The game is changing for casinos in Macau as fun-seeking middle-class Chinese visitors follow high-roller VIP gamblers in ever greater numbers to try their luck in the only place in China where casinos are legal.
The growth of the so-called premium mass segment is setting the stage for what executives hope will be a second boom in Macau, where the Cotai Strip has already been paved with gold by big-spending VIP gamblers from the mainland.
The company, co-owned by Ho and Australian billionaire James Packer, said on Wednesday net income doubled in the second quarter thanks in part to strong growth in visits from members of China’s rising middle class. One of six licensed casino operators in Macau, Melco has two resorts there and is opening a new US$3 billion (HK$23.27 billion) property in mid-2015.
Melco and rivals such as US-owned Sands China and Wynn Macau have traditionally made most of their profits from wealthy customers who spend more than 1 million yuan (HK$1.27 million) each bet. But as demand from big whale gamblers ebbs amid China’s economic slowdown, casinos are increasingly vying for the lucrative upper-middle-class market.
Revenue generated by Macau’s mass segment is set to grow by 30 per cent this year compared with around 10 per cent for VIPs. In previous years VIP growth eclipsed that of the mass segment.