another change of name when Mr Packer’s PBL demerged, and the gaming business, Crown Casinos, became Crown Limited. From hence (for the time being) the company has been known as Melco Crown Entertainment. Just for good measure, and to add to the confusion, the initials MPEL were retained for the company’s stock market listing and as an official abbreviation of the outfit’s name.
In Melco-PBL, MPEL, Melco Crown Entertainment’s defence, the PBL demerger was an external factor beyond its direct control. The degree of chopping and changing in the identity of the Macau gaming operation must inevitably though set the minds of consumers and investors to wondering exactly what the joint venture stands for. If Melco Crown can’t even agree on its name for public consumption, what’s going on behind closed doors?
Early on in the Melco-PBL, MPEL, Melco Crown Entertainment adventure in Macau, the public and gaming industry were told that Crown’s strong brand would be the key to establishing the partners as a force in gaming in China. If Crown Macau does drop the ‘Crown’ part of the name, what message does that send out to people both in Crown’s home market in Australia and overseas in a key and growing market such as China? The company lost a key member of its management team earlier this month when Garry Saunders, Melco Crown’s Chief Operating Officer, resigned, though the company stressed this was for personal reasons.
Nonetheless, if the Sydney Morning Herald report is correct, then stripping a strong brand identity from one property and giving it to another is arguably the worst of all possible worlds. It causes confusion in the minds of the punters and the industry, but crucially it also risks damaging the credibility of MPEL and of the Crown brand itself. If the Taipa venue was good enough to carry the Crown name before, why isn’t it good enough to bear the name now? Successful companies don’t treat their identity like a coat to be slipped on and off as the mood suits. Companies without a clear sense of direction and mission sometimes do.
