155 Q UA RT E R _ 0 2 _ 2 0 2 6 should be thoroughly vetted. A subpar idea for a new location-based experience—or even a great idea that’s poorly executed—can create lasting headaches for the owners of both the associated IP and the experience venue. “For real estate holders, you need to give serious consideration to whether the experience will actually bring in more revenue and foot traffic than a restaurant or retail store would,” says Caesars’ Holdren. “And if it’s your IP that’s being brought to life, it should be an experience that you take an active hand in developing—just as you did when you were creating the IP itself. A bad experience will be memorable in a disastrous way, and it can for ever damage a customer relationship.” - Smaller-scale, transitory, and IP-driven loca tion-based entertainment formats are poised to play an increasingly pivotal role for brands, media companies, and consumer-facing businesses that want to engage their audiences in immersive new ways. These flexible attractions offer considerable - advantages—from lower investment requirements and faster time-to-market to more targeted, high-impact audience engagement—which can make involvement in immersive experiences more accessible and strategically attractive for many companies. Maximizing the potential of these initiatives requires thoughtful execution and operational discipline to mitigate risks and ensure each project delivers on its promise. With the right approach, however, these innovative location-based entertainment models can serve as a powerful growth lever, helping companies captivate fans and drive tangible value through unforgettable experiences. » Alex Gersovitz is a partner in McKinsey’s Southern California office, Bo Finneman is a senior partner in the Miami office, Kabir Ahuja is a senior partner in the New York office, and Matthew Straus is a partner in the Chicago office. » The authors wish to thank Filipa Douma and William Abbey for their contributions to this article.