The Spirited 8th Wonder (WDW's Future & You!)

[ParentsOf4]

I think the point a lot of people are ignoring is that the Deluxe Customers are the target DVC Customers. If you look at @ParentsOf4 analysis from the opposite perspective, Disney has to expand DVC to the Deluxe resorts if it continues to poach Deluxe customers and convert them to DVC.

I don't view this as a tragedy, this is simply adjusting their inventory to align with what the customers are doing. DVC is successful right now and they are rallying around that strategy. If this is the wrong strategy or if the market changes I expect that TWDC will adjust accordingly.

When you look at it purely from a business perspective, converting existing Deluxe Resort rooms to DVC is a low-risk, high-return investment whose potential downside is many years into the future. For an organization that's reluctant to make significant capital investments in Orlando, it's a (financially) sound move.

All things considered, construction of the Villas at the Grand Floridian (VGF) is more difficult to fathom. (And I've heard stories.) Moving forward, it appears that Disney's DVC plans will be more attune to what's happenings at the Poly; not what happened at the Grand Floridian.

I understand that you might not consider it a tragedy, but I find it thoroughly depressing to realize that between the Poly and apparently now the WL, corporate Disney effectively is signaling that WDW is 'done'. Yes, there will be updates from time-to-time but WDW's glory days are firmly in the past.

 

[Cesar R M]

So which came first?

Iger

 

[Cesar R M]

Now that we've seen the new area open...I'm not sure that TWDC is wrong to play it soft. Hogsmeade is incredible. The only domestic land I would compare to it is Radiator Springs in DCA, which is also stunning. And, while I have not seen it yet, it looks like Diagon is even better. But....Diagon does not yet seem to be pulling in the people in huge numbers in the way that Hogsmeade did. Yes, EFG has an insane line, but some of that seems to be due to poor operations/uptime, and the rest of the land is not over-run. Granted, some of that is due to more foresight in planning for guest flow, etc., but Diagon does not seem to be the complete game-changer that Hogsmeade was.

If I remember correctly...
There was a thread where they reported that diagon crowd were higher than Hogsmeade.
The difference was.. Universal crew was prepared during Diagon opening and arranged the crowds in flawless ways to prevent overcrowding.

 

[Mike S]

When you look at it purely from a business perspective, converting existing Deluxe Resort rooms to DVC is a low-risk, high-return investment whose potential downside is many years into the future. For an organization that's reluctant to make significant capital investments in Orlando, it's a (financially) sound move.

All things considered, construction of the Villas at the Grand Floridian (VGF) is more difficult to fathom. (And I've heard stories.) Moving forward, it appears that Disney's DVC plans will be more attune to what's happenings at the Poly; not what happened at the Grand Floridian.

I realize that you might not consider it a tragedy, but I find it thoroughly depressing to realize that between the Poly and apparently now the WL, corporate Disney effectively is signaling that WDW is 'done'. Yes, there will be updates from time-to-time but WDW's glory days are firmly in the past.

Funny how corporate Disney tosses around Walt quotes and doesn't even stop to listen to them.

Or maybe this could be an admission they have no imagination left (for WDW at least) since they seem to firmly believe it's "completed". Meanwhile, the guys up the road have proven they have universal potential to improve and expand.

 

[culturenthrills]

Now that we've seen the new area open...I'm not sure that TWDC is wrong to play it soft. Hogsmeade is incredible. The only domestic land I would compare to it is Radiator Springs in DCA, which is also stunning. And, while I have not seen it yet, it looks like Diagon is even better. But....Diagon does not yet seem to be pulling in the people in huge numbers in the way that Hogsmeade did. Yes, EFG has an insane line, but some of that seems to be due to poor operations/uptime, and the rest of the land is not over-run. Granted, some of that is due to more foresight in planning for guest flow, etc., but Diagon does not seem to be the complete game-changer that Hogsmeade was.

This was covered in the other thread. Diagon is twice the size of Hogsmeade. Universal was prepared this time for the crowds. Opening Day for Diagon at USF exceeded the attendance of opening day of Hogsmeade.

 

[TinkerBelle8878]

I wonder if half the issue with DVC and now converting WL into all DVC has to do with overbuilding. Too many resorts. Too many rooms that go unfilled. So by changing over WL, they eliminate one of the 'Deluxe' resorts as a choice and get 'rid' of those rooms to people who've basically pre-paid. Then either DVC or whomever gets the money that would otherwise be lost revenue. If the Epcot area never built Boardwalk or built is as strictly DVC, would they now be converting over WL? Or if the POP/AllStars weren't all built? Or the family suites for that matter. If the rates came down and the ticket prices came down (or at least could be justified with new rides and attractions in parks that are languising), the rooms will be filled again. Or at least they won't be turning people off of the resort in droves.

I think they're only focusing on DVC owners because they have their money already. And they can keep 'pre-selling' rooms to them in a vicious cycle.

 

[jdmdisney99]

Or maybe this could be an admission they have no imagination left (for WDW at least) since they seem to firmly believe it's "completed". Meanwhile, the guys up the road have proven they have universal potential to improve and expand.

I see what you did there.

 

[WDW1974]

Log back on here now and what do I see as an ad?

Waldorf-Astoria O-Town offering rooms thru Labor Day for $199 a night. ... And folks pay that for Disney's motels. Amazing. ... and you do realize that the WA is making plenty of $$$ on that room, which is considerably higher class than any Disney room, right?

 

[crispy]

I hope this is on-topic, but it has been noted that the hotel occupancy rates have dropped significantly in the last few years from almost 90% to below 80%. Does anyone know specific numbers in each hotel category? It seems that DVC occupancy rates are very high. I want to say someone said 90+%, but I can't find the reference. Does anyone know the occupancy rate of deluxes vs. moderates vs. values? Which resorts seem to hit the sweet spot as far as occupancy rates? It seems that DVC resorts have high occupancy rates so they are moving to that model for deluxe resorts, but what about the moderates and values? Are most of their occupancy rates at acceptable levels?

I am wondering if the current changes to CBR are an effort to mimic the success at POR (I am assuming POR has a pretty high occupancy rate at this point because they are not being included in many of the discounts). With the current refurbishment, they are transitioning rooms that previously slept 4 into rooms that now sleep 5. I think they are making another effort to reach larger families at a lower price point and keep them onsite.

I also think it's another indication that the family suites at AofA are not in high demand, and I would guess it's because of the high price point. Which leads me to my next question - what do you do with a value resort with low occupancy rates since turning it into DVC isn't really an option? Offer steeper discounts on the family suites? Admit you picked the wrong price point and lower it to match those at All-Star Music? Shutter part of the resort? I personally was quite excited about the idea of the family suite until I saw the prices which are actually higher than some of the deluxe resorts (yes, it's a "suite" vs. just a room, but c'mon - $300+ a night at a value resort???). The Little Mermaid section seems to be filled (no discounts available and usually no rooms available), but the suites seem to be struggling.

 

[khale1970]

So what is your opinion as to why trashier less sophisticated people are visiting Disney and a more sophisticated higher class individual is visiting universal?

After visits to both UNI and WDW THIS past June, I'm calling the trashy element tally a tie. I went expecting better from UNI, but the grown, somewhat heavy women in bikinis and sheer bathing suit cover-ups and kids in swim suits playing in the water features evened up the the count. I get the water based rides get you soaked, but that was over the top.

 

[WDW1974]

So which came first?

Just like in our society ... it isn't an easy question.

 

[WDW1974]

So what is your opinion as to why trashier less sophisticated people are visiting Disney and a more sophisticated higher class individual is visiting universal?

Time to call it a night (here anyway), but I'd surmise that guests who visit UNI realize they are getting more for their money and a higher caliber product.

I don't like to generalize, but I will in this case ...

 

[the.dreamfinder]

Speaking of hotels... Disney and more has renderings of Shanghai's hotels. Thankfully, the flagship isn't another GrandFlo xerox.
http://disneyandmore.blogspot.com/2014/07/shanghai-disneyland-update-first.html

 

[GrammieBee]

I didn't retreat very far. If WDW is going to heck in a hand cart as many of you seem to think and expertly point out, I think I feel sorry for the DVC owners. They have no control over the large chunk of their money they gave to Disney. Plus, they have to keep giving more every year or two to buy points and have to pay for maintainance each year for the next what,thirty years? If there is poor maintainance, poor management, lower value,nothing new or whatever else to complain about, they are stuck. Disney already has their money. If they have points and don't use them, they are paying for a vacation that never happened. If they eventually decide there are other places out there worth visiting, besides something Disney, they no longer want to or can go to Disney on a regular basis,or,for some reason they simply can't afford it, what then? Probably hope they can sell it at a loss.

At least, if you pay as you go and you decide things are worse than you want, you can vote with your wallet and do something else.

 

[IAmFloridaBorn]

Reason I've never stayed at a Disney resort was the price. I was hoping for some pixie dust to bring them down but Tinkerbell ignored me.
NO more deluxe, guess I'll just save up.

 

[kpilcher]

Log back on here now and what do I see as an ad?

Waldorf-Astoria O-Town offering rooms thru Labor Day for $199 a night. ... And folks pay that for Disney's motels. Amazing. ... and you do realize that the WA is making plenty of $$$ on that room, which is considerably higher class than any Disney room, right?

And let me say, I have stayed at all different star-level hotels and motels around the real world (not just WDW), and the LBV Waldorf is one of the classiest I've experienced. It may be second to the Grand Bohemian in Downtown Orlando (until Four Seasons opens anyway) but there is an intangible difference to places run to this standard. Sounds snooty to say that, but it is true. And I notice a difference in guest behavior due to the intangibles. Grand Floridian used to be that way (so much so that I never really felt comfortable in the place). At $199 a night I'd really deeply consider a staycation.

 

[ThemeParkJunkee]

Grand Floridian in the 1980's was a truly deluxe experience. Now with all the Orlando options and the decreased serviced on the part of WDW...not so much. DVC seems to have cheapened the Deluxe resorts to a degree.

 

[seascape]

I hope this is on-topic, but it has been noted that the hotel occupancy rates have dropped significantly in the last few years from almost 90% to below 80%. Does anyone know specific numbers in each hotel category? It seems that DVC occupancy rates are very high. I want to say someone said 90+%, but I can't find the reference. Does anyone know the occupancy rate of deluxes vs. moderates vs. values? Which resorts seem to hit the sweet spot as far as occupancy rates? It seems that DVC resorts have high occupancy rates so they are moving to that model for deluxe resorts, but what about the moderates and values? Are most of their occupancy rates at acceptable levels?

I am wondering if the current changes to CBR are an effort to mimic the success at POR (I am assuming POR has a pretty high occupancy rate at this point because they are not being included in many of the discounts). With the current refurbishment, they are transitioning rooms that previously slept 4 into rooms that now sleep 5. I think they are making another effort to reach larger families at a lower price point and keep them onsite.

I also think it's another indication that the family suites at AofA are not in high demand, and I would guess it's because of the high price point. Which leads me to my next question - what do you do with a value resort with low occupancy rates since turning it into DVC isn't really an option? Offer steeper discounts on the family suites? Admit you picked the wrong price point and lower it to match those at All-Star Music? Shutter part of the resort? I personally was quite excited about the idea of the family suite until I saw the prices which are actually higher than some of the deluxe resorts (yes, it's a "suite" vs. just a room, but c'mon - $300+ a night at a value resort???). The Little Mermaid section seems to be filled (no discounts available and usually no rooms available), but the suites seem to be struggling.

In 2006 Disney was at 86% capacity. That is the highest they have had this century. They were 79% in 2013 and will be over 80% this year. I think the number will be the 82% or just a fraction higher. In hotel terms that is amazing. The problem here is people talk about empty rooms on a given night without understanding the industry. If a company is averaging over 85% is does not have enough rooms or is charging too little. In fact the highest hotel occupancy was in a given year this century was about 63% nation wide in 2006. However as pointed out earlier Orlando is not anywhere and so occupancy should be higher but over 80% even in Orlando is excellent especially since as everyone else has pointed out Disney is more expensive than neighboring hotels. I bet Universal would love to have Disney's hotel occupancy rate. I just called and they have rooms at each of their hotels this weekend. There is nothing bring with that and it should be expected but it just shows rooms are always available except for 1 or 2 nights a year. That is the hotel business.

Also just for the record if you check my prior posts you will always see when I used rooms for comparison I always used 80% occupancy rates for my numbers and 2 per room. I knew that was low because at Disney and Universal they should average more than 2 people per room but in most years both Disney and Universal should average 80% occupancy. Our. The other hand DVC occupancy average 95%. Therefore provides more attendance for the parks.

 

[asianway]

I wonder if half the issue with DVC and now converting WL into all DVC has to do with overbuilding. Too many resorts. Too many rooms that go unfilled. So by changing over WL, they eliminate one of the 'Deluxe' resorts as a choice and get 'rid' of those rooms to people who've basically pre-paid. Then either DVC or whomever gets the money that would otherwise be lost revenue. If the Epcot area never built Boardwalk or built is as strictly DVC, would they now be converting over WL? Or if the POP/AllStars weren't all built? Or the family suites for that matter. If the rates came down and the ticket prices came down (or at least could be justified with new rides and attractions in parks that are languising), the rooms will be filled again. Or at least they won't be turning people off of the resort in droves.

I think they're only focusing on DVC owners because they have their money already. And they can keep 'pre-selling' rooms to them in a vicious cycle.

It's all about margins. They could fill every room if they wanted, and make money. This is about making ENOUGH money to satisfy their profit per square foot metrics. ENOUGH money to hide the overhead at all the support offices(yes, talking about the PR dept), ENOUGH money to lift their margins so they don't look like chumps next to the television segment.

Margins used to be even higher in the old days though, right @ParentsOf4 ?

 

[WildcatDen]

does your response post bring it back to center

I don't know about center, but I did stay at a Holiday Inn Express last time I traveled. Mmmm Cinnamon Rolls.

On a different note but slightly on topic, our first 3 trips were spent at Caribbean Beach and we really enjoyed it. I have heard all the talk about all Disney Resorts being overpriced and I really do not disagree, but as others have said, you are paying for the location. This past trip we 'downgraded' to POP. We were pleasantly surprised.

If DVC were to make it to a moderate and be priced accordingly, they may succeed in reaching a new market that may have considered DVC 'out of reach'.

Now, on a recent trip to UNI, we stayed at The Castle. The rate was $100 a night and the room was much nicer than anything we have had at Disney. Was it as 'magical' as staying somewhere on property, to me, no, to my wallet, yes.

So there you go, this may not have brought it back to center, maybe right of center but that should surprise no one.