Geospatial Analytics Makes for Safer Bets in Casino Equities

We recently launched our self-service geospatial platform, Orbital Insight GO, in our mission to understand what is happening on and to the Earth. Subscribers have access to vast quantities of geospatial data, including multiple imaging satellite constellations and hundreds of millions of connected devices. The GO platform then contextualizes raw geospatial datasets to create analytics at scale using artificial intelligence and machine learning.

Looking at Macau Casinos

In an example use case, GO observed foot traffic at 9 Macau Casinos using geolocation (mobile device) data to understand trends in customer visitation. Foot traffic is an important indicator of casino revenues when combined with betting size information and win rates. GO can benchmark against traffic patterns against competing assets on the Cotai Strip, and help users gain a deeper understanding of customer traffic and market share.

Today investors focus heavily on the Macau Gross Gaming Revenue numbers published by The Gaming Inspection and Coordination Bureau (DCIJ). While this is useful intra-quarter data, it doesn’t provide granularity on specific casinos and is released only monthly.

Creating a GO Project

A GO user can recreate this project using our platform and API functionality with a few simple steps.

Orbital Insight GO empowers users to access multiple sources of geospatial intelligence and rapidly extract insights.

1. Select an Algorithm: From our list of proprietary algorithms (including cars, ships, land use, IoT devices, etc) we chose geolocation for this project. When normalized, it provides a highly accurate signal for localized foot traffic.
2. Specify an Area of Interest: Users are able to draw or upload their areas of interest (AOIs) directly in the platform to select where they would like to monitor, ranging from hyperlocal to global scale geographies. In this case we drew the property boundaries for Galaxy Macau, LVS Venetian Macau, Wynn Palace, LVS Cotai Central, Melco City of Dreams, LVS Parisian Macau, Melco Studio City, LVS Plaza Macau, and MGM Cotai.
3. Identify a Time Period: Monitor historical, current, and ongoing change in your project. To understand change in market share across the 9 casinos we looked at foot traffic from 2017 to 2019.

GO’s Analysis: Customer Visitation

After specifying the project’s criteria, Orbital Insight GO ingests, interprets, and analyzes the geospatial datasets within hours — whether you’re looking at a single store or an entire county.

For our Macau Casino exploration, GO delivers a normalized traffic pattern which can be plotted for each casino. An analysis of the data shows that traffic was slow on MGM Cotai’s opening night of February 13, 2018, but soared through the Chinese New Year weekend (February 15–17) before returning to a baseline pattern of traffic later in the month.

After a lackluster opening, MGM Cotai traffic surged a few days later during the Chinese New Year weekend.

Market Share Analysis

By continuously aggregating traffic and analyzing the proportion of foot traffic to each casino property, GO lets customers understand trends in market share between the various casinos on the Cotai Strip.

Orbital Insight GO creates advanced consumer analytics at scale, including daily market share tracking.

Who Was Impacted the Most by the MGM Cotai Opening?

GO’s ability to zoom in from long term trends and identify anomalous patterns is crucial for understanding company market share and relevant in customer loyalty and defection rates.

By focusing on January to March 2018, the foot traffic data reveals the MGM gained approximately 5% of market share after opening. This occurred at the expense of MGM Cotai’s closest neighbors: the Las Vegas Sands properties including Cotai Central, the Venetian and Plaza losing about 1–2% points of market share each.

MGM Cotai gains market share at the expense of neighboring Las Vegas Sands casinos.

Safer Bets with Geospatial

International casino operators make up over $100 Billion in market capitalization, with Macau properties comprising of a majority of their earnings. A GO user can quickly ask a question regarding their portfolio to generate novel insights and reduce risk with real-time actionable information.

While this use case focused on foot traffic in Macau’s Cotai Strip, Orbital Insight GO is designed to rapidly answer a versatile set of questions on a global scale: How much oil is stored in China? How far do customers travel to a real estate asset? How many houses are going up in Houston? Is there risk within my supply chain?