Macau search trends support Wynn mass grab

Macau search trends support Wynn mass grab

Tuesday, March 14, 2017
Over-indexing on Google suggests market share gains

The consensus view that Wynn Macau failed to achieve any market share gains with the opening of the company’s new property in Cotai is not supported by detailed analysis of Google search trends, according to the team at Morgan Stanley.

The Wynn Palace opened in August 2016 but its debut was overshadowed by issues with the amount of tables allocated to the new property by the Macau gambling authorities. In its last results statement, Wynn Resorts said its Macau operation saw a 10.7 percent fourth quarter decline in casino revenues to $465.3m, although this was largely driven by a 17 percent decease in tables games VIP turnover.

Still, mass market table games turnover was also down 15 percent but the analysts at M Stanley suggest the latest search trends would indicate Wynn has overtaken Galaxy and Melco Crown in terms of queries. They point out that in the months leading up to the opening of the Wynn Palace, Wynn accounted for around 6-8 percent of all search queries which was roughly equivalent to its market share of around 8 percent.

However, in the months since the Palace opening, those figures have shot up to between 12-13 percent indicating potential upside in terms of market share. In comparison, the search percentage for Galaxy was 9 percent and that of Melco Crown was 10 percent. All lagged market leader Las Vegas Sands with 27 percent.

The M Stanley team pointed out that the recent return to growth in Macau has been driven by a resurgent VIP sector where growth in the fourth quarter stood at over 13 percent compared with 7 percent mass growth over the same three months.

The rise in overnight stays is helping the market. “Overnight visitors typically spend 4-5 times more than day trippers,” say the analysts. “The number of monthly overnight guests reached a new high in January 2017, making up 55 percent of total visitation. Overnight visitation increased 10 percent in 2016, the best result since 2011.”

But the team noted that Macau remains in the early stages of its life cycle as a destination for Chinese visitors. “The percentage of China's population that have been to Macau remains surprisingly low compared to Las Vegas,” they point out.

Macau’s annual penetration ratio (calculated as the number of Chinese visitors to Macau divided by China's population) was just 2.6 percent in 2015, significantly below the 13 percent penetration of US visitors to Las Vegas. “Macau continues to lag Las Vegas in terms of total visitation (31 million visitors in 2016 versus Vegas at 43 million), despite a much larger population base to pull from,” they added.

Totally Gaming says: Arguably, Wynn in Macau will be one of the more obvious places to see how the trends towards mass grwoth over VIP plays out in Macau. The evidence from the search trends talked about by Morgan Stanley would suggest Wynn could be well placed.

Latest

Isleta breaks ground on $40m casino expansion

Unikrn looks to Vegas with acquisition of esports firm LEET

SugarHouse Casino hosts free ‘Draft House’ party

Operators turn to VizExplorer for cutting-edge CRM solutions

Unikrn looks to Vegas with acquisition of esports firm LEET

SugarHouse Casino hosts free ‘Draft House’ party

Operators turn to VizExplorer for cutting-edge CRM solutions

Isleta breaks ground on $40m casino expansion

Latest poll

Is the current bonus structure to blame for the gambling industry losing trust?

A recent Gambling Commission survey has noted a plummet in consumer confidence in the gambling industry. What do you think is the biggest cause behind this?

Confusing sign-up bonus conditions
49% (55 votes)
Over saturation of gambling advertising on TV
19% (21 votes)
FOBTs and the campaign against them
16% (18 votes)
Perceived association with crime
10% (11 votes)
The incidence of problem gambling
5% (6 votes)
Clustering of gambling establishments
2% (2 votes)
Total votes: 113

Gaming Products & Services Directory

The essential directory for the gaming industry