Roll up, roll up – the circus is in town. Only it’s not the circus as history knows it. I’m talking about the modern version – theme parks, which are playing an increasingly important role in driving global tourism, especially in Asia.
There’s not another tourism category that works harder for its business with consistent reinvention and aggressive, creative marketing the core mantras.
Never has this been more obvious than the past year, a tough 12 months for the Australian industry thanks largely to its geographic focus on the Gold Coast.
The Queensland holiday strip has been doing it tough and this has been reflected in the recent performance of the two big players – Village Roadshow and Ardent Leisure.
Village owns Movie World, Sea World and Wet ‘n’ Wild, while arch rival Ardent Leisure operates Dreamworld and Whitewater World.
The two fought it out tooth and nail in the first half of this year with a price discounting war stimulating demand – attendance at Ardent Leisure parks were up 30% to 2.7m – but hitting revenue with reduced profits for both operators.
Still, they made pretty good money, all things considered, demonstrating that well-run theme parks are not the rollercoaster ride some may think.
Village Roadshow’s theme park division, which also includes Australian Outback Spectacular, Paradise Country, Village Roadshow Studios, Sea World Resort and two USA water parks – earned $87.2 million before tax last year.
Ardent made $32 million at an operating margin of 33 per cent, better than plenty of other industries where the instinctive reaction would be to batten down the hatches and ride it out the tough times.
However, that is not an option for theme park operators. In fact the reverse is true. For them it is time to talk things up and begin the process of reinvention – again.
Ardent has been particularly aggressive, rolling out two new rides – Shockwave and Buzzsaw – and last week announced a new partnership with scenes with DreamWorks Animation.
Ardent Leisure CEO Greg Shaw hopes sees it as a game changer giving Dreamworld exclusive access to DreamWorks characters Shrek, Puss in Boots, Po the Panda and Alex the Lion.
This is big news for kids, apparently, who Mr Shaw hopes will drag their parents along to experience the newly developed DreamWork Experience precinct, due to be finished by Easter, where “guests of all ages will be invited to step into the story and come face to face with their favourite animated heroes”.
Mr Shaw says he believes the Dreanmworks partnership will reinvigorate Dreamworld.
“I think the key to our business is continually creating new products and new experiences,” Mr Shaw says.
“We’re very hopeful we will see the market rebound and are looking for some improved results.”
Ardent has also increased its pricing and is looking to improve yields on the back of the new attractions.
One thing is for sure, the Village Roadshow theme parks, which spends “tens of millions on marketing” every year, will aim up and match the DreamWorks cartoon characters with a few of their own.
This summer it will be Shrek versus SpongeBob SquarePants, Puss in Boots up against Dora the Explorer.
There’s also a new ride – the Green lantern Coaster at Movie World – which launches in December.
Joking aside, General Manager of Movie World and Global Head of Marketing for Village Roadshow theme parks, Bob White, says new attractions are a fact of life for the industry to keep guests interested.
He says visitations remain good and the Village has had a lot of success with its multi-park ticketing strategy in upselling customers – a single ticket costs $79 while you can get a two-week two-park pass for $99.
What are you going to do?
This pricing approach also lifts auxiliary revenue through extra onsite sales of everything from drinks to cabanas, while Village is also saving on ticket distribution costs with 43% of ticket sales now made through its MyFun website.
White says good times lie ahead despite the uncertain economic environment and changing travel patterns.
Village has show its continued faith in the sector by proceeding with plans to develop a new Wet ‘n’ Wild in western Sydney.
Development is scheduled to start next year and the company says it is exploring further opportunities in Australia, Asia and the United States,
As always, the show must go on.
This article first appeared in The Weekend Australian