Mass VS VIP Gaming in Macau

For many years now, Macau has been home to the largest casinos and malls in China hence the tag Asia’s Las Vegas. However, it is a common and accepted belief by the community that authorities prefer mass gambling over VIP gaming. To set the record straight, Ben Lee who is a managing partner in one of the prominent gaming management and consulting companies said that all the Chinese government wants is to transform the gaming sector to a non-gaming one. After all, it would not prefer a system in which the poor are taken over by the high-class people. He says that the move is essential since the revenue generated by the non-gaming sector is way too little in comparison to the one created by the same industry in America.

It’s a game of ups and downs

Even with the common belief being that Mass is preferred over VIP, the two have been shifting positions with VIP gaming outdoing mass something that last took place in 2011. For instance, in the first six months on 2017, VIP rose by 30% while mass gaming growth was way lower taking 14% only. Nonetheless, the latter is much more stable even when its growth rate is low as it tends to have a much stronger base in comparison to its competitor which usually comprises of a few rich people brought in by the junkets. Reason being, most people bet on the middle class which is what the authorities want.

More profitable

Even with VIP taking the lead, casino owners and operators still prefer mass since the profit it earns them is three times more because the players tend to spend even more on rooms and meals. That means they get to make even more money. Through the money earned from this, they now can set up more non-gaming facilities which will attract even more tourists to the city of Macau hence more revenue from the non-gaming sector. However, even with the myriad benefits that come with mass, it is not easy for them to give up on VIP since it tends to be less risky. When it comes to VIP, such operators tend to provide the floor and the tables while the junkets provide them with the rest. That means fewer risks and costs as well since all they do is collect the markers.

Battle of the cards

VIP gaming is not affected by the curb on bank cards in Macau, and that is what has led to its incredible growth lately. Praveen, a distinguished analyst, says that it is a risk to the premium mass gaming market. For instance, revenue from two casinos which boast the highest number of mass players reduced tremendously since the restriction on the cards was placed while at the same time increased in VIP. That is why junkets such as Neptune and Sun City are now in control on almost 80% of the market while the ones who had closed down in the past like Hengsheng are now reopening. Conversely, the Chinese government says that it’s not targeting any sector and it will soon launch a crackdown on the junkets using the bank cards and ATM’s just like it did with the mass gaming segment.