Investigating the Premium Market in Macau Casinos: Regulation, Practice, and Challenges

This study investigates the regulatory-operational dynamics of the premium market in Macau casinos using a constructivist grounded theory approach. Qualitative in-depth interviews were conducted with 25 participants from three stakeholder groups. The grounded theory analysis identifies seven core categories illustrating the impact of the new regulatory system on the premium direct and premium mass segments in casinos. These categories include regulatory changes and operational challenges, decline of gaming promoters, premiumization of the gaming market, new player retention strategies, cross-border player acquisition risks, presence of unauthorized agents in casinos, and non-gaming development amid international competition. These insights highlight four major regulatory impacts on the industry themes and operational trends, i.e., industry regularization, market premiumization, product diversification, and criminal fragmentation. This study also identifies specific regulatory mechanisms and operational management in premium gaming, such as premium player identification, enhanced operational procedures, multi-tiered market segmentation, and the provision of personalized services. Additionally, stakeholder perceptions of the new gaming regulatory system are explored, with casino and expert groups considering it necessary and junket participants finding it restrictive. From these findings, a conceptual model structured around regulatory functions, compliance, and improvement is developed to provide a theoretical regulatory framework that aligns with the characteristics of the gaming industry in Macau and possibly other gaming jurisdictions.