For the last 16 months, all of us in experiential entertainment have been looking for ways to re-evaluate, re-imagine, and reinvent ourselves – how we interact with our employees, with our guests, and with the world. The location-based and experiential entertainment industry has been catapulted forward, with technology driving innovation at accelerated speeds.
Is it time to invest?
Now that the global economy and travel is starting to open up (Delta variant aside), what should owners be looking at so they can plan for the future of your business? As an executive consultant, brand advisor, and experiential designer, owners and manufacturers are asking us what our perspective is, as we are often seen as a canary in the coal mine.
If owners, consultants, and designers are busy planning for tomorrow’s why and the next big thing, several years of activity ensue. If not, then the active cycle of many employers, service providers, and manufacturers faces a reduced growth cycle.
With that in mind, for owners we recommend you analyze the following 3 key points as you recover from this challenging period and start to look forward once again.
Attendance volume is up, pricing power is strong, people are willing to travel
If you’re seeing attendance climb, you’re not alone. There’s a lot of pent-up demand and FOMO as a result of the pandemic. Attendance is one of the, if not the, most important indicators of demand. How does attendance compare to a normalized year? To the long-term strategic plan? The more demand, the more price you can command.
When consumers are willing to open their wallets, it’s a strong indicator of consumer confidence
Next, inflation is driving pricing across the board in all economies in all categories. For most of the pandemic, consumers stayed close to home and did not visit places like resorts, hotels, airports, tourist destinations, theme parks, museums, FECs, and malls. Many of those locations were inoperable for some or all of the pandemic.
Also, if your admissions per caps are rising, it’s time to cut back the pricing promotions. Look at your ancillary revenue as well. For instance, food & beverage, merchandise, premium experiences. An increase in consumer spending further solidifies consumer confidence.
When consumers are willing to open their wallets, it’s a strong indicator of consumer confidence. While US consumer confidence took a slight dip in May, overall it is growing. In fact, across the world, consumer confidence is up significantly.
Finally, generally, the further guests are willing to travel, the stronger the demand indicator. And we see that airline travel is growing. While volume is still significantly lower vs 2019 comparisons, it’s climbing month over month, as U.S. airlines carried 9.5% more scheduled service passengers in April 2021 than in March 2021.
China is seeing strong domestic tourism growth, as are international locations such as Greece, Croatia, Turkey, and the UAE. With rising demand and pricing power, now is the time to re-evaluate those 5-year strategic plans and revisit the cyclical need to continue to build demand – by investing in a new experience.
Your brand and the guest feedback loop are a powerful combination
In today’s competitive social, economic, and entertainment environment, brand is the key differentiator moving people to make decisions: what we pay attention to, how we spend our discretionary income, where we choose to build lasting memories with our families and friends.
The most successful brands in the world form relationships with consumers through great storytelling. They create opportunities for consumers and guests to interact with the brand through a guest feedback loop.
The importance of WHY has increased exponentially: Why should I take a potential risk with my family to have this experience? What will it add to my family’s life and memories that are compelling and worthwhile? Why is this risk worth investing in? Why is there a compelling emotional connection to this choice?
Guest satisfaction measurement is more important than ever. These first guests returning are your most dedicated and loyal. They will happily and willingly provide you insights if you give them the platform to do so. There are multiple ways to achieve this. Some examples of low hanging fruit are exit surveys, email surveys, social media engagement, and focus groups, to name a few.
If you’re not currently employing these tactics, it’s time to do so. The guest feedback loop is critical in helping you make the decisions that will shape the future of your business. The combination of your unique brand’s value proposition and your guests’ feedback is a powerful tool.
Time to invest? Your competitors are already doing it
While none of us is in the business of keeping up with our neighbours, we’ve seen numerous examples of global investment picking up again.
Domestically, there has been much to celebrate:
- Universal Orlando Resort launched Jurassic World VelociCoaster, which has just celebrated its 1 millionth rider, in time to welcome back Orlando summer crowds.
- Herschend Family Entertainment made a major announcement regarding a half-billion-dollar, 10-year investment campaign starting with a new resort—Dollywood‘s HeartSong Lodge and Resort—set to open in 2023.
- Meow Wolf is opening a new destination in Denver
- The Illuminarium is opening a second location in Las Vegas
- Guerrier Development announced Storyville Gardens, Nashville’s first theme park since Opryland.
Globally, we’ve seen numerous announcements in recent months:
- Mandoria, City of Adventures opened in Poland, representing Europe’s largest indoor theme park.
- At Energylandia, in Poland, the land of Aqualantis has opened
- Gardaland Resort in Italy, Europe’s first, home to waterslides, rafts, swimming pools, and Duplo and Lego attractions.
- In China, several major projects have been announced
- In Japan, three integrated resorts are continuing to move forward
- Another proposed Paramount Park has been lauded in Bali
In the arts, theatre, and cultural sector countless expansions and new projects have also been announced. This includes news from the Museum of Other Realities, Puy Du Fou, Cirque Du Soleil, National Air and Space Museum, Giant Screen Cinema Association, Shanghai Planetarium, and M+ Museum in Hong Kong.
The list goes on.
Trends to watch
So, if it is time to invest, what trends should owners be looking at when making investment dollar decisions? We’re going to cover more of this in part 2. For now here are the things we are keeping our eye on:
- Transformative experiences
- Game Engine driven experiences
- Immersive experience that have resonant emotional impact that will extend in a call to action and resulting behaviors
- New technologies to deliver storytelling and brand narratives in forms of engagement never before available- for example haptics, eye tracking, AI, machine learning, zero latency motion capture with real time reactions.
- New Team architectures and WFH technologies
- Know your consumer, what they want, and how they hold influence
The key takeaway?
In the end, those who don’t invest will get left behind. Consumers are growing more selective in how to spend their discretionary dollars, so it’s more important than ever to be the brand of choice. Watch your business trends closely and consider that perhaps now is the time to take a calculated risk and invest for the future.
Be proactive. Don’t get left behind. In an accelerating competitive and fractured entertainment space, where technology and the consumer’s expectations are leapfrogging annually, there will not be the luxury available to play catch up.
In Part 2, we’ll also explore long-range planning and adapting in a changing market by adding value to the end-user. Media distribution is changing and learning how to rapidly iterate and build a cooperative community across industries will be critical.