This report seeks to undertake an environmental analysis on the industry sector of Gold Coast theme parks. The body of the report consists of four parts. First of all, the report will have a description of Gold Coast theme Parks including its size, customer groups and core business of key players; Next, Porter's Five force model will be applied to analyze the sector's task environment; an established broad environment model is used to conduct a detailed analysis of the broad environment; finally, based n above analysis, three key strategic issues will be identified in the sector. . A description of Gold Coast Theme Parks Theme park is a kind of man-made tourism resources that focus on special conception to create a series of unique environment and atmosphere oriented on one or multiple themes so as to provide tourists with unique entertaining experience than other scenic spots (Young & Riley, 2002). 2. 1 Approximate size Tourism is the pillar industry of Gold Coast. Tourism in Gold Coast contributes 4. 4 million USED to city's economy every year and providing one in four Jobs in the city.
For the year ending June 2010, domestic overnight visitors to Gold Coast spent 3 billion SAID; domestic one day visitors spent 563 million and international visitor spent 1 billion in the Gold Coast. (Tourism Queensland, 2011) 2. 2 Customer groups The customer groups of Gold Coast can be classified as domestic visitors and international visitors. According to National Statistics of Australia, Gold Coast has received 3,396,000 domestic visitors in 2010, with a 5% rise compared to 2009. In average, the visitors will stay here for 4. 1 nights. Among them, 59. 1% are for holiday; 8. % are to visit friends or relatives, 9. 0% for business and rest are for other purposes. As for international visitors, the total amount in 2010 is 817,000, rise by 5% compared to 2009. The average stay is 9. 9 nights. Referring to their purpose of visits, 78. 1% are for holiday; 15. 2% are for visiting friends and relatives; 4. 8% are for business and the rest are for other purposes. (Tourism Queensland, 2011) Figure 2. 2 Visitor Groups of Gold Coast in 2010 [pick] 2. 3 Major Players In Gold Coast, there are famous theme parks, which are Otherworld, Sea world,
Warner Brother Movie World, Wet n Wild Water World and White Water World. (Travel Online, 2011) They attempt obtain distinctive characteristics. Otherworld is family theme park famous for the excitement of its rides, shows and attractions; Movie world also nave a varlets AT rexes, out It Dots Tort ten magic Ana excitement In ten movie world; Sea World emphasize on the contact with marine life; Wet n Wild Water World and Witt Water World are both water theme parks. Notably, the Sea World, Movie World and Wet 'n' Wild Water World are all owned by Warner Village Theme
Parks which itself is Jointly owned by Warner Brows and Village Roads. 3. Porter's Five Force Analysis 3. 1 The intensity of competitive rivalry Major competitors: In Gold Coast, there are currently five theme parks, which are Otherworld, Sea world, Warner Brother Movie World, Wet n Wild Water World and White Water World. Notably, Sea World, Movie World and Wet 'n' Wild Water World are all owned by Warner Village Theme Parks. In other words, Warner Village Theme Parks has cornered the market. Product diversity: Different theme parks may have different layout, entertainment, tour routes and revises.
Among the five parks, Wet n Wild Water World and White Water World both focus on water entertainment; Sea World focus on marine life; Otherworld and Warner Brother Movie World offers a variety of rides, shows and attractions. However, since water entertainment is seasonal. Summer is the peak season and winter is the dead season. It may causes problems such as vacant facilities, high maintenance costs, and waste of resources in winter. Exit barrier and costs shifting Since theme park is highly specialized asset with great difficulty in cost shifting.
Once he company exits the market, it will face with high exit barrier and costs. Therefore, players in this mature industry are in the state of confrontation. Based on above analysis, the intensity of competitive rivalry is high. 3. 2 The threat of the entry of new competitors Theme parks especially large theme parks are usually capital and high-technology intensive tourist attractions. It requires huge investment and long-time of construction as well as high insurance expenses. It is also difficult to change their usage once built.
In addition, new entrants may have great disadvantage in market hare and distribution channels. The conclusion, the entry barrier is high and thus the threat of the entry of new competitors is relatively low. 3. 3 The bargaining power of suppliers Equipments account for the largest proportion in the total costs of theme parks; it is also very important to the service quality. In order words, its design will affect service quality such as safety and customer's experiences. Daily maintenance is also very important. The switching cost for maintenance is high.
Therefore, most of the theme parks tend to have stable suppliers. The bargaining power of supplier is relatively high. 4. The bargaining power of customers The customer of theme parks can be classified as individual travelers, organizational Dryers, Ana resellers. Uninominal traveler Individual travelers account for over 70% of the total customers in theme parks, which is the most important market segment for theme parks. They have some characteristics: 1. The demands are large and diversified; 2. The individual consumption is low in quantity but high in frequency; 3. They preferences are usually changing.
Organizational buyers Organizational buyers refers to the companies and organizations that are arranging for group traveling, for example, reward tours of company to excellent employees and student traveling organized by schools. Their main features are: 1 . Small traveling frequency but large scale; 2. Most of them are one-time traveler; 3. The demand elasticity is relatively low; 4. They are less sensitive to price. Resellers Tourism resellers are an intermediate link between theme parks and tourists, including travel agency, travel service companies and tickets retailers.
They are the extension of theme park marketing and a important part of tourists' service experience and thus has important influence to marketing, brand image and tourist experience. In general, the total quantity of buyers is large; the consumption of individual buyer is small. Besides, since theme parks usually have different characteristics and attraction, the switching costs for customer is relatively high. Mover over, most theme parks will launch loyalty program and thus have a large number of member customers. Hence, the bargaining power of customer is relatively owe. . 5 The threat of substitute products or services The substitutes of theme parks include natural and cultural tourist attraction and other leisure entertainment places. The advance of technology gives impetus to the development of entertainment industry. The substitutes are diversified and with lower costs. In Gold Coast, as substitute for theme parks, there are natural attraction (Crumbing Wildlife Sanctuary, Tambourine National Park, South Stockbroker Island, Lamination National Park and Springbok National Park), cultural attractions (Ripple's
Believe It or Not Museum, and other entertainment spots such as Jupiter Casino and Pacific Fair Shopping Center. (Travel Online, 2011) Therefore, the threat of substitute products or services is high.