According to the Russian Association of Amusement Parks and Attractions (RAAPA), the Russian domestic industry of entertainment services consists of about 650 amusement parks and entertainment complexes and centers. They can be divided into two types: indoor and outdoor amusement parks.
Fact: Indoor amusement parks account for approximately 5 percent of the total volume of the Russian leisure entertainment industry.
Projects such as Maza Park, Galaxy Park and FUN24 (75,000–200,000 square feet) are often called market leaders in the segment of indoor entertainment parks/centers. However, the main difference between them and all of the other amusement parks is that these three are the only ones that charge a ‘single admission ticket’ (all-inclusive) – all the others operate on the individual pay-to-play model.
The “single ticket” model is common in European and American theme parks, but is quite a new concept for Russia. This all-inclusive system has helped these three market leaders to increase the amount of weekday visitors and grow profitability. The “single ticket” system allows visitors to use all of the attractions and rides in the entertainment park for the cost of the entrance fee and then pay ‘a-la-carte’ (separately) for food/drinks and games.
New – ‘Ultra All-Inclusive’ Package
Now, an even more innovative idea is being implemented in those single ticket centers – an “Ultra All-Inclusive” package, which allows visitors to enjoy a wide range of food, beverage and even hookah rooms for the price of one daily ticket. This kind of service is similar to the best world holiday resorts, but it gives the guests an opportunity to have fun, enjoy themselves and spend money in their native city without traveling abroad in order to get this type of excellent service. The ‘Ultra’ is positively impacting the development of domestic consumption and the amusement sector. Also, many people cannot afford to travel abroad, and they feel they are receiving a great value by taking advantage of these ‘one price covers all’ deals.
Paul Timets, a co-owner of each of the above-mentioned centers, is also an expert in construction and managing entertainment centers. Business Petersburg has named him as one of the best managers in St. Petersburg. Below he shares some of his thoughts about benefits and traps of the “single ticket” basis and the “ultra all-inclusive” package.
Now There Are No Limits to Having Fun!
Paul Timets’ team started using the single ticket concept in St. Petersburg about five years ago. As it showed great results, they implemented this approach in all of their other entertainment centers. Moreover, new centers in Smolensk and Kazan operated on this basis and plans were put into place to use this system in new centers that were in the planning stage.
“The target customers of entertainment parks are usually young people or students of ages 18-25, and they often can’t afford to spend a lot of money,” explained Timets. “That’s why the single ticket system works well in this case. A male guest, for example, can plan how much money he needs for a visit and invite his girlfriend, friends or relatives without been afraid that he doesn’t have enough money.”
Taking the size of the parks into account, the ticket prices are reasonable, 350-700 rubles (62 rubles/$1 USD), depending on the day of the week and time of day, and kids up to 6 years old can enter free when accompanied by a paying guest. A single ticket allows guests to use all of the entertainment attractions such as bowling, billiards, autodrome, roller skating, laser tag, etc. and enjoy their time inside until 6 p.m. (which is the center closing time in our example). The key is that each visitor can continually use any attraction during a special 2-hour period. When this special period is over, they can move on to another attraction or go to the end of a queue and continue.
The Benefits of the “Single Ticket” Basis
The entertainment centers with the standard a-la-carte basis of fee, where customers have to pay for each attraction or ride separately, usually have a higher average per person spending per visit (about 550 rubles), but these centers have fewer visitors, especially on weekdays.
Furthermore, there was one more major pitfall. Some of entertainment center’s guests came there with friends or family members only for a social experience and just walked around or bought some refreshments, but didn’t use or pay for any of the attractions.
On the other hand, centers with a single ticket entrance fee system have a lower average ticket price, about 300 rubles, depending on the region, the day of the week and time of day. This single pay system allows the center to overcome low attendance on weekdays and increase the number of visitors at non-peak times from 15-20 % up to 60-70 %. For example, the average number of guests on Saturdays is 1400, on Sundays- 1100 and now on weekdays-900 (a huge increase from where it was previously).
Timets adds that the single ticket basis has one more significant benefit – visitors tend to stay longer, increasing the length of stay from 2.5 hours to 3-4 hours, which results in them spending more money on food and drinks in order to replenish calories and keep themselves hydrated. “From the records, we can see that the average weekday visitor spends approximately 470 rubles where an entrance fee is 240 rubles and 230 rubles are spent on snacks and drinks.”
“However, the single ticket concept led us to change our accounting system and reconsider the approach to the food and restaurant service. Fast food restaurants became more popular than ordinary restaurants with waiters and a long cycle of preparing meals, as visitors began to prefer spending their time on the attractions they have paid for.”
There are some downsides to consider. The most substantial are the equipment wear. Some electronic equipment needs to be repaired more often. In many cases, it is cost effective to replace items that require frequent repairs with more durable ones. That’s why equipment must be made of very strong and high-quality materials and produced by manufacturers with good reputations.
Despite all of the single ticket system advantages, not all entertainment centers can fulfill this concept. Some of the smaller entertainment parks tried to use the Maza Park idea of all-inclusive but failed. It happened, as Paul Timets is convinced, due to the lack of attraction diversity and badly thought out visitor traffic flow. If for example, a medium size bowling center wants to implement an entrance fee and adds one or two attractions, this model will result in a decrease in the utilization and price/play for their main service, bowling. However, as the number of guests increases and there are longer waiting lines for bowling, the guests tend to spend additional money on the attractions, games, and food/beverage. The key to success is the ability for management to balance wait times and not allow them to become excessive.
Providing the diversity of attractions requires a large amount of equipment investment, which often results in an increase in the cost of a single ticket for a small business and thus could make the competitive choices of the guest more attractive for future visits.
As most equipment and technical support for our entertainment centers are purchased from foreign suppliers, the current unstable economic conditions can make new equipment too expensive for small and medium business.
As time and experience prove, only big entertainment centers with a wide range of attractions can successfully provide a single admission ticket. These ‘big boys’ are known as discounters that offer a reasonable and acceptable price for recreation which the average person can afford.
The chain of large centers Timets co-owns is an excellent example. Their premise sizes vary from 7,500 to 20,000 square meters with the amount of money invested in equipment ranging from 300 to 500 million rubles.
The Next Level of Service: The Ultra All-Inclusive Concept
The Ultra pilot project has been working well in the “Kazan FUN24” entertainment center every Friday, a special religious day. “Every guest that comes over the 800 number on this day adds profit directly to the bottom line,” Timets explained. “Because of Muslim traditions where Friday is the blessed day, a lot of bars, restaurants, and clubs are closed, so the FUN24 has virtually no competitors on Fridays.”
Kazan’s FUN24 indoor amusement park is a huge entertainment center of 10,000 square meters, operating 24/7. There are more than 30 types of indoor attractions including bowling, billiards, roller skating, autodrome, laser tag and tennis tables.
Events like flash mobs, concerts of musicians, different music bands and DJs, amateur sport competitions, and performances of the Humour TV Shows take place in FUN24. Up to 2000 people can attend the park at the same time.
The world changes very fast, technologies develop and improve everywhere in our lives. Today it is possible to have at home such amusing leisure entertainment that could not be imagined even a generation ago. In order to be successful, any business should evolve, extend and develop its good ideas, and continue working to overcome challenges which will always exist. It doesn’t matter when and where you work. In the terms of the amusement industry, the public will always desire time to socialize and play actively and effectively. Our key challenge is to make sure our entertainment centers are an affordable and high perceived value experience for every guest.
By Yaroslav Sobko, CEO Gametrade Group, Kiev, Ukraine