Why China is betting on theme parks like Legoland to boost spending

JULY 21 – Tourists flocked to China’s first Legoland theme park because it opened in Shanghai earlier this month, marking one other step within the nation’s efforts to ascertain itself as a worldwide journey vacation spot.

It is the newest amusement park to be launched in China by a Western model. Warner Brothers’ Harry Potter and Hasbro’s Peppa Pig are set to observe.

As shopper spending stays sluggish, Beijing hopes massive points of interest like this can entice guests from each China and overseas to assist revive the world’s second largest economic system.

Theme park builders are being drawn by native authorities funding however face challenges in a extremely aggressive market dominated by large names like Disney and Universal Studios.

The $550m (£410m) Legoland Shanghai is the biggest park run by the UK-based theme park operator, Merlin Entertainments.

The park is house to 75 rides throughout eight areas and buildings constructed from thousands and thousands of plastic bricks, together with a miniature model of Shanghai’s skyline.

Hundreds of holiday makers may be accommodated at its lodge, which has rooms themed round issues like pirates and castles.

The park opened after years of collaboration between Merlin, Lego’s mum or dad firm and the native authorities. They are hoping it can entice the famously frugal home inhabitants in addition to international guests.

During a ceremony to mark Legoland Shanghai’s launch, an area authority official known as it a much-needed enhance to the district’s economic system as it can create jobs and assist retailers.

State backers have additionally supported different tasks, with a government-controlled constructing agency proudly owning greater than half of Disneyland Shanghai.

Legoland and different branded parks might be eager to capitalise on enormous fanbases of kids and younger individuals, particularly in a market as massive as China, stated Xiaofeng Zeng, vp of shopper market analysis agency Niko Partners.

Despite China’s lacklustre home spending, its 1.4 billion individuals current an enormous potential market.

Recent research have proven that Chinese mother and father are splurging extra on their kids, at the same time as general shopper spending dips, Mr Zeng added.

Spending in China could at present be sluggish, however the nation’s deal with boosting native consumption make it enticing to park builders.

Tourism was among the many key focuses of China’s newest five-year financial blueprint, which promised extra resorts and theme parks.

To encourage funding Chinese authorities are providing tax breaks and different assist to finance new points of interest, stated Nandini Roy, a senior analysis analyst from Future Market Insights.

For instance, the state has backed the Legoland park with new public transport hyperlinks and main roads.

Authorities additionally rolled out 570m yuan (£59m; $80m) of subsidies by vouchers and affords as a part of a nationwide marketing campaign to spur tourism inside the nation.

“These measures decrease out-of-pocket prices for households and not directly profit parks by increased footfall,” stated Ms Nandini.

Theme parks assist herald buyers and vacationers in addition to create jobs, stated economist Gu Qingyang from the National University of Singapore.

Overseas manufacturers like Lego may even assist China to challenge a extra open and worldwide picture, he stated.

But theme parks like Legoland additionally face challenges to face out among the many roughly 400 such points of interest in China.

Influencer Artem Kapnin, who visited Legoland Shanghai throughout a preview in June, stated it had clearly made efforts to cater to Chinese audiences however lacked the ambiance of Disneyland.

“I personally love Disneyland extra due to the overall ambiance within the park, the characters, and I actually benefit from the firework shows,” stated Mr Kapnin, a scholar primarily based there.

Although shopper spending in China stays sluggish, Prof Gu says buyers are eyeing this huge nation’s financial prospects a few years into the long run.

“It’s necessary to notice that constructing a large-scale theme park typically takes near a decade – so a long-term perspective is crucial.”