HTM3209 Attractions and Visitor Management

HTM3209 Attractions and Visitor Management
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Summary

Following Hong Kong Ocean Park’s announcement of an operating deficit in the coronavirus period, this proposal suggests a new attraction named “Screaming through the Silence” in hopes to improve the park’s competitiveness in the market. The proposal begins with a swot analysis to identify Ocean Park’s strengths, weaknesses, opportunities and threats. Combining the park’s strength of accessibility, strategic planning as well as the opportunity that consumers are craving a chance to travel, but considering weaknesses such as operating cost and the threat of covid Restriction Order, our proposed attraction aims to provide an innovative experience for targeted customers – young locals. We have differentiated our attraction as we will create a scary atmosphere through silence as opposed to the traditional haunted attractions with loud music, hence the attraction’s name – “Screaming through the Silence”, located at the same place where this year’s attraction ” Survivor of the Undeaded” has been setup. With a theme of Hong Kong urban legends, rooms with different storylines are designed to allow participants to immerse themselves in the stories. In the report, standard operating procedures are described, queue management is also considered to ensure a smooth operation. It is expected the new attraction can enhance Ocean Park’s profit and reputation.

Introduction

The global pandemic has created inevitable impacts on different industries, including the theme park industry since 2019. One of the largest theme parks in Asia – Hong Kong Ocean Park reported its operating deficit with a significant decrease in visitor numbers in its latest annual report in 2020 (Magramo, 2020). Ocean Park’s Halloween Fest has been the most popular annual event of Ocean Park since its launch in 2001 (Ocean Park, 2007), this proposal aims to introduce the new attraction idea – “Screaming through the Silence”. To support the proposed idea, a SWOT analysis will be performed, followed by additional research on the market segmentation. Details and rationale behind the idea will be explained, and conclusion will be drawn at the end.

Methodology

To justify the proposed idea of the new attraction, swot analysis is carried out based on  secondary data collected from various sources with insights from our first-hand visit experience to the Halloween Fest. The evaluation of market segmentation will help us determine targeted customers of the proposed idea, both quantitative data and qualitative data are used.

Company Background

Located in the southern district of Hong Kong Island, covering an area of over 91.5 hectares, Hong Kong Ocean Park has been operating for 44 years since 1977. It has been operated by a public corporation as appointed by the Hong Kong Government under the statutory board. Ocean Park is a financially independent organisation. Its revenue model is mainly based on entrance fees, followed by catering income as well as merchandise income. It is Hong Kong’s second-largest theme park. As a premier educational theme park, it aims to provide entertainment and to promote the conservation of wildlife animals and marine life. By the end of the financial year 2020, the park has reported an operating deficit of approximately HK$562M for the first time since 2015 due to the coronavirus pandemic (Ocean Park HK, 2021). In order to sustain operations, Ocean Park was granted HK$5.4 billion from the Legislative Council after re-opening in February 2021 for a one-year operation. But its financial situation is still pessimistic and affected by the drop in the city’s inbound tourists.

High Accessibility – Ocean Park is proximal to the city center. It takes only 3 minutes to walk to the entrance from the nearest MTR station. Visitors can easily get to Ocean Park by all means of transport. Its convenient location generates great attractiveness for potential customers.

Strategic Pricing – Since the opening, the ticket price of Ocean Park has been lower than Hong Kong Disneyland, which makes it a more economical option. Moreover, it has announced that it will be restructuring its revenue model and charge on usage basis in the future, which strategically would make Ocean Park more competitive in the market.

Special Festival Events – Ocean Park has been popular for its seasonal events. Over the decade, Ocean Park would organise specific festive events in different periods. From which, Halloween Fest is the most well-known.

High Operating Cost – Ocean Park has been subjected to a large amount of fixed overheads on its  salary expense, interest costs on loans as well as depreciation of property, plants and equipment. Despite a great decline in visitor arrivals in 2020, Ocean Park’s operating costs are still high; around HK$1.28 billion (Ocean Park HK, 2021). High fixed costs have been significantly impacting the park’s profitability and the liquidity. It is critical that Ocean Park improves control of its costs while opening up its revenue streams sustainably to finance its operations besides relying on government funding.

Lack of Renovation – Ocean Park opened in 1977 with cable cars, roller coaster and dolphin show as the major attractions. Since then, new exhibitions have been launched, but the traditional infrastructure has not changed. Old facilities may not be attractive enough to repeated visitors.

Low Brand Recognition – Unlike Hong Kong Disneyland, Hong Kong Ocean Park is a local brand in the international theme park market. It does not have high brand awareness or any intellectual property like Disney’s Mickey Mouse. Improved marketing and service design is needed to establish a stronger brand image for long-term development.

Crave for Travel – Locals used to take 2.7 trips per year (ejinsight, 2018). However, under the coronavirus pandemic, they are not allowed to travel abroad. Locals thus have great desire for entertainment, particularly interested in visits to amusement parks or theme parks (GEM Partners, 2020). Ocean Park could serve as a substitute for travel. Guests would visit the park for leisure and to escape from urban life.