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

[HauntedPirate]

It leads into Hugh "G" Johnston's comments about catering to wealthy. They feel they have enough of a cushion with guests that a comfortably numb spending their money that they don't need cary out catering to a general audience strategy. Whether it's viable long term is irrelevant, because it brings in results now.

But it is Disney's preferred guest profile.

 

[WDWhopper]

So far, Disney has been lucky, because they’ve been able to raise prices to offset lower attendance. At some point, and that point is coming, people will not only not show up, but they won’t spend as much when they do. That will be the quarter that will be shocking for Disney. To be honest, I think it will be shocking for many companies. You can only kick the can down the road for so long. We’re going to go through a period of time that’s the opposite of revenge travel. Call it the post Covid blues.

 

[jah4955]

Disney CFO Highlights Strength of Higher-Income Guests as Key Driver Behind Parks Performance​

Disney CFO Highlights Strength of Higher-Income Guests as Key Driver Behind Parks Performance

Disney CFO Highlights Strength of Higher-Income Guests as Key Driver Behind Parks Performance

www.wdwmagic.com

I never thought they'd flat-out admit it.

1976 Guide: "...the rigid rules of the organizers of WALT DISNEY WORLD [their capitalization] are assuring the public of a honest return on the money spent. So everybody can afford [their emphasis in bold] to visit Walt Disney World if the visit is planned carefully."

Not only have they intentionally blocked virtually everyone else out (who doesn't go into deep debt], they are counting on a demographic that can not only get a much greater "return on their money spent" anywhere else in the "luxury tier," they don't even seem to be trying to woo the next generation (assuming the current generation of "Higher-Income Guests" don't lose interest first).

At least you no longer have to pay "extra" (overtly) for parking or housekeeping if you stay at a WDW hotel

 

[jah4955]

Time off and leisure are treated completely differently in Europe than here.

There it is mandatory…it’s not up for debate. Try to deny leisure and les miserables breaks out

Here you’re often shamed and looked down upon for daring to do it. That’s why there is inherent monetary scrutiny and pressure. It’s Stockholm syndrome. We all must shovel coal in the furnace of free market to keep it blasting at all times. We don’t even retire anymore…

Try to sell that in France

Those other things were red herring “social” constructed whipped up by the SM companies that do nothing but rot Brains

My (large) European family was beyond-shocked (and this was way back in 2005) to learn I worked more than 35 hours a week (sometimes literally twice that, never-ever less than 45/week). I still know of many who routinely work over 100 hours week in and week out (and there are only 168 hours a week for everything, including sleep).

Nm you have to work for most companies several years to "build up" to the level of being permitted two weeks vacation a year (seems Europe has been "automatic" 1-3 months/year).

More and more either perpetually postpone retirement, or realize they can't afford it after a couple years and return to work (thank goodness I love what I "do!")

The problems do go beyond Disney...haven't heard many good proposals to solve yet.

Europe has their problems, but the need for a better "work/life balance" is one of ours imo.

NB: I did suspect, while the uproar was happening, that Wendy's and Craker Barrell did what they did for "free publicity"

 

[jah4955]

I already decided long ago that I don’t need you anymore.

(It seems) they already decided long ago that they don't need you anymore.

 

[el_super]

I wanted to post again simply to say that I honestly mean no offense to anyone who still visits Di$ney Park$ with comments I make about such people from time to time. I am envious of your ability to enjoy them. But I will also reiterate that I cannot comprehend how you can spread your hard-earned dollars towards a company that views you with such disdain.

Sure. As someone who was once a regular and stopped going primarily because it felt too busy, anything they can do to limit and control crowds is a plus to me. Raising prices seems like the fairest way to decide who can and cannot go, which is something they have had to do since day one. For all the price increases, it still feels too busy to me.

I've seen about 30 or 40 years of "this time they've gone too far" every time a price increase has been announced. This time, they haven't even raised the prices yet. They will be fine.

 

[el_super]

But capacity at a theme park is, in most cases (yes, I know there is an actual capacity, but how many days a year is that actually hit?), whatever the operator says it is.

Not really. If they have a new ride, and everyone goes in expecting to ride that attraction, they definitely end up hitting capacity limits and having to turn people away. People don't judge attractions as equal experiences, so they get disappointed when you turn them away from Tron and tell them to ride the Jungle Cruise instead.

Disney's decisions here aren't just about increasing stockholder value: they know they have to appease both sides. They know they need happy guests to come back and they know that they are willing to accept price increases for a better product.

 

[jah4955]

Sure. As someone who was once a regular and stopped going primarily because it felt too busy, anything they can do to limit and control crowds is a plus to me. Raising prices seems like the fairest way to decide who can and cannot go, which is something they have had to do since day one. For all the price increases, it still feels too busy to me.

I've seen about 30 or 40 years of "this time they've gone too far" every time a price increase has been announced. This time, they haven't even raised the prices yet. They will be fine.

I remember the fuss over $20 tickets in the '80's...but ...the rate of hikes vs inflation has been much more aggressive of late.

 

[el_super]

So far, Disney has been lucky, because they’ve been able to raise prices to offset lower attendance. At some point, and that point is coming, people will not only not show up, but they won’t spend as much when they do.

Disney controls the attendance. They could lower the pricing to fill the park if that was their goal. It's not.

They've been trying to re-set expectations of what pricing at the parks should be. They need to justify spending $60B+ on new attractions and lands, and the only way to justify that is showing that people would be willing to pay more for the experience. They gave away the parks for too cheap for far too long ... chasing that record attendance.

 

[jah4955]

Disney controls the attendance. They could lower the pricing to fill the park if that was their goal. It's not.

They've been trying to re-set expectations of what pricing at the parks should be. They need to justify spending $60B+ on new attractions and lands, and the only way to justify that is showing that people would be willing to pay more for the experience. They gave away the parks for too cheap for far too long ... chasing that record attendance.

that's the bottom line. Attendance (alone) won't make shareholders happy (or those officers who depend on shareholder happiness).

 

[GhostHost1000]

Disney controls the attendance. They could lower the pricing to fill the park if that was their goal. It's not.

They've been trying to re-set expectations of what pricing at the parks should be. They need to justify spending $60B+ on new attractions and lands, and the only way to justify that is showing that people would be willing to pay more for the experience. They gave away the parks for too cheap for far too long ... chasing that record attendance.

They gave away the parks too cheap for far too long? Bob is that you?

Also I don’t care if they spend $80B on new attractions, if they don’t deliver quality to justify price increases, many more will stop going. The higher the price, the higher the expectation, and recent things delivered like Zootopia and Tiana’s isn’t going to cut it.

 

[Sirwalterraleigh]

My (large) European family was beyond-shocked (and this was way back in 2005) to learn I worked more than 35 hours a week (sometimes literally twice that, never-ever less than 45/week). I still know of many who routinely work over 100 hours week in and week out (and there are only 168 hours a week for everything, including sleep).

Nm you have to work for most companies several years to "build up" to the level of being permitted two weeks vacation a year (seems Europe has been "automatic" 1-3 months/year).

More and more either perpetually postpone retirement, or realize they can't afford it after a couple years and return to work (thank goodness I love what I "do!")

The problems do go beyond Disney...haven't heard many good proposals to solve yet.

Europe has their problems, but the need for a better "work/life balance" is one of ours imo.

So what you’re saying it…we have is bassackwards?

 

[KDM31091]

So far, Disney has been lucky, because they’ve been able to raise prices to offset lower attendance. At some point, and that point is coming, people will not only not show up, but they won’t spend as much when they do. That will be the quarter that will be shocking for Disney. To be honest, I think it will be shocking for many companies. You can only kick the can down the road for so long. We’re going to go through a period of time that’s the opposite of revenge travel. Call it the post Covid blues.

Yup. At some point the cards are maxed out and it’s just flat out not affordable to go or at least not spend what one used to spend. I’m not saying everyone is in debt. But even not in debt it’s a huge chunk of cash to go to WDW.

Tiana, Zootopia, generic looking refurbs of spaces, etc , things just aren’t looking good and yet the price keeps skyrocketing. I don’t get it. They destroy the Disney difference piece by piece and keep raising prices and things still sell out. A point is coming where this isn’t sustainable

 

[Tha Realest]

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:



... 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?"

The rollout of dynamic food pricing creates a bevy of opportunities for the Touring Plans Line app. Guests can how the price of Sleepy Hollow corn dogs and Mickey pretzels fluctuates during high crowd times.

 

[Tha Realest]

The wild part is that none of the experiences segment turmoil really matters to shareholders. Parks are the boiler room operation that keep the lights on for the rest of the company, but it's buried in the basement. DTC has got the penthouse corner office in shareholder's minds.

Josh doesn't know anything about studios and streaming. He's basically Chapek2, but smoother and more polished and better looking (with pants so tight they could strangle a python).

He’s Chapek with double the emotional IQ, four times the performative empathy, and a Madison Avenue makeover.

 

[KDM31091]

They gave away the parks too cheap for far too long? Bob is that you?

Also I don’t care if they spend $80B on new attractions, if they don’t deliver quality to justify price increases, many more will stop going. The higher the price, the higher the expectation, and recent things delivered like Zootopia and Tiana’s isn’t going to cut it.

Yeah the quality is going way down unfortunately and the price keeps going up and up and up

 

[DisneyHead123]

Dynamic pricing on hotels and park tickets doesn’t seem like a huge change from the price high and discount model. I do think if they tried that with food people would riot. I feel like Americans are almost neurotically aware of exact food prices. People will pay tens of thousands extra for a luxury SUV over a moderate sedan, but so help you if you price their yogurt fifty cents higher.

 

[MrPromey]

Maybe the uproars will make Disney quickly "retract" their plans as Wendy's did their quick "about-face?"

Another recent example of quick about-face (though not "dynamic pricing"): the proposed "Cracker Barrell redo."

People complaining but still spending isn't going to change a thing. Disney execs don't care if you can't afford a Disney vacation if you still go and put it on credit or if you can afford it and are unhappy but still pay.

The only thing that'll ever move them to change course is a loss in profits.

Maybe if you go to guest relations and complain loudly enough, you'll get a free cupcake but spoiler alert, those those $6-$7 cupcakes were almost pure profit, anyway.

Heads they win, tails we lose - only way to win is not to play.

Your previous comparison to casino gambling was a good one. Vegas wasn't built on the backs of winners and these days, neither is Disney.

 

[Sirwalterraleigh]

I wanted to post again simply to say that I honestly mean no offense to anyone who still visits Di$ney Park$ with comments I make about such people from time to time. I am envious of your ability to enjoy them. But I will also reiterate that I cannot comprehend how you can spread your hard-earned dollars towards a company that views you with such disdain. I know it's everywhere. We have to do it to eat, we have to do it to put a roof overhead, we have to do it every day in our lives, but I promise you don't have to do it on vacation.

I love what was built…long ago…it was and still is an amazing achievement…

And still Cling to the (admittedly foolhardy) hope that all the people incharge are gone before all of what was once great is ruined

But i’m an optimist

 

[Sirwalterraleigh]

Zero. It used to be hit around Christmas at MK but I think it's been nearly a decade since it happened. Can't find the articles on the main page from back in the day, but if I do, I'll post a link.

ETA: Ah ha. Last phased closure at MK appears to be NYE 2016:

UPDATED - Magic Kingdom has reopened to all guests after reaching capacity

Walt Disney World's first capacity closure of the 2016 holidays season comes on New Year's Eve.

www.wdwmagic.com

Last phased closure at MK before that was Christmas 2015.

I recall there being one on October 1, 2021, during the lackluster 50th anniversary celebration that day.

In better days…you’d get a phased closure of maybe one or two hours for one or two parks on the highest of high days…

But realistically they have never filled a parks that was “closed for the day”

And I was (im guessing not the only one) one who was in parks on the busiest day in its history