Developing the Mainland Chinese Market for Slot Machines: Challenges, Opportunities and Solutions

4th International Conference on Gaming Industry and Public Welfare, Shanghai & Macau, 2007

20 Pages Posted: 24 Feb 2008 Last revised: 6 Mar 2008

See all articles by Kwek Ping Yong

Kwek Ping Yong

University of Pennsylvania - The Wharton School

Kelvin Fu

Inventis

Eugene Chongji Chen

Inventis

Abstract

Macau is the largest gaming market in the world. Its gaming revenues in 2006 have surpassed that of Las Vegas. However, Macau remains a unique gaming market. Table games currently dominate the gaming market in Macau. The revenue split between tables and slots is 98:2 in Macau compared with that of 50:50 in Las Vegas. Clearly, the slot gaming market in Macau has not been fully developed and there is a tremendous amount of growth opportunities available.

Recently, gaming operators, in response to growing demand for slot machines, are paying more attention to their tables and slot machines mix and cautiously increasing the number of slot machines available. Nevertheless, many challenges still exist in trying to increase the gaming revenue generated from slot machines.

Creating and developing this demand for slot machines in mainland Chinese gamers will increase gaming revenues. It is also an important revenue and market diversification strategy. Gaming operators have, hitherto, underserved and underestimated a potentially large and lucrative market segment - casual gamers. Developing this market should be seen as an integral part of the business strategies of gaming operators as the competition heats up.

The aim of this paper is to understand the reasons for the slow take up of slot machines among mainland Chinese gamers and to suggest ways to improve the situation. Specifically, we will look at the current slot situation in Macau, its trends, and the psychological, social and cultural reasons for the low take up of slots machines. We will also look at the current slot machines strategies employed by gaming operators. We will then conclude with some recommendations that the industry can adopt in order to make slots machine more attractive for Chinese gamers.

Keywords: Gaming, slot machines, china, marketing, macau

JEL Classification: L83

Suggested Citation

Yong, Kwek Ping and Fu, Kelvin and Chen, Eugene Chongji, Developing the Mainland Chinese Market for Slot Machines: Challenges, Opportunities and Solutions. 4th International Conference on Gaming Industry and Public Welfare, Shanghai & Macau, 2007. Available at SSRN: https://ssrn.com/abstract=1097107

Kwek Ping Yong (Contact Author)

University of Pennsylvania - The Wharton School ( email )

3641 Locust Walk
Philadelphia, PA 19104-6365
United States

Kelvin Fu

Inventis ( email )

Singapore

Eugene Chongji Chen

Inventis ( email )

Singapore

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