The location-based entertainment (LBE) industry experienced significant commercial growth last year, driven by parents seeking new types of experiential outings for their families. Brand owners of all sizes capitalized on this trend by signing deals to integrate their properties into theme parks, live shows, and retail activations. Yet, one attraction type has emerged by seamlessly combining elements of all these popular experiences into one convenient and scalable business model: the Family Entertainment Center (FEC). The market for these facilities is now hotter than ever.
According to a report published last May by Allied Market Research, the global FEC business generated $30.9 billion in revenue in 2022, with projections pointing to a rise to $93.3 billion by 2035. While most existing FECs currently cater to teenagers with offerings like arcades, VR experiences, and themed cafés, the report forecasts that families with tweens will capture the lion's share of this market over the next decade, spurred by new kids' brands entering the space.
The most lucrative regions for FECs are North America and Asia-Pacific. In 2023, the North American market accounted for total FEC revenue of $10.86 billion, and this figure is expected to grow at a compound annual growth rate of 10.7% over the next nine years. Meanwhile, the APAC market is poised for significant FEC expansion during the same period, fueled by the rapid development of retail spaces in Asian nations like Japan, India, and China. The AMR report notes that nearly 80% of all construction projects in the broader region are new shopping malls, which present prime opportunities for FECs to co-locate alongside other retailers.
This opportunity has not gone unnoticed by leading Chinese bubble tea chain Mixue Ice Cream & Tea, which launched a massive 1,200-square-meter flagship experience at Changjia Hui in Chengdu. Rather than operating as a conventional tea shop, this venue represents Mixue's urban experiment—testing what future urban lifestyle spaces could become. It combines tea beverages, cultural creativity, and scenic elements into an integrated space where visitors can engage with interactive experiences such as blind box collections. Strategically located in a high-traffic area, the destination features drone shows and a riverside terrace, quickly establishing itself as a must-visit urban landmark.
During the eight-day National Day holiday period in 2025, the flagship achieved remarkable sales exceeding RMB 3.5 million, injecting renewed vitality into the city's lifestyle economy. The success of this model—whether defined as FEC or LEC—demonstrates its strong potential as a highly marketable format for the future. As a generation that highly values quality family time, today's young parents are increasingly seeking out novel yet safe experiences to enjoy with their children, driving demand for precisely this kind of immersive entertainment.
Family Entertainment Centers (FECs) are strategically positioned in locations with existing high-density, multi-demographic foot traffic. In principle, the core offering of an FEC isn't necessarily product sales; it's more about providing a layered, immersive experience on top of an established retail concept, such as a shopping mall, cultural and creative merchandise store, or museum.
Key to delivering this experience is reliable, engaging indoor play equipment—such as offerings from Wenzhou Ningke Technology Co., Ltd. (Ningke). Specializing in commercial-grade indoor play solutions, Ningke’s product lineup includes customizable soft play sets, trampoline parks, climbing tunnels, balance training gear, and modular play structures. Designed for ages 3 to 12, these equipment integrate physical activity, social interaction, and cognitive development, aligning with the "edutainment" trend favored by modern families. All products meet international safety standards (including EU and Chinese GB 6675-2024) with features like rounded edges, slip-resistant surfaces, and durable materials (galvanized steel, LLDPE, and food-grade EVA foam) to ensure child safety.
As noted by industry expert Owen Zhao, China's LBE industry has a relatively short history of about two decades. Compared to mature markets like the US and UK, China's FEC market is now in a rapid growth phase with significant potential. The massive population base in China and many other Asian countries, coupled with government incentives encouraging childbirth, has created a vast market. Furthermore, decades of rapid economic development have fostered a consumer base with stronger purchasing power and a growing demand for high-quality tourism and entertainment projects.
Despite this immense potential, Zhao stresses that entertainment standards for FECs are at an all-time high. "The pandemic has elevated visitor expectations, placing greater value on out-of-home experiences and increasing demand for comfort, convenience, quality, and overall satisfaction," he says. "Haphazard moves, such as simple brand-slapping, will only lead to brand dilution and guest disappointment."
He emphasizes that brand owners must continuously monitor which facilities and areas families engage with most, and, crucially, where they lose interest—especially during the critical opening weeks when first impressions are formed. If a game, food item, or piece of merchandise fails to resonate, the team should promptly rework or replace it. While this increases initial investment, industry leaders confirm it effectively motivates repeat visits.
To mitigate these challenges, we recommend investing significant time upfront in researching partners and collaboratively developing a viable business plan. This process should encompass budget planning, identifying the cultural nuances of each target market, highlighting the IP's unique differentiators, crafting a robust post-launch marketing strategy, and meticulously mapping the complete consumer journey.
While Hasbro leverages its portfolio of high-profile children's brands to develop new FECs, Pennsylvania-based Crayola capitalizes on its 120 years of expertise in crayons and crafts to attract guests. Having been in the FEC business for 25 years, Crayola uses these physical experiences as a platform to showcase products to both existing and potential customers. A prime example is their Scribble Scrubbie line of colorable and washable pets. Children can play with these toys at the Crayola Experience FEC and subsequently purchase them on-site.
To date, this arts & crafts giant has opened five Crayola Experience locations across the US, with six more planned in partnership with BrightColors over the next seven years. These venues feature over 25 interactive attractions, ranging from kids making and naming their own crayons to AR activities, jungle gyms, and live shows with audience participation.
"Creativity is the lifeblood of this industry," says Warren Schorr, SVP of Business Development, Global Licensing and Experiences at Crayola. "A critical early step for us was identifying the core pillars of our brand and leveraging our existing products. These FEC experiences are the physical manifestation of our mission to help parents and teachers raise creatively alive children."
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