FRESH TAKES ON BIG IDEAS

Brands and intellectual property (IP) owners are looking to meet consumers where they are—literally. Location-based entertainment has long been a powerful way to bring characters, stories, and products to life. As an audience development tactic, it deserves heightened consideration in an era when consumers increasingly value experiences over things.

Traditionally, location-based entertainment—which can include rides, experiences, and other in-person attractions—has often been associated with major theme parks, multimillion-dollar investments, and long-term commitments only suitable for larger players. But more modest and flexible options are emerging: Smaller-scale, regional, seasonal, and pop-up experiences can bring brands and IP into the real world without incurring as many risks and costs as a full-blown attraction might. Paired with licensing, this can create increased flexibility for both IP owners and location operators.

Fit-for-purpose experiences can lower the barriers to entry. They generally require less capital, can launch and replicate faster, and are easier to move on from if conditions change. They can also make location-based entertainment more accessible for consumers who might not have the time or money to travel to a destination theme park but would be eager to visit a less expensive experience closer to home.

These less expansive experience formats often don’t deliver margins on par with those of major theme parks (though the range of EBITDA performance from location-based entertainment venues can vary widely). But focusing solely on profit misses the bigger picture. Smaller-scale attractions can still create meaningful value by driving engagement, buzz, and loyalty—creating a flywheel effect via which lifetime customer value is lifted, a variety of channels and offerings are boosted, and the entire business benefits. As strategic tools for brand and awareness building, experiences can forge deeper connections with megafans while also playing a critical role in reaching new audiences. Especially young audiences: Research indicates that Gen Z consumers are significantly more likely than older generations to visit immersive experiences.

Exploring new attraction formats can enable a wider range of IP to be brought to life. While theme park rides are often tied to massive media franchises, smaller experiences can be built around niche TV shows, or even books with devoted fandoms. The Queen’s Ball: A Bridgerton Experience is an immersive, theatrical event based on a single Netflix series. Fans of the romance book series A Court of Thorns and Roses have flocked to pop-up events promoted largely through TikTok communities.

Consumer products and food brands can also serve as the centerpieces of attractions with alternative formats. Monopoly Lifesized turns a classic board game into a live, interactive competition. ChainFEST takes favorite fast-food brands and reimagines them through chef-driven pop-ups. Retailers—such as the children’s store Camp—are blurring the lines, leaning into experiences by combining shopping with immersive environments tied to IP.

“Fit-for-purpose experiences require less capital, can launch and replicate faster, and are easier to move on from if conditions change.”

Some companies are bundling multiple small attractions together. Netflix has launched two Netflix House locations in the Philadelphia and Dallas metros, with a third planned for Las Vegas in 2027. These mini theme parks house several experiences under one roof, all driven by Netflix IP. Universal, which operates traditional theme parks, is also meeting the need for satellite experiences with its Universal Kids Resort in Frisco, Texas, and Universal Horror Unleashed in Las Vegas.

For brands considering a location-based activation, clarity and discipline are essential. Success needs to be defined up front. Is the goal revenue boost, marketing impact, fan engagement, or some mix of all three?

Timelines also matter. Even a modest immersive experience can take more than a year to plan, build, and test. We see opportunities for technology and service providers to make this stand-up process easier as the category continues to grow. Coordination is especially important if the attraction ties into a product launch or media release.

Real estate owners are often eager partners because short-term attractions offer a way to generate foot traffic and revenue from underused spaces in, for example, malls, city-center storefronts, or casinos. But it’s important that the space, the location, and the experience are all suitably matched.

Execution and brand protection can’t be an afterthought. A poorly designed or badly operated attraction can damage both the IP and the venue. There are a lot of pieces to coordinate when operationalizing these experiences, including the tech stack, ticketing, physical signage, and so forth. Nailing the details can be difficult and time-consuming, but it’s vital to get them right. Industry veterans tell us that a bad experience can be incredibly memorable for consumers—in all the wrong ways.

Done right, however, IP-driven location-based entertainment offers a compelling path forward. These experiences can be flexible, faster to market, and better aligned with how today’s consumers—especially younger ones—want to spend their time and money. For brands that are willing to experiment thoughtfully, ushering IP into the real world doesn’t always require going big.

—Edited by Seth Stevenson, senior editor, New York

ABOUT THIS AUTHOR

Kabir Ahuja is a senior partner in McKinsey’s New York office.