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Economic Analysis of Theme Park Industry in Hong Kong

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Winnie IpTszMan

on 1 April 2014

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Transcript of Economic Analysis of Theme Park Industry in Hong Kong

Economic Analysis of Theme Park Industry in Hong Kong
Competitive Factor
Social Cultural factor
Technological factor
Conclusion
Current Market Situation
Supply Factor
Demand Factor
Brainstorming
Supply and demand
Comparison within the industry
Market structure
Internal Operating Analysis
External Operating Analysis
Forecast Demand
Objective :
Analysis of the market condition of Theme Park Industry in Hong Kong should be done first
before making any decision
Theme Park
Price
Quantity
Equilibrium
P*
Q*
S
D
Main factor
Expansion project / the addition of new facilities
Ocean Park launched a six-year Master Redevelopment Plan
increased its facility unit to 85
the development of the new Water World bring 25 facilities to the park
( size and number of facilities of theme parks )
the capacity of theme parks
the theme parks’ capability
Example:
Main Factor
Income and preference
( affect visitors' willingness to visit the parks their purchasing ability of tickets )
Income
Salaries were estimated to increase by 7.3 percent to 9.5 percent in 2014
demand
Market Structure
Operating Environment
Internal Analysis
External Analysis
Dramastic Increase of Demand
Benefits from the government support in the future
Fantasy
VS
Theme park is aiming to provide the atmosphere of another world for visitors
The atmosphere is very important in order to attract visitors
Themes can be categorized as adventure, futurism, international, nature, fantasy, history, culture and movie
Nature
Magical Memories
Political Factor
Economical Factor
Several powerful rivals in the Asia-Pacific region
Theme park industry benefits from the closer arrangement--the individual visit scheme
It was first introduced in July of 2003
Tourists from Beijing, Shanghai and eight cities in Guangdong Provinces were the first parts of Mainland China to enjoy the scheme.

the number of arrivals from the Mainland China recorded dramatically growth
The introduction of the Closer Economic Partnership Arrangement in 2003
Individual Visit Scheme

Hong Kong economy grew up in year 2013 after suffering of the financial tsunami
The exchange rate of Hong Kong currency is link with the US dollar
the exchange rate of the US dollar with RMB is weak
it creates an opportunity for the Hong Kong tourism industry
visitors from other countries enjoy the high exchange rate in Hong Kong
The labor market in Hong Kong is fully employed
The unemployment rate drop down to 3.3 percent
an “anti-locust” campaign on 18 February 2014 in TST distinct
Mainland visitors would choose other destinations instead of Hong Kong
Hong Kong is a city mixed up of eastern and western cultures
Buddhist and Christian, minority are Jewish and Muslim
different religions and cultures come up with different festivals
The resentment between Hong Kong residents and Chinese visitors reaches a high level
Hong Kong Ocean Park and Disneyland can sell the tickets through the official website.
Other forms of information communication technology
Can help to reduce the cost as application can serve as the map instead of using traditional paper maps
Advanced technology facilitates the operation of theme park industry in Hong Kong
Forecast Demand for industry
A huge re-investment and government support is needed
the change of demand
The total inbound tourist arrivals to Hong Kong will reach
supply should be increased
the change of supply
the numbers of visitors to Hong Kong theme parks expects to be increased for the future years.
The no. of tourist arrivals to Hong Kong is forecast to


increase by 10.18%
per year on average from 2010 to 2020.

95 million by 2020 from 36 million in 2010.

Creates thousands of jobs
Require more workers to carry out the construction work and support the theme park operation

Enjoy new facilities and having fun in a larger size area
Increase the numbers of visitors
Decrease the Unemployment rate
Economic benefits
Hong Kong Disneyland's reputation has been enhanced after the construction of Toy Story Land
which is the only one of its kind in the world
enhances Hong Kong international image
retailing, beverage and other service industries in Hong Kong
brings favorable effects to the Hong Kong economy
Development of new theme parks or expansion of both two existing parks is needed
Getting funds from government is a milestone for the future of Hong Kong !
Due to the rapid growth rate of tourist arrivals in the following years
Oligopoly
A few large firm
Differentiated Product
Some entry Barriers
- Large scale & popularity of existing firms
- Substantial investment
e.g. facility construction
personnel recruitment
land reclamation (Penny’s Bay)
Non-price competition
Interdependence
Ocean Park
- Youngsters
- Exciting rides
- Animal exhibitions & shows
- Fusion
- Care and respect to nature
Hong Kong Disneyland

- Children / Families
- 7 different themed areas
- Rides, parades, shows & celebrations
- Fantasy, fun & delight
- Interaction with Disney cartoon characters
Exert influence on each other
e.g. price
new product concept
promotional strategies
Steady price
Competition on non-price elements
Advertisement
e.g. Ocean Park 38%
Hong Kong Disneyland even doubled
Full transcript