Blog's home page Subscribe to Randy's blog

Be an LBE disrupter before you get disrupted

Often, when I give presentations or discuss the trends we are seeing with the shrinking market for community location-based entertainment venues, I often hear a response along these lines, “But people will always go out for entertainment.” Well, that is not totally true. Our company’s research finds a long-term trend of a declining percentage of people going out, and for those who still do, many visit out-of-home entertainment venues less often.

What we are seeing today for just about every type of consumer business is business-model disruption. When it comes to location-based entertainment venues (LBE), it’s not so much about disruption from other LBE competition (although that is happening some), but rather much more about disruption from the fast-evolving innovation occurring with the Triple Revolution – the Internet, social media and smartphones.

Consumer digital technology is dramatically changing consumers’ behaviors and expectations and taking away LBEs’ market share of both consumers’ leisure time and discretionary spending. At-home and mobile digital technology options are rapidly expanding in availability, selection and quality while declining in price. Average household expenditures on all types of consumers’ at-home and mobile digital technology (equipment, downloads and subscriptions) increased by almost 1/3 (+31%) from 2004 to 2013 while average household expenditures on fees and admission for entertainment and the arts decreased by over 1/4 (-27%) over the same ten years. The average dollar increase to household spending on digital technology over the ten years was more than three times greater than the total amount that the average household spent on for fees and admissions in 2013.

During those same ten years, there was a more than 1/3 (-38%) decrease in the number of people attending entertainment and arts venues on any given day while time spent on digital devices of all types has skyrocketed. Just over the past three years, the average amount of time adult Americans spend on their mobile devices is up 75% and total digital time is up daily by one-half hour. And research shows that time on digital devices is displacing leisure time spent at real world locations.

Time spent on digital leisure '12-'14 copy

LBEs are fast being disrupted by the siren call of the digital world, including all of its forms of entertainment and social media, which most users consider as a form of entertainment.

To counter digital Darwinism and avoid the innovator’s dilemma, LBEs need to disrupt their current business models. This disruption requires a paradigm shift from thinking that LBEs are entertainment destinations to re-conceptualizing them as great, upscale, social destinations targeting adults rather than everyone in the family. Great contemporary food and beverage becomes a major attraction and the entertainment shifts to a less prominent role.

Location-based entertainment no longer has the draw it did just a few years ago, as now entertainment alternatives are conveniently available in the digital world 24/7, not matter where you are and at low or no cost. The LBE formulas of just a few years past are no longer future proof. Be a disrupter before you get disrupted, because that disruption is already underway.

To learn more about the long-term trends affection LBEs, check out our company’s white paper, The Perfect Storm: LBE Disruption & Opportunity.

About Randy White

Randy White is CEO and co-founder of the White Hutchinson Leisure & Learning Group. The 30-year-old company, with offices in Kansas City, Missouri , has worked for over 550 clients in 36 countries in North and Latin America, Africa, Asia, Europe and the Middle East. Projects the company has produced have won seventeen 1st place awards. Randy is considered to be one of the world’s foremost authorities on feasibility, brand development, design and production of experience destinations including entertainment, eatertainment, edutainment, agritainment, play and leisure facilities. Randy was featured on the Food Network’s Unwrapped television show as an eatertainment expert, quoted as an entertainment/edutainment center expert in the Wall Street Journal, USA Today, New York Times and Time magazine and received recognition for family-friendly designs by Pizza Today magazine. One of the company’s projects was featured as an example of an edutainment project in the book The Experience Economy. Numerous national newspapers have interviewed him as an expert on shopping center and mall entertainment and retail-tainment. Randy is a graduate of New York University. Prior to repositioning the company in 1989 to work exclusively in the leisure and learning industry, White Hutchinson was active in the retail/commercial real estate industry as a real estate consultancy specializing in workouts/turnarounds of commercial projects. In the late 1960s to early 1980s, Randy managed a diversified real estate development company that developed, owned and managed over 2.0 million square feet of shopping centers and mixed-use projects and 2,000 acres of residential subdivisions. Randy has held the designations of CSM (Certified Shopping Center Manager) and Certified Retail Property Executive (CRX) from the International Council of Shopping Centers (ICSC). He has authored over 100 articles that have been published in leading entertainment/leisure and early childhood education industry magazines and journals and has been a featured speaker at conventions of over 20 different leisure trade groups. Randy is the editor of his company's Leisure eNewsletter, has a blog and posts on Twitter - https://twitter.com/whitehutchinson
This entry was posted in digital, Disruption, Entertainment, feasibility, FEC, Leisure time, Location based entertainment, Out-of-home, Trends and tagged , , , , , , , , , , , . Bookmark the permalink.