Fosun Group has been involved in Cirque du Soleil for two years. How can Cirque du Soleil break the Chinese market?

strong > acquisition / strong >

since entering the entertainment industry, Fosun Group has never stopped its pace of acquisition. In the performance industry, Fosun acquired an entertainment company and performance group Cirque du Soleil in Canada with TPG Capital as early as 2015. Cirque du Soleil will remain independent after the acquisition is completed, according to details of the deal announced by the two sides in June 2015. In terms of shareholding ratio, Fosun will own 25 per cent of Cirque du Soleil and TPG Capital 55 per cent.

Public data show that Cirque du Soleil was founded in 1984. Contrary to traditional circus performances, Cirque du Soleil is good at combining various thrilling technical performances with gorgeous stage dance devices, and using performances to tell dramatic stories. As early as 2007, Cirque du Soleil held its first performance in the mainland in Shanghai. So far, Cirque du Soleil has performed for 160 million audiences in more than 400 cities in 60 countries.

for Fosun Group, this investment in Cirque du Soleil is another strategic move in the happy fashion sector after Club Med Bali, Thomas Cook and other investments. To facilitate the deal with Cirque du Soleil, TPG Capital and Fosun have also made a number of commitments, including ensuring that Cirque du Soleil's headquarters and creative control will remain in Montreal, ensuring the growth of Cirque du Soleil's business, and expanding job development and training opportunities for employees in Quebec and Canada.

after the completion of the acquisition, Fosun Group also continues to expand the business layout of Cirque du Soleil in China. Cirque du Soleil's first Chinese resident show was established in Hangzhou in 2015 and officially opened in 2018. It is expected to perform 450 shows a year, grossing 500000 people at the box office. In addition, Cirque du Soleil has also set up its office in Shanghai. Fosun Group also said it would coordinate its brand resources such as Club Med Bali with Cirque du Soleil, such as creating a themed amusement park.

strong > the dilemma to be broken / strong >

in the past few years, the domestic performance market has shown a good growth trend. Cirque du Soleil's introduction of the strategic investment of Fosun Group is also to expand the business layout in the domestic market. Daniel Lamar, CEO of Cirque du Soleil, has said many times in public that China is the future of Cirque du Soleil's development strategy. Cirque du Soleil will look for more opportunities for resident shows in China, and these resident shows will also integrate more Chinese elements.

"from the point of view of the market, the development of Cirque du Soleil in China is not optimistic, and Cirque du Soleil is not well-known in China. These factors will increase the difficulty of promoting Cirque du Soleil." Chen Shaofeng, deputy dean of the Institute of Cultural Industry at Peking University, said, "in addition, although Cirque du Soleil's programs are very popular abroad, there are great differences between domestic and foreign audiences in terms of consumption habits, customs and culture." and Cirque du Soleil's ticket prices are also relatively high, which will deter many consumer groups. "

it must be mentioned that Cirque du Soleil came to Macau as early as 2008, setting up ZAIA, the first resident play in Asia, in Macau, and signed a 10-year cooperation agreement with Sands China Co., Ltd. However, "ZAIA" was not favored by Macao audiences, and the ticket price of 388-1288 patacas also made the attendance of the theatre not high. Three years later, Cirque du Soleil withdrew sadly from the Macao market. In terms of repertoire, Cirque du Soleil's repertoire is mainly self-created, and the production cost of each play is also quite high. Public sources show that the production cost of the "Card" show is as high as 165 million US dollars, while the production cost of the "Iris" show is also close to 100 million US dollars. Daniel Lamar has said that the team of the resident show will bring in Chinese actors and artists, which means that the cost of the play will be further increased. While Cirque du Soleil's current revenue is still dominated by box office revenue, how to expand the diversified profit model is also a difficult problem for Cirque du Soleil.

strong > adjust measures to local conditions / strong >

as an investment group, Fosun Group's investment territory has been extended to tourism, real estate, entertainment and other fields. After the strategic stake in Cirque du Soleil, the two sides can cooperate in many fields in addition to circus performances, and Fosun Group will also use its own commercial resources to maximize the value of Cirque du Soleil, such as integrating Cirque du Soleil into its tourism and vacation industry.

data show that Fosun Group will help Cirque du Soleil set up a company in China and introduce talents who are good at industrial operation. On the one hand, it provides services for Cirque du Soleil, and on the other hand, it helps Cirque du Soleil and Fosun Group realize the docking of different industries. In terms of profit model, Cirque du Soleil is also looking for more diversified models, such as opening up new sources of revenue, including licensing, digital media and ticket sales.

"in addition, Cirque du Soleil also needs more adjustments in terms of performance content and ticket prices, so as to meet the needs and consumption habits of domestic audiences; in terms of market positioning, as first-tier cities such as Shanghai have a high degree of acceptance of large-scale foreign performances, Cirque du Soleil also needs to increase marketing efforts to attract the consumption of these audience groups." Chen Shaofeng stressed that with the advent of the information age, the Internet and smartphones have become more and more popular. with the help of Internet channels, user traffic and other advantages, it can not only bring enough attention to Cirque du Soleil, but also open up market opportunities.

Edit: yvonne