Cultural industry entering cool down period

Over the past few years big real estate companies have been throwing money into the cultural industry, what they see as China's newest sun-rise industry and the savior of their own industry. However, things just aren't that simple anymore.

Leading domestic commercial property developer Wanda Group's unexpected declaration earlier this month that Spiral Show, the tourism performance in Sanya, Hainan Province, it had invested so heavily in, would be coming to an end acted as a stern wake up call for those companies preparing to enter or that have already entered into an industry that is completely unfamiliar to them.

Showing off

With an investment of 60 million yuan ($9.75 million), Spiral Show premiered in September 2011 to a grandiose opening. Not only did the President of Wanda - Wang Jianlin, one of the richest men in China - attend the premiere, but also top local political figures such as Luo Baoming, secretary of the Hainan provincial committee of the CPC, and Jiang Dingzhi, then acting governor of Hainan Province.

One of the first major real estate companies to enter the cultural industry, Wanda invested enormous time, money and effort into its first stage production. Including 11 original musical works and combining various elements such as acrobatics, music and high-tech special effects Spiral Show told the tale of an ancient local love story. Wanda even invited world-class music producers such as the Emmy Award winning Gale Edwards and Tony Award alumnus Robert Tannion.

However, despite such an experienced team and strong support from the local government, Spiral Show now faces the awkward situation of coming to a premature end. This is not the first time the show has experienced trouble. Since it premiered three years ago, four general managers have tried one after another to save the show but failed to turn things around. In 2013, the show received a special cultural fund from the Sanya government, but even this proved futile.

A lesson to be learned

Wanda was not wrong in choosing Sanya, one of the country's hottest tourist spots, as the test bed for its stage production. According to studies conducted by online tourist destination reservation websites tuniu.com, lvmama.com and qunar.com, Sanya holds a secure place among the top three domestic vacation spots.

Figures from the Hainan Provincial Bureau of Statistics also show that in the first half of this year, the total amount of tourists in the region have increased 11.2 percent year on year, while total tourism revenue rose 14.3 percent. Meanwhile, the increasing number of tourists that travel to the island show a willingness to spend more than 5,000 yuan ($800) on high-end recreational activates such as Wanda's super show.

A great location though, doesn't automatically mean success. Wanda's biggest mistake came about due to its lack of understanding about super shows, especially those produced for tourists. Looking to achieve the same success as shows in Las Vegas, Wanda made the assumption that a popular tourist spot equals a potential audience for its high-end performance. But in reality, successful tourism performances actually consider various complex factors such as the presence of high-end consumers who not only have money to spend, but are also interested in artistic performances, supportive facilities such as transportation and hotels, whether the overall atmosphere lends itself to a culturally-themed performance and ensuring that a performance isn't all flash but also has a story that can connect with audiences.