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Location-based Entertainment

Remember "cocooning"? Remember the pundits of the 1980s and 1990s who predicted that most of humankind, tired of working themselves to the bone, never setting eyes on their loved ones, slaving to get that food on the table, were going to march themselves into the living room, armed with videotapes, microwave popcorn, and their beverage of choice, plop themselves in front of that cable-fed home theater with 60" screen, surround–sound, and four-head VCR with stop action for special effects, settle into that lounge chair, surrounded by the ones they loved, and never venture out into the real world again until the next work minute? Remember cocooning and how everyone was going to stay tucked in nice and comfy at home? Oh, woe was the out-of-home entertainment industry to the prophets of the late 20th Century!

Guess what? It seems as though there was a slight miscalculation. It appears that the same species that invited Fred and Wilma out for a night by the tribal fire, that crowded the Globe Theater to sneak a peak at Will Shakespeare's latest scratchings, and that found a nickel or two in the midst of the greatest depression the world has ever seen to spend on a movie just didn't want to prop those legs up in the old recliner for very long after all. Lo and behold, it seems as though the vast array of home entertainment equipment sold in the last decade may have only served to up the ante in the public's demand to be entertained everywhere they go.

This increased desire for sensory stimulation is everywhere we look. Been to a professional basketball game lately? No longer do the players simply run onto the court, possibly greeted by Dallas Cowboy Cheerleader clones. Nope. Now they sprint onto the floor in the spotlight, strobes flashing, bass-line pumping, INDOOR FIREWORKS BLASTING! Local newspapers? No staid, grand old "Gray Lady" anymore; she's been replaced by four-color photos, one-page stories, charts, graphs, and sidebars all ablaze in quick, colorful eyebites, a circus in print. Clothing? Niketown, with shoes, clothes, multimedia projection and full size basketball court! Airports? TVs in the waiting areas to relieve the boredom (and sell the product). Food courts, childrens play areas and retail shops that outdo local malls! And the local mall? Festival marketplaces! Mall of America, with seven acres of Camp Snoopy!

All of this is driven by the fact that humans are generally gregarious by nature. We want to rub shoulders with each other, for a million different reasons. And if we can rub shoulders, eat dinner, see a movie, and pick up a new pair of jeans, all in the same fell swoop, well that's even better, because the prophets were partially right. We don't have much free time, and we do want to spend some portion of it with our family. We just seem to want a choice between the lounge chair and a public venue—but it better be a GREAT public venue, one that entertains, edu-tains, and, most likely, eat-ertains.

This is not front-page, stop-the-presses news. In the last two decades, our desire for entertainment has fed not only the theme and amusement park industry, but has spun off smaller, locally based endeavors as well. Fueled by such prognosticators as Entrepreneur magazine, family and children's entertainment centers (FECs and CECs) appeared on (and in many cases, disappeared from) what seemed to be every corner lot and strip mall in the country.

Amusements Come of Age

Typically, FECs took the form of multi-attraction-driven destinations, including everything from miniature golf and go-karts to video games, motion-based simulators, laser tag, and redemption games (which did not promise a trip to heaven; they spit out tickets, which could be redeemed for trinkets based on the number of points scored).

FECs capitalized on what was being called the "Echo Baby Boom," the rise in birth rate associated with Boomers having offspring. Because many of those Boomers waited until later in life to have children, their child-bearing coincided with that of the 20-something people who also were in a family way, creating a larger generation than the Boomers themselves.

Families, hungry for things to do together, swarmed to these facilities. However, in time, teenagers often took over, which left some parents uncomfortable with bringing their children to the FEC. Several entrepreneurs saw opportunity in this trend, and soon a new niche was born: the children's entertainment center (CEC). CECs typically focused on a large, soft, modular play system, resembling a gerbil cage on steroids, surrounded by the same redemption games found in FECs. Food, in the form of pizza and hot dogs, was also offered.

These facilities multiplied like rabbits, the most prolific being Discovery Zone, which reached a peak at over 300 locations. Chuck E. Cheese was another entrant in the race; while the attraction offering was similar, Chuck E. Cheese included one other element that seemed to help repeat visitation at the parental level: beer. Since most children are not given access to the family car, Chuck E. Cheese understood that something had to bring parents back time after time. The strategy apparently worked. Discovery Zone, poorly managed and too thinly spread, collapsed in bankruptcy; Chuck E. Cheese continues to pack them in.

In general, though, parents eventually took a look around and realized that there were other destinations in the neighborhood that could offer a more educational experience to their kids—museums and heritage destinations—and off they went, in search of something the kids could get some value out of. However, now the children seemed to need more than a wax Indian standing over a stuffed buffalo or the world's largest ball of tinfoil. "AHA!!" said the entrepreneur and design community. We can't simply educate them!! We need to entertain them while they learn!! Thus was born the concept of "edu-tainment," a trend that has spread like butter on hot popcorn, eventually finding its way into the corporate plant tours and retail establishments we will discuss in the next section.

Enter the Big Boys

Investors in these FEC and CEC projects ranged from moms and pops and downsized corporate executives to high rollers such as McDonald's Corporation and Blockbuster Video. As the shakeout of the me-toos occurred, the number of small investors thinned down considerably. However, the intent of both the successful and not-so-successful projects was not lost on some very big players.

These investors included the biggest names in retail, restaurant, and real-estate development. And, of course, there was the entertainment community. With an eye on leveraging brand equity, creating outposts for products, and increasing brand awareness, entertainment companies such as MCA Universal, Sega, Sony, SKG DreamWorks, and Disney investigated new ways to combine the entertainment experience with location-based products. With years of experience in inviting the public in and coaxing the dollars out, these players brought some intriguing new destinations to cities around the U.S., and, in some cases, the world.

However, unlike the FECs of the last decade, these giants paid more attention to the retail mall model, creating location-based entertainment (LBE) products to combine with other synergistic and often competing venues. LBEs took the traditional paradigm of the FEC—coin-operated amusements, video games, and food—and blew this segment into the 21st Century. Examples, usually designed with the 18–34 set in mind, include Dave and Buster's, which is essentially a high-quality sports bar/restaurant surrounded by adult-level redemption games and billiards, and its clone, Jillian's. Disney jumped onboard in Orlando and Chicago with DisneyQuest, their version of an indoor amusement park, featuring Disney-related activities based on animation, as well as custom-designed virtual rides. Sega, best known for coin-op games, partnered with MCA Universal and SKG DreamWorks to create GameWorks, a concept that combined food and entertainment with a high-end range of games and experience simulation, packaged in a highly themed environment built to look like the inside of an old factory.

By combining large-scale retail, food, entertainment, and attraction elements in environments that screamed WOW, real-estate developers attempted to create new destinations known as urban entertainment centers (UECs). Like the retailers who leased space in malls, these companies thought they could find strength in numbers. UECs were created through "co-opetition": businesses creating new ecosystems by working together to optimize the opportunities in locations ranging from the Cleveland waterfront to Coconut Grove. The goal was to draw partners into the business mix that could provide elements that may have been missing in a particular venture—and to drive repeat visitation into the retail stores that were part of the mix.

Again, as in retail mall development, UECs also featured at least one anchor tenant to encourage initial and repeat visitation. Cineplexes (and megaplexes) were the most common anchor. The reason for this was simple: With the vast machinery of Hollywood turning out new "software" (movies) every week, a cinema provided the best vehicle for repeat visitation. Clustered together, the right combination of what may have previously been stand-alone venues attracted a greater number of visitors than each might have been able to draw on its own.

The end result of this combination of venues was a mega-destination of interest not only to the local community, but to tourists as well, increasing the geographic draw far beyond the typical 30-minute drive time most stand-alone entertainment centers used as an outside boundary. Additional benefits of clustering included an increased length of stay, extended appeal into dayparts that may not have been particularly strong for a stand-alone, and the ability to find better uses for under-performing space.

Some of these developments did well, mostly those that focused primarily on eating and seeing a movie, such as CocoWalk, in Coconut Grove, Florida. With a 16-screen multiplex theater and restaurants ranging from the Baja Beach Club, to Fat Tuesday, to Howl at the Moon Saloon, plus 28 retail shops, CocoWalk offers South Florida residents a destination that is a natural for repeat visitation and increased length of stay. The atmosphere of this center on a normal night is that of one big festive party; on any night that focuses on a major sporting event, such as the Super Bowl, it is beyond description. People have fun there.

Another example of a relatively successful UEC is CityWalk, located at Universal Studios in Burbank and Orlando. CityWalk is a destination attraction that includes a variety of full sit-down restaurants, live music venues, retail shopping—although mostly of the something-to-remember-the-trip-by variety—and a multiplex.

CityWalk, however, is different from other UECs as it helps to draw people to its partner, Universal Studios theme park—and that difference, and the success of the CityWalk effort, captured the attention of entertainment brands not traditionally known for having local entertainment destinations. One of these brands—Sony—realized that it could strengthen its brand image by creating a destination that not only offered a high-gear entertainment experience, but also tied its products to that experience, cementing Sony as the entertainment brand of choice in the guest's mind.

Case in Point: Sony Metreon

Sony Metreon, located in San Francisco, is an urban entertainment destination that was informed by CityWalk and the success of the Sony theater across from Lincoln Center in New York City. Lincoln Center itself is an entertainment destination, with the Metropolitan Opera, the New York Philharmonic, the New York City Ballet, several movie screens, and a variety of upscale shopping and dining experiences, all within a few square blocks. Businesses in the area feed off one another's synergy in much the same way a mall would, with the exception being that the desired product—or experience—is entertainment. Sony Development looked at the traffic in the area while considering a new approach in the development of a Sony theater-based project in a still-pioneering area of San Francisco.

Additionally, the Sony Wonder installation in New York (where visitors could have a hands-on experience of editing video and music, among other attractions), featuring Sony equipment, had proven to be a significant tourist draw. The same was true for a similar installation in Chicago; most important, neither of these destinations actually sold Sony products. Instead, they acted as a brand-driven experience that afforded guests the opportunity to taste new technology.

The Metreon project came off the drawing board as a destination that would not only drive per-visit revenue, but would also strengthen Sony's image as the leading developer of new entertainment technology. To increase the chances of success for this second goal, Sony Development focused on a different approach. While other retail-oriented destinations were using a recipe that called for movie screens, dining, and retail, Sony included the movies, but chose to underscore the entertainment component by including a unique blend of other attractions—a strategy that also keyed in on the company's desire to reach a multitude of age groups.

Instead of the typical retail stores seen in most urban entertainment destinations, Sony included the following:

  • For families and younger children, a children's entertainment attraction based on Maurice Sendak's classic Where the Wild Things Are allows visitors to actually live the experience of the book, taking guests through a series of games and experiences that closely follow the story line. One of the critical factors in developing children's entertainment is creating an attraction that will drive repeat visitation—bringing the family and their dollars back to the site more than once every few years. Basing this attraction on a story that children can easily ask for on a nightly basis allows for continued visitation—and keeps boredom at bay.

  • For the 18- to 34-year-old market, Airtight Garage offers a surreal setting where the works of Jean "Moebius" Giraud have inspired interactive games that are unique to Metreon, including HyperBowl™, which allows guest to "bowl" down the streets of San Francisco, through the trees of Yosemite, or across the deck of a rocking pirate ship.

  • The dining component—critical in driving repeatability and length of stay in experience-driven entertainment destinations—offers a wide variety of choices, including the Night Kitchen (again inspired by Sendak) and A Taste of San Francisco (five popular Bay Area restaurants).

Metreon, however, is also designed as an experiential branding destination, and Sony has taken a full swing at exposing guests to their new technologies. The retail component includes:

  • Sony Style, which allows visitors to investigate Sony electronics in a no-pressure living room environment, from TVs and handy hams to audio at Music 101™ .

  • PlayStation™, a hands-on game store, offering old titles and expert tips.

Additional experience-driven retail includes:

  • Discovery Channel Store: Destination San Francisco™, an interactive and educational store.

  • Digital Solutions, a technology store that offers the latest in computer games and computer hardware, as well as digital audio equipment and portable devices. Portal One™, which offers gaming accessories, anime, and urban gear.

Metreon inhabits a 350,000 square foot space and cost $230 million. The center received 1,000 visitors in its first five days. The challenge will be to keep attendance up, as many destination attractions suffer from a drop-off once the novelty factor wears off. However, the variety of experiences offered seems to be a good mix for supporting this branding effort.

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