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Saturday, June 27, 2009

Mexican entrepreneur wants to turn KidZania into global brand

A model of Kidzania. Xavier Lopez Ancona (inset) says from his planning of a day-care centre, the theme park turns out to be something even more fun and bigger that could attract an even larger crowd

CHILDREN’s role-playing is a universal concept that has existed for thousands of years. Identifying this as a business opportunity, Mexican entrepreneur Xavier Lopez Ancona founded the KidZania theme park in 1999.

The president on KidZania International told StarBizWeek that the idea for KidZania started 12 years ago when his childhood friend approached him to start a business in day-care centre that would offer a variety of activities that could attract children.

Ancona was then a very successful executive in the equity capital group department of the multinational technology and services conglomerate, General Electric. But he tried to help his friend anyway.

During those two years, Ancona spent his after-hours and weekends helping his friend to draw up a business plan for the day-care centre.

“From planning for a day-care centre, it turned out to be something even more fun and bigger that could attract an even larger crowd,” Ancona says.

So, the first KidZania theme park was opened in Mexico City in 1999. It was an instant hit, and Ancona has never turned back. There are currently two KidZania theme parks in Mexico, including one in Mexico City that attracts an average of 800,000 visitors annually. A third is currently under construction. The concept has also been licensed and franchised to operators in Tokyo and Osaka in Japan; Jakarta, Indonesia; and Lisbon, Portugal.

Healthy activities

KidZania is a “nation” just for children. Targeting those between two and 12, it is an educational and entertainment centre that allows children to role-play adult activities in a replica city designed to imitate real-life and a functioning economy.

What’s even more interesting is that this “nation” has an official currency called kidZos. Children can earn kidZos by working in KidZania, and they can use the currency to pay for the goods and services there. They can also save their money and earn interest from their savings in the “banks” in KidZania.

Ancona believes that parents would like the concept of KidZania, as the programmes in the theme park have been designed to instil positive values in children.

The experience in KidZania is aimed at helping children learn faster about the adult world and how a real city works.

The programmes also help children to develop a sense of vocation as they get to try out the various occupations available at KidZania.

KidZania offers more than 60 professional roles, including pilot, doctor, teacher and journalist, for children to play. But given the limited time of five hours per entry, a child can usually play between five and 10 roles a day. Hence, there is a repeat factor for the children to come to the city again to try out other roles.

According to Ancona, the programmes at KidZania are changed regularly so that there is always something new for the children to experience each time they visit the theme park.

It also has a loyalty programme, whereby children can apply for “citizenship” and be KidZanians. As citizens of KidZania, the children will get a “passport” and enjoy various benefits such as income tax incentives.

Ancona believes that the experience in KidZania would also help children learn about the value of money, and how they have to work hard to earn a living, as well as the importance and benefits of savings.

He says children would also be able to pick up social skills through their interaction with other children in the theme park and learn to make their own decisions.

Ancona reveals that the bulk of the people working in KidZania are mainly the supervisors who have to monitor and guide the children.

“It requires special skills to be a supervisor at KidZania, and we take a long time to select the right people for the job,” he says.

Among the values that he looks in people applying to be a supervisor at KidZania are patience, service orientation and passion for children.

Generally, the KidZania theme park is targeted mainly at the local market, with an ideal composition of 70% local residents and 30% outstation or foreigners.

KidZania’s business has remained fairly resilient through the current economic challenges, owing to the fact that it focuses on the local market, Ancona says.

In recession, most people tend to turn to nearby locations for leisure and entertainment, as they cut down on travelling, he explains.

In addition, the entrance fees for KidZania theme parks are quite affordable, though they vary by countries.

However, Ancona acknowledges that the recent outbreak of the A (H1N1) influenza virus had a negative impact on KidZania’s business in Mexico when the theme parks there had to be closed temporarily.

Nevertheless, it is back to business as usual now in Mexico, he says.

Global brand

KidZania brand is growing fast internationally. He, however, did not reveal how much the business is worth today.

This year will also see the opening of KidZania theme parks in Dubai, the United Arab Emirates, and Seoul, South Korea.

Over the next two years, KidZania theme parks will be opened in Cuicuilco, Mexico; Shanghai, China; Bangkok, Thailand; Santiago, Chile; Istanbul, Turkey; and either Delhi or Mumbai in India. Malaysia will also have a KidZania theme park by 2012.

Most of these expansions have been through franchise programmes.

Ancona explains, “We want to partner the local organisations because they understand the local market better than us.”

As for the ticket pricing structures, Ancona reveals that they are usually determined by KidZania’s franchisees.

“We only make proposals based on the socio-economic levels of the local markets of our franchisees, but the decisions are ultimately in the hands of our local partners,” he explained.

Meanwhile, there is also a plan to open KidZania in the US after the next two years.

“The US is the biggest market in the world for any type of entertainment but it is also a very tough market. You only have one chance to do it right,” Ancona explains, adding that he wants to make KidZania a global brand first before setting its foot in the United States.

By The Star (by Cecilia Kok)

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