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Htm2120 sem006-g3-8 apr 2014 (1)

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Jennifer Fungyuenshan
Jennifer Fungyuenshan

1) The document discusses factors affecting the demand and supply of theme parks in Hong Kong, including purchasing power, value added experiences, advertising, and population trends from mainland China. It finds that all of these factors are contributing to an increase in demand. 2) It analyzes the internal strengths of Hong Kong theme parks, such as diverse entertainment options and accessibility, as well as external factors like competitive environment and social/cultural influences like an aging population. 3) The document forecasts that demand for theme parks in Hong Kong will generally increase in the future due to rising purchasing power from mainland Chinese tourists, greater numbers of mainland visitors, and new attractions being added at both Hong Kong Disneyland and Ocean Park.

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Name: Au Sau Man Amber 13108309D Chan Ching Wa Kennis 13113777D Fung Yuen Shan Jennifer 12040884D Lau Ka Ching Pinky 13108261D Leung Suet Yee Cher 13108507D Pang Choi Yi Josie 13108291D HTM2120 Tourism Attractions Attractions- Theme Park 1 Seminar group: 006 Project group number: 3 Presentation date: 8th April, 2014
Introduction 2
3 ? Identify the supply and demand factor of theme park industry ? Evaluate the internal and external through C-PEST framework ? Analyze the market structure in theme park industry ? Forecast the demand in this industry Objectives
Factors Affecting the Demand for Theme Parks ? Purchasing power ? Value added ? Advertising ? Population
Purchasing power ? Profits for Hong Kong Disneyland and Ocean Park: mainly supported by tourists from mainland China ? ?Purchasing power of them is highly influential ? Exchange rate of RMB will continue to appreciate (Zhou, 2013) ? ?Higher purchasing power ? Demand
Value added ? Expand in the coming years ? Ocean Park: a new animal attractions called Adventures in Australia in Dec,2014 ? Hong Kong Disneyland: a new Marvel- themed area in late 2016 ? Value for visiting will increase ? Demand
Advertising ? When Ocean Park opened Amazing Asian Animals, it released lots of promotions ? E.g. television commercial, MTR ads ? Expected: both theme parks will increase their advertisements quantities once they release new attractions ? Demand
Population C Visitors from Chinese Mainland ? Both: targeting visitors from Mainland China as one of the major market segments ? Increasing trend in the number of visitors coming from Mainland China ? + 24.2% (2011 - 2012) ? +16.7% (2012 C 2013) ? The target market will expand ? Demand
Generally ? All the above factors are contributing to an increase of the demand for theme parks ? ? Demand for the theme parks in Hong Kong ? ? Equilibrium price and equilibrium quantity
10 Factors Affecting the Supply for Theme Parks
11 ? 30 new attractions in OP ? Ocean Hotel, Water World project ? ?capacity ? ? supply ? Expected higher demand with the new facilitates ? ?demand > ?supply ? ? P, ? Qd Expansion of park
12 ? New Disney hotel in 2017 (750 rooms) ? ?capacity ? ? supply ? new room rate = HKD$2,100, a price between the existing two hotels (Lo, 2014) ? ? Qd, but P?? (2 cases) ? ? supply > ?demand ? ?P ? ?demand > ?supply ? ?P Expansion of park (Cont) ? S > ? D ? D > ? S
13 ? DLHK got HK$809m loan from government ? Purpose: construction of the third hotel ? ?financial ability for expansion ? ?supply of service Favorable government policy Money?
14 Internal Environment
Strength--All round entertainment ? DLHK and OP provide various entertaining elements to enhance visitors experience Thrilling Experience Fun Experience Cultural Experience Animal Encounter Experience 15
Strength--High Accessibility ? Hong Kong Disneyland connected with MTR (Sunny Bay station) ? Ocean Park connected by Citybus at Admiralty MTR Station ***Construction South Island Line (East) C Ocean Park Station will be completed in 2015 16
Strength-- Popularity & Strong Brand Awareness TEA Global Attractions Attendance Report in 2012 ? DLHK and OP are internationally well- known theme park ? Strategic global marketing strategies i.e. Disney promote their brand via Disney film and Disney channel 17
Weakness--Overcrowding ? Limited flat land in HK ?DLHK is the smallest among Disneyland in the world ? Majority visitor would skip the ride if the waiting time is over 30 minutes (SCMP, 2014) ?Reduce the attractiveness of theme park 18
19 External Environment- C-PEST
Competitive Environment ? Porter's Five Forces of Competitive Position Analysis by Michael Porter (1980) is used ? Evaluate the competitive intensity and attractiveness of Hong Kong theme park industry 20
Competitive Environment Threat of new entrant: Low ? Significant investment is needed ? Limited space of Hong Kong ? Ocean Park:870,000 square meters of land ? Disneyland:27.4 hectares of land ? The estimated total project cost of developing HKDL Phase I was HK$14.1 billion (Legislative Council Secretariat, 2008) 21
Competitive Environment Threat of substitutes: Low (HK) ? Substitute are service or product provide similar features : Fun & Educational ? The substitutes would be museums and zoo ? Do not offer theme park experience Low threat 22
Competitive Environment Threat of substitutes: Intense (Worldwide) ? More theme parks will open ? e.g. 12 new theme parks and one water park opened in 2012-2013 (China Theme Park Pipeline Report 2013) ? Target similar market & share similar features ? e.g. Shanghai Disneyland & Zhuhai Ocean Kingdom Increase the threat 23
Competitive Environment The power of Supplier : Medium ? Vendors (F&B, toy, cloth): Low ? Many suppliers are available in the market ? Construction Company & technology supplier: Medium ? Intensive investment ? Require support and maintenance 24
Competitive Environment The power of Buyer : Low ? No substitutes offer theme park experience in HK market ? Theme parks have the control of price 25
Competitive Environment Competitive Rivalry: Not intense ? Difficult to enter into the market ? No substitutes offer theme park experience in HK ? However, the competitive rivalry is intense among the global scope 26
27
Social-Cultural Factor Aging population ? Impact on : ? Demographic profile and target market ? Labor force 28
Social-cultural Factor Hong Kong ? The number of elder aged 65 and above would increase from the current 1 million to 2.6 million in 2041 (Census and Statistics Department, 2011) ? The median age would also increased from 43 to 52 (Census and Statistics Department, 2011) Mainland China ? More than a quarter of the population aged 65 years old by 2050 (Chinese Academy of Social Sciences 2010) 29
30 ? Oligopoly ? (A small numbers of sellers/ Oligopolists) ? Hong Kong Ocean Park, Noahs Ark, Hong Kong Disneyland ? interdependent for others and both have influence for the decisions of others ? high barriers to entry ? building cost ,licenses Market Structure
31 ? General increasing demand in the future ( both parks expected) 1. Increasing purchasing power of mainland tourists ? ? Rise of RMB ? ?Same RMB, more HKD Demand Forecast
2. Increasing numbers of mainland tourists ? General increase of number of mainland tourists ? favorable policies such as CEPA and less barriers for tourists from inner region of China will enable more tourists visit Hong Kong Demand Forecast 32 Source: HONG KONG DISNEYLAND ANNUAL BUSINESS REVIEW FOR THE FISCAL YEAR 2011-2013 Source: HONG KONG DISNEYLAND ANNUAL BUSINESS REVIEW FOR THE FISCAL YEAR 2011-2013
? 3. New Attractions for both parks ? HKDL: New nighttime spectacular : Disney Paint the Night" in 2014Marvel's Iron Man franchise in late 2016. ? OP: shark Mystique will open in the end of 2014 Demand Forecast 33
? Optimistic ? Many favorable factors ? Mainland tourist becomes more significant ? Attention for the trend of increasing number of theme park and aging population Conclusion 34
35 Thank you. End

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Htm2120 sem006-g3-8 apr 2014 (1)

  • 1. Name: Au Sau Man Amber 13108309D Chan Ching Wa Kennis 13113777D Fung Yuen Shan Jennifer 12040884D Lau Ka Ching Pinky 13108261D Leung Suet Yee Cher 13108507D Pang Choi Yi Josie 13108291D HTM2120 Tourism Attractions Attractions- Theme Park 1 Seminar group: 006 Project group number: 3 Presentation date: 8th April, 2014
  • 3. 3 ? Identify the supply and demand factor of theme park industry ? Evaluate the internal and external through C-PEST framework ? Analyze the market structure in theme park industry ? Forecast the demand in this industry Objectives
  • 4. Factors Affecting the Demand for Theme Parks ? Purchasing power ? Value added ? Advertising ? Population
  • 5. Purchasing power ? Profits for Hong Kong Disneyland and Ocean Park: mainly supported by tourists from mainland China ? ?Purchasing power of them is highly influential ? Exchange rate of RMB will continue to appreciate (Zhou, 2013) ? ?Higher purchasing power ? Demand
  • 6. Value added ? Expand in the coming years ? Ocean Park: a new animal attractions called Adventures in Australia in Dec,2014 ? Hong Kong Disneyland: a new Marvel- themed area in late 2016 ? Value for visiting will increase ? Demand
  • 7. Advertising ? When Ocean Park opened Amazing Asian Animals, it released lots of promotions ? E.g. television commercial, MTR ads ? Expected: both theme parks will increase their advertisements quantities once they release new attractions ? Demand
  • 8. Population C Visitors from Chinese Mainland ? Both: targeting visitors from Mainland China as one of the major market segments ? Increasing trend in the number of visitors coming from Mainland China ? + 24.2% (2011 - 2012) ? +16.7% (2012 C 2013) ? The target market will expand ? Demand
  • 9. Generally ? All the above factors are contributing to an increase of the demand for theme parks ? ? Demand for the theme parks in Hong Kong ? ? Equilibrium price and equilibrium quantity
  • 10. 10 Factors Affecting the Supply for Theme Parks
  • 11. 11 ? 30 new attractions in OP ? Ocean Hotel, Water World project ? ?capacity ? ? supply ? Expected higher demand with the new facilitates ? ?demand > ?supply ? ? P, ? Qd Expansion of park
  • 12. 12 ? New Disney hotel in 2017 (750 rooms) ? ?capacity ? ? supply ? new room rate = HKD$2,100, a price between the existing two hotels (Lo, 2014) ? ? Qd, but P?? (2 cases) ? ? supply > ?demand ? ?P ? ?demand > ?supply ? ?P Expansion of park (Cont) ? S > ? D ? D > ? S
  • 13. 13 ? DLHK got HK$809m loan from government ? Purpose: construction of the third hotel ? ?financial ability for expansion ? ?supply of service Favorable government policy Money?
  • 15. Strength--All round entertainment ? DLHK and OP provide various entertaining elements to enhance visitors experience Thrilling Experience Fun Experience Cultural Experience Animal Encounter Experience 15
  • 16. Strength--High Accessibility ? Hong Kong Disneyland connected with MTR (Sunny Bay station) ? Ocean Park connected by Citybus at Admiralty MTR Station ***Construction South Island Line (East) C Ocean Park Station will be completed in 2015 16
  • 17. Strength-- Popularity & Strong Brand Awareness TEA Global Attractions Attendance Report in 2012 ? DLHK and OP are internationally well- known theme park ? Strategic global marketing strategies i.e. Disney promote their brand via Disney film and Disney channel 17
  • 18. Weakness--Overcrowding ? Limited flat land in HK ?DLHK is the smallest among Disneyland in the world ? Majority visitor would skip the ride if the waiting time is over 30 minutes (SCMP, 2014) ?Reduce the attractiveness of theme park 18
  • 20. Competitive Environment ? Porter's Five Forces of Competitive Position Analysis by Michael Porter (1980) is used ? Evaluate the competitive intensity and attractiveness of Hong Kong theme park industry 20
  • 21. Competitive Environment Threat of new entrant: Low ? Significant investment is needed ? Limited space of Hong Kong ? Ocean Park:870,000 square meters of land ? Disneyland:27.4 hectares of land ? The estimated total project cost of developing HKDL Phase I was HK$14.1 billion (Legislative Council Secretariat, 2008) 21
  • 22. Competitive Environment Threat of substitutes: Low (HK) ? Substitute are service or product provide similar features : Fun & Educational ? The substitutes would be museums and zoo ? Do not offer theme park experience Low threat 22
  • 23. Competitive Environment Threat of substitutes: Intense (Worldwide) ? More theme parks will open ? e.g. 12 new theme parks and one water park opened in 2012-2013 (China Theme Park Pipeline Report 2013) ? Target similar market & share similar features ? e.g. Shanghai Disneyland & Zhuhai Ocean Kingdom Increase the threat 23
  • 24. Competitive Environment The power of Supplier : Medium ? Vendors (F&B, toy, cloth): Low ? Many suppliers are available in the market ? Construction Company & technology supplier: Medium ? Intensive investment ? Require support and maintenance 24
  • 25. Competitive Environment The power of Buyer : Low ? No substitutes offer theme park experience in HK market ? Theme parks have the control of price 25
  • 26. Competitive Environment Competitive Rivalry: Not intense ? Difficult to enter into the market ? No substitutes offer theme park experience in HK ? However, the competitive rivalry is intense among the global scope 26
  • 27. 27
  • 28. Social-Cultural Factor Aging population ? Impact on : ? Demographic profile and target market ? Labor force 28
  • 29. Social-cultural Factor Hong Kong ? The number of elder aged 65 and above would increase from the current 1 million to 2.6 million in 2041 (Census and Statistics Department, 2011) ? The median age would also increased from 43 to 52 (Census and Statistics Department, 2011) Mainland China ? More than a quarter of the population aged 65 years old by 2050 (Chinese Academy of Social Sciences 2010) 29
  • 30. 30 ? Oligopoly ? (A small numbers of sellers/ Oligopolists) ? Hong Kong Ocean Park, Noahs Ark, Hong Kong Disneyland ? interdependent for others and both have influence for the decisions of others ? high barriers to entry ? building cost ,licenses Market Structure
  • 31. 31 ? General increasing demand in the future ( both parks expected) 1. Increasing purchasing power of mainland tourists ? ? Rise of RMB ? ?Same RMB, more HKD Demand Forecast
  • 32. 2. Increasing numbers of mainland tourists ? General increase of number of mainland tourists ? favorable policies such as CEPA and less barriers for tourists from inner region of China will enable more tourists visit Hong Kong Demand Forecast 32 Source: HONG KONG DISNEYLAND ANNUAL BUSINESS REVIEW FOR THE FISCAL YEAR 2011-2013 Source: HONG KONG DISNEYLAND ANNUAL BUSINESS REVIEW FOR THE FISCAL YEAR 2011-2013
  • 33. ? 3. New Attractions for both parks ? HKDL: New nighttime spectacular : Disney Paint the Night" in 2014Marvel's Iron Man franchise in late 2016. ? OP: shark Mystique will open in the end of 2014 Demand Forecast 33
  • 34. ? Optimistic ? Many favorable factors ? Mainland tourist becomes more significant ? Attention for the trend of increasing number of theme park and aging population Conclusion 34