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When Universal Studios broke ground on a Beijing theme park in 2016, it revealed seven themed zones comprising the 1,000-acre property. From “picking up fighting techniques” at the Kung Fu Panda Land of Awesomeness to “following in Harry’s footsteps” at The Wizarding World of Harry Potter, Universal promised to deliver experiences from the world’s most beloved movie franchises to Chinese audiences. Intellectual property (IP), it seemed, was not something the American entertainment giant was lacking.

Less than six months before the $3.3 billion project was set to welcome visitors, however, Universal announced a long-term licensing partnership with Tencent Interactive Entertainment Group, the gaming department of the Chinese technology giant. 

Initially, at least, the deal centers on seasonal events with Tencent promising to integrate IP from popular titles including Honor of Kings, Peacekeeper Elite, and QQ Speed across digital interactions, stage performances, and themed retail opportunities. The agreement not only evidences mutual ambition between Universal Studios and Tencent, but more broadly, the emerging offline presence of e-sports and gaming in China’s entertainment and travel sectors.

Here’s the context and significance behind the agreement between China’s biggest game publisher and one of the world’s largest theme park operators.

The context

Driven by rising leisure spending, China’s theme park industry is in the midst of a boom with an average of 35 theme parks opening per year since 2014. In 2019, the sector neared $50 billion in revenue and though domestic companies such as OCT Group currently prop up such figures, international players, including Six Flags and Legoland, have announced Mainland projects. The hope is to emulate the success of Disneyland Shanghai which received 11.2 million visitors in 2019.

The success of attractions like Chimelong Ocean Kingdom and Shanghai Disneyland has driven a theme park building boom in China that’s averaged 35 openings per year since 2014. Image: Daxue Consulting

At the same time, with more than 700 million gamers spending an estimated $40 billion last year, China’s gaming industry is unrivaled in size and revenue generation. The sector is increasingly capitalizing on its popularity by moving into offline opportunities. This includes crossover products — cosmetic brand M.A.C., for instance, created lipsticks alongside King of Glory — and developing large offline e-sports venues that offer a range of entertainment opportunities.  

Beyond China, Universal is already planning to integrate gaming IP into its theme parks in Japan, Singapore, Florida, and California through an agreement with Nintendo. 

Why it matters

The status of gaming IP The presence of gaming IP at Beijing’s most high-profile theme park shows that the status and brand power of popular games is approaching that of other major entertainment IPs. “Collaborations, such as this one with Universal, allow game companies to increase the number of opportunities for fans to experience and engage with said IP,” says Lisa Hanson, Founder of Niko Partners, a market research firm.

Building offline culture From Tencent’s perspective, partnering with Universal Studios Beijing is part of a broader offline strategy. “They believe gaming has transcended mainstream sports,” says Tom Elsden, Business Director at Mailman Group. “They believe it can be greater than just watching or playing — a lifestyle for many in China — and are pushing for gaming to be closely entwined with local culture.”

Making room for e-sports — While Tencent and Universal offered few specifics on the nature of their “seasonal events,” Daniel Ahmad, Senior Analyst at Niko Partners, predicts special onsite offerings and e-sports events to feature prominently. “We expect new interactive experiences and ones that provide in game benefits too — a mashup of game IP and Universal IP. We also expect competitive esports events by both professionals and amateurs.”

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What Universal and Tencent say

“We are committed to creating innovative theme park experiences for more Chinese guests and supporting the high-quality development of China’s cultural tourism industry. By introducing popular, high-quality Chinese IP… we will continue to bring incredible guest experience[s] that keep pace with the times.” — Tom Mehrmann, President and General Manager, Universal Studios Beijing Park and Resort

“We believe that this collaboration can create emotion that extends from online to offline, and a richer and more immersive customer experience… The innovative cooperation between the two parties will… allow for the exploration of more possibilities from ‘digital IP + cultural tourism’ perspective!” — Ma Xiaoyi, Senior Vice President, Tencent

Categories

Cultural Collaborations, Destinations, IP Partnerships