News Disney CFO Hugh Johnston Says Dynamic Pricing Is Coming to the Parks

[Sirwalterraleigh]

How long has this guy been CFO?

Don’t know…but he was just given a new contract for “human shielding”

 

[ChrisFL]

I was watching a YouTube
2900 percent rise from 1971 to 2015 LOL.
THATS 10 years ago!!
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While 2900% may be sort of accurate, they changed ticketing around 1982 to end the A-E individual attraction tickets, so I'm guessing that 1971 (and 1981?) number only considers the gate price.

 

[disneylandtour]

Yes, that is exactly how I'd like to spend my vacation days at WDW: price checking the available restaurants every 10 minutes to see where I can get the best deal.

As opposed to now, where many people continually check to see if a better restaurant has a cancellation and therefore availability.

 

[disneylandtour]

Does anyone here actually think Disney's IT is actually up to this task?

LOL. When has poor IT stopped Disney from anything? Let me tell you about my time at Disneyland on the day they first rolled out Genie+.

 

[CAV]

I'd be curious to see how this affects hotel occupancy. Put aside the general disgust for the concept of Dynamic pricing, but an empty room generates $0 in revenue. We pretty much know that the price changes will only be upwards, and Disney constant moves inventory around to different promotion campaigns and also to wholesalers like Priceline and Hotels.com.

Does this mean more empty rooms as a result of ironically a dynamic pricing scheme that is inflexible to make available rooms that will never be sold?

Most guests aren't chumps and are not going to look back, especially if the price point only goes up. If they're basing a US rollout on how the Europeans did it and with data collected and feedback derived from DLP, they're going to be very surprised at how big of a mistake they're making.

About 8 years ago and back, I made significantly less than 6 figures a year. However, I could still afford and, more importantly, find value in a deluxe resort room considering the rates.

Fast forward 5 years, I make almost 4 times six figures. I refuse to pay the exorbitant rates Disney charges for a deluxe resort. $700 and more for a room is lunacy even at AP rates. We stay at moderate resorts. By staying at a moderate we spend less than we would if we stayed at a deluxe. Not just for the room, but for the associated meals we would have consumed at the resort's restaurants.

 

[Jambo Dad]

Here's a section from the transcript of the Q&A about this:

Stephen K. Hall, Media and Cable Analyst, Wells Fargo: Just to go back to your comment on the higher-income decile, where you tend to index to on the consumer side, and you talked about the strong per caps spend you saw in the year, I think you’ve had this yield-based approach to managing your domestic parks over the last few years. Some of the work we’ve done suggests that’s a lot of the reason those margins have been so strong. Can you speak a bit about the yield-based approach and what that means for how you manage the assets?

Hugh Johnston, Chief Financial Officer, The Walt Disney Company: Yeah, we do very much focus on how to basically generate incremental revenue, both at the ticket price level, as well as food and beverage and merchandise and all the ancillary services that we offer, like Lightning Lane and VIP tour guides and those types of things. The team has really gotten increasingly better at getting that yield up, particularly in years where we’re not adding capacity in a particular park. That’s going to be the primary growth driver, is all of that yield focus. In addition to that, we’re actually investing in creating dynamic pricing. We’re doing it in Paris right now. We’ve been doing it for about a year. It’s off to a very good start, but we’re really going to make sure we optimize it before we bring it into the domestic park.

That’s probably something that you won’t see this year, but you may see in the subsequent years.

Stephen K. Hall, Media and Cable Analyst, Wells Fargo: Is the kind of airline pricing model the best way to think about it?

Hugh Johnston, Chief Financial Officer, The Walt Disney Company: I’d like to not think about it that way, to be honest with you. Yeah, similar. We already do it in the hotels to some degree, so this is basically just bringing it in the parks, but done in a way that obviously doesn’t create guest experience issues or consumer negative feedback and all of that. Frankly, so far in Paris, we haven’t seen any.

This is horrific and they aren’t even hiding it anymore. He talks of ‘getting the yield up’ like it’s something positive. Extracting as much cash as possible in times when they aren’t getting growth from capacity. They have no shame - and no limit to their rapaciousness.

 

[Tha Realest]

This is horrific and they aren’t even hiding it anymore. He talks of ‘getting the yield up’ like it’s something positive. Extracting as much cash as possible in times when they aren’t getting growth from capacity. They have no shame - and no limit to their rapaciousness.

Getting the yield up during times when they have no expansion coming online (now-late 2026). Implicit in there is how they will let loose once stuff like the new builds come out.

 

[Sirwalterraleigh]

As opposed to now, where many people continually check to see if a better restaurant has a cancellation and therefore availability.

Reservations are wide open…especially the day of…

That was a splitter and you swung over top of it

 

[KDM31091]

This is horrific and they aren’t even hiding it anymore. He talks of ‘getting the yield up’ like it’s something positive. Extracting as much cash as possible in times when they aren’t getting growth from capacity. They have no shame - and no limit to their rapaciousness.

The greed at some point will bite them though. Even hardcore Disney fans eventually have a price ceiling where they refuse to go or it just simply becomes impossible to go.

But let’s squeeze who is coming for all they’re worth.

Honestly the future of Disney parks scares me in many ways.

 

[Sirwalterraleigh]

This is horrific and they aren’t even hiding it anymore. He talks of ‘getting the yield up’ like it’s something positive. Extracting as much cash as possible in times when they aren’t getting growth from capacity. They have no shame - and no limit to their rapaciousness.

For those that know anything of the history of why Disney has been so successful…those types of comments are shockingly inappropriate…

Times always change…but you have to stay in your lane regardless.

This is standard issue low energy business approach. It’s Comcast or hewlett packard.

Hell…who are we kidding?…it’s old Comcast. Newer version at least tries a little

 

[Cinderellalady]

Travel Agent: ok your vacation will cost you X

Customer days later: ok we are ready to book!

Travel Agent: oh that’ll cost you more now

Customer: ….

Customer: Forget it!!!

 

[Cinderellalady]

Customer: Forget it !!!

 

[Sirwalterraleigh]

But let’s squeeze who is coming for all they’re worth.

This is all the emperor has done since his rigged triumphant return.

In an OCD quest for ego and legacy…he can’t do anything right.

The irony can be cut with a knife it’s so thick

 

[Dranth]

@Dranth

…which way are we leaning on those 2 scenarios?

It doesn't look promising, but at least they seem aware of the perception issues. If nothing else it will be interesting to see how they try to push it out and what messaging they attach.

Just my opinion of course, but done wrong they will push a whole bunch of people over the edge.

 

[BrianLo]

What at DLP has dynamic pricing?

When you book a hotel stay, it includes length of stay hopper tickets, and any meal plans or characters breakfasts are prepaid as well at the time of booking if you select them. Same with premier pass (their version of LL).

Is it restaurant pricing? Quick service only? Parking rates?

Exactly that. If you delay booking for 2-3 months the total price could be different.

There’s probably a tad over reaction on this one.

 

[BrianLo]

Getting the yield up during times when they have no expansion coming online (now-late 2026). Implicit in there is how they will let loose once stuff like the new builds come out.

There was clarification that this is a ways out. At least another (?fiscal) year.

“We’ve actually invested in creating dynamic pricing. We’re doing it at Disneyland Paris right now, and have been for about a year. It’s off to a very good start. But we’re really going to make sure we optimize it before we bring it into the domestic parks. That’s probably something you won’t see this year, but you may see in the subsequent years.”

 

[Sirwalterraleigh]

Exactly that. If you delay booking for 2-3 months the total price could be different.

There’s probably a tad over reaction on this one.

Not if you read that horrid Q&A

Id say we’re more joking/underplaying it.

This is a corporate exec in very “certain terms” talking about screwing the people that dare set foot in their amusement parks.

I had to read it several times…as even I can’t swallow that kinda hubris on the first pass

 

[lentesta]

There was clarification that this is a ways out. At least another (?fiscal) year.

“We’ve actually invested in creating dynamic pricing. We’re doing it at Disneyland Paris right now, and have been for about a year. It’s off to a very good start. But we’re really going to make sure we optimize it before we bring it into the domestic parks. That’s probably something you won’t see this year, but you may see in the subsequent years.”

That's one of my big questions: is "this year" the calendar year 2025 or Disney's fiscal 2026?

Also, tooting my own horn, here's me from December 2024:

Yield Management has funded FY2025 Dynamic Pricing projects for tickets and hotel rooms for WDW and DLR, just like DLP.

... and the interesting thing there is that, as far as I could tell, there were not dynamic pricing initiatives for food, merch, or experiences in the works back then.

But Johnston said they're working on those too. So I'm trying to figure out whether those were always in FY2025 or if they were added. If they were added, that happened in calendar 2025, when the WSJ and NYT had major articles on how the parks were unaffordable to large swaths of the country? Was the pitch for those projects titled "Damn The Torpedoes?"

 

[BrianLo]

Not if you read that horrid Q&A

Id say we’re more joking/underplaying it.

This is a corporate exec in very “certain terms” talking about screwing the people that dare set foot in their amusement parks.

I had to read it several times…as even I can’t swallow that kinda hubris on the first pass

I think I’m missing something to be honest. Though I generally plan aggressively ahead don’t run the risk of a last second visit with high prices for revenue management. This just seems to be something that won’t impact the ADR crowd.

Meanwhile Disney emailed to inform me that my Alaskan cruise price was dropped, which is horribly uncharacteristic of them. Sound the alarms.

 

[Sirwalterraleigh]

I think I’m missing something to be honest. Though I generally plan aggressively ahead don’t run the risk of a last second visit with high prices for revenue management. This just seems to be something that won’t impact the ADR crowd.

Meanwhile Disney emailed to inform me that my Alaskan cruise price was dropped, which is horribly uncharacteristic of them. Sound the alarms.


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That “adr crowd” has an APB out on it…there’s nobody making them. Don’t believe my schtick…look Today…or anyday…check it. They’ve already cut the capacity down for cost savings and still can’t fill them. The DDP killed that…

“Dynamic” food pricing is just another fomo tactic on product that isn’t needed. Like lighting lane.

They can’t do anything different…openly admitting they aren’t seeking new customers…just paralyzed.

I know there is a defender tendency to downplay bad decisions…just as there is a critic tendency to pour gas and throw a match on them…oppo sides of the scale…

But there’s no way to twist on this one. I knew some would try though…don’t be “that guy”

This doesn’t “reward” any customer…it’s a shell game and mind tricks to price gouge. Again…there is no scarcity therefore there’s no justification.