North America Location-based Entertainment Market (2024 - 2030)

Market Size & Trends

The North America location-based entertainment market size was estimated at USD 1.43 billion in 2023 and is expected to grow at a CAGR of 26.5% from 2024 to 2030. The growing disposable income, technological advancements in arcade gaming, urbanization, and growth in tourism are increasing the demand for location-based entertainment in the region. The proliferation of smartphones and mobile technology enabled the gamification of real-world experiences, driving engagement and participation in location-based entertainment (LBE) activities. Many LBE venues leverage mobile apps and location-based services to enhance the visitor experience, offering interactive challenges, rewards, and personalized recommendations.

Virtual reality (VR) and augmented reality (AR) technology companies are creating immersive and interactive experiences that are attracting consumers to LBEs. These technologies offer a level of engagement that traditional entertainment options cannot match. North America is a popular tourist destination, and amusement parks are major attractions; the amusement park companies keep investing in new rides and shows and creating magical experiences for visitors.

Market Concentration & Characteristics

The industry is fragmented in nature, the industry growth stage is high, and the pace of the market growth is accelerating. The industry's degree of innovation is also high, and many LBE venues are integrating cutting-edge technology to enhance the guest experience. It includes using VR and augmented reality (AR), interactive digital installations, and app-based interactions that enhance the user experience. LBE companies invest heavily in new product development to remain competitive in the industry.

The impact of regulations is also high in the industry; LBE companies take extra precautions for customer safety, making rides safer for children. They also follow strict hygiene norms. The end-use concentration is moderate as the LBEs cater to a diverse audience, ranging from families seeking fun and educational outings to young adults looking for immersive and social experiences and tourists exploring iconic attractions. It also serves corporate groups for team-building events, schools for educational trips, gamers drawn to high-tech experiences, and individuals planning private events or celebrations.

Component Insights

Based on components, the hardware segment held the largest market share of 64.0% in 2023. The increase in demand for immersive technologies is driving the segment growth. AR, VR, and haptics are at the forefront of LBE innovation. As LBE aims to become more realistic, the need for improved, innovative, and immersive hardware technology has increased. The hardware includes modular components swappable in VR headsets, allowing operators to create diverse experiences within a single space.

The software segment is expected to grow at the fastest CAGR during the forecast period. The increase in cloud-based solutions is expected to drive the segment growth. Cloud computing offers scalability and is cost-effective for LBEs, and with the help of cloud-based solutions and advancements in artificial intelligence (AI), new personalization innovations are possible. The growing popularity of VR arcade zones across countries relies on software to create engaging games and immersive experiences for users.

Technology Insights

Based on technology, the 3-Dimensional (3D) segment held the largest market share in 2023. The increasing need for immersive entertainment content is driving the segment's growth. 3D rides, horror escape rooms, and live 3D shows at LBEs provide an engaging experience for users. The growing need for immersive hardware like VR headsets also accounted for the increasing growth of the 3D segment.

The cloud merged reality segment is expected to grow at the fastest CAGR over the forecast period. CMR leverages cloud processing power, eliminating the need for expensive on-site hardware and reducing the cost, which makes it easier for applications at LBEs with smaller venues. CMR offers enhanced experiences through haptic feedback on wearables and suits, which upscales the user experience. The growing advancements in AI recognition, AR, and VR are expected to contribute significantly to the growth of cloud-merged reality.

End-use Insights

The amusement park segment held the largest revenue share in 2023. Universal Studios, SeaWorld, Legoland, Cedar Fair, and Six Flags drive the market. Amusement parks are major tourist attractions and places for customers to interact socially. These parks provide engaging experiences with exciting rides, theme parades, fireworks shows, and musical concerts as forms of entertainment. Amusement parks across the region collaborate with movies to create theme-based content for users.

Arcade Studios are anticipated to grow at the fastest CAGR over the forecast period. The increasing demand for evolving game concepts, hardware integration, and location-based Esports drive the market. The demand for these arcade studios is expected to grow significantly as millennials and Genz are fond of retro and classic arcade games and with the integration of newer technologies such as virtual reality.

Country Insights

U.S. Location-based Entertainment Market Trends

The U.S. accounted for nearly 25% of the revenue share of the global location-based entertainment market in 2023. Growing disposable incomes, technological advancements, and increased tourism are key drivers for the LBEs market growth in the U.S. The country's amusement parks have become tourist spots that are constantly evolving and upgrading to attract more customers. Iconic parks like Universal Studios, SeaWorld, and Legoland welcome millions of customers throughout the year, providing memorable experiences.

Mexico Location-based Entertainment Market Trends

Mexico is expected to grow at the fastest CAGR over the forecast period. The increasing urbanization with the growing concentration of young people in major cities and rising disposable incomes among citizens are expected to drive the LBE market in the country. Increasing theme parks in the country are also expected to contribute to market growth. In June 2023, Hasbro announced the inauguration of Hasbro City. Hasbro City is a themed entertainment center based on the Monopoly game, Transformers, Power Rangers, and others. They offer rides like suspended roller coasters and virtual reality spaces for fans to interact.

Key North America Location-based Entertainment Company Insights

Barron Games International, Bob’s Space Racers, Cinepolis, Six Flags Entertainment Corporation, etc. are some of the key players in the market. Barron Games International designs, manufactures, and distributes high-quality arcade and amusement games globally. Their product range includes air hockey tables, redemption games, interactive sports games, kiddie rides, and virtual/augmented reality experiences. They also offer custom game development services. Barron Games serves various location-based entertainment venues such as family entertainment centers, amusement parks, bowling alleys, shopping malls, casinos, and standalone arcades, providing innovative and engaging gaming solutions to enhance customer experiences.

Six Flags Entertainment Corporation operates a vast network of regional theme parks and water parks across North America. The company manages numerous parks known for their exciting roller coasters, family rides, water attractions, live entertainment, and themed events. Notable parks include Six Flags Magic Mountain, Six Flags Great Adventure, and the Hurricane Harbor water parks. Six Flags provides a wide range of experiences, from thrilling rides to family-friendly activities, and hosts seasonal events such as Fright Fest and Holiday in the Park, offering year-round entertainment and engagement for visitors of all ages.

Recent Developments

• In January 2024, Sony Entertainment announced the launch of Wonderverse, an entertainment destination based on famous television series, movies, and games. The entertainment zone features immersive experiences, interactive games, theme-based restaurants, and other attractions. The company aims to offer customers immersive experiences from their favorite movies and stories.

• In January 2024, Cineplex announced the launch of Playdium in Toronto. The gaming zone will feature state-of-the-art games such as mini golf, a bowling zone, and other interactive games. It will have interactive high-tech games catering to kids of all ages and skill levels.

• In July 2023, iSwii by Angry Birds opened a new Angry Birds-themed café in the U.S. The café has Angry Birds-themed merchandise and interactive VR games for people to enjoy with friends and family.

• In May 2023, Six Flags Fiesta Texas partnered with IGN Entertainment to launch the ESIX gaming arena. The arena features gaming console stations, a VIP lounge, a theatre, and a customer bar. The company aims to provide the local gaming community with state-of-the-art games and a competitive gaming experience.

• In March 2023, Merlin Entertainments entered into a partnership with Hasbro to construct a new theme park based on the famous children's cartoon character Peppa Pig; the park features multiple rides, interactive attractions, and playscapes based on the cartoon character.

North America Location-based Entertainment Market