News 2018 ticket price increases

[WDWTank]

...is there anybody out there that honestly believes that for a second?

That would lower stock prices

 

[mikejs78]

...is there anybody out there that honestly believes that for a second?

I do. They want less people to reduce crowd pressure and overhead, but higher ticket prices so they still increase revenue/profit while doing it.

To illustrate: do you think Disney would rather have 1,000,000 guests paying $200 per guest average spend, or 750,000 guests with $500 per guest average spend?* Reducing crowds does have a benefit to them, and doing that while increasing revenue and profit is the goal.

* Numbers are for illustration and not representative of real spend..

 

[ParentsOf4]

Is there any evidence that attendance has increased so much that they need to take this pricing strategy? If anything anecdotal evidence suggests an overall attendance decline during peak times. Hotel room occupancies (non dvc) are down and guest spending is down. I know @ParentsOf4 had some numbers to correlate this and can probably speak better than I can about it. My thinking is that Disney is simply trying to compensate for lower attendance by charging more and cutting back park hours and entertainment and adding more upcharge events just to maintain the bottom line.

The numbers at the domestic resorts have been very good in recent years.

Attendance is up and hotel occupancy is strong.

Per Capita Guest Spending is good, Per Room Guest Spending is good.

With the opening of Pandora, some might have expected even better numbers but, based on historical data, the numbers are the best they've been in the 21st Century.

I really am overdue to write an analysis of Parks & Resorts 2017 financial performance.

 

[kong1802]

Yeah even for a hardcore fan like me I would not be going at those prices. $200 a day would mean my AP would probably be $2000/person. I feel like I can justify $700 because we go a decent bit, but the $1000/person is probably my breaking point for an AP

I'm with you there. I really balked this year at the $750. No way will I go at $1000.

It will be Sea World/Uni from here on out if that takes place..

I'll have to slowly start switching out some elsa dolls for minions.....

 

[Sirwalterraleigh]

I do. They want less people to reduce crowd pressure and overhead, but higher ticket prices so they still increase revenue/profit while doing it.

To illustrate: do you think Disney would rather have 1,000,000 guests paying $200 per guest average spend, or 750,000 guests with $500 per guest average spend?* Reducing crowds does have a benefit to them, and doing that while increasing revenue and profit is the goal.

* Numbers are for illustration and not representative of real spend..

If you look at the where the parent company is, reducing attendance is the opposite of what they want to do.

The problem with Orlando has nothing to do with Orlando beyond the cost of labor...

It's in battery park, lower manhattan

 

[King Panda 77]

 

[jakeman]

If you look at the where the parent company is, reducing attendance is the opposite of what they want to do.

The problem with Orlando has nothing to do with Orlando beyond the cost of labor...

It's in battery park, lower manhattan

I really like that Wall Street (ALL OF IT) really wants to just really screw over Walt Disney World in particular.

I mean, there's 5 other theme parks, 4 cruise ships and plenty of other divisions at TWDC but in the giant meetings of Wall Street, everyone in their top hats and cigars, they are like, "ESPN is only making us a gajillion instead of a botillion. What should we do?" "I know! We'll just royally WDW in particular." "By jolly that should solve all of our problems!" "Good show! Manager bonus!"

 

[Sirwalterraleigh]

I really like that Wall Street (ALL OF IT) really wants to just really screw over Walt Disney World in particular.

I mean, there's 5 other theme parks, 4 cruise ships and plenty of other divisions at TWDC but in the giant meetings of Wall Street, everyone in their top hats and cigars, they are like, "ESPN is only making us a gajillion instead of a botillion. What should we do?" "I know! We'll just royally **** WDW in particular." "By jolly that should solve all of our problems!" "Good show! Manager bonus!"

And that is EXACLTY what is going on...in essence.

Espn is/was 40% of walkaway profit...parks are 30%...

Parks now have to rise to 40% while they try to get this streaming cable thing off the ground.

And where's the money tree to shake? Orlando...always has been.

Did you expect Paris or the gridlock on the 5?

 

[jakeman]

And that is EXACLTY what is going on...in essence.

Espn is/was 40% of walkaway profit...parks are 30%...

Parks now have to rise to 40% while they try to get this streaming cable thing off the ground.

And where's the money tree to shake? Orlando...always has been.

Did you expect Paris or the gridlock on the 5?

You might be right. Perhaps I'm biased because the main proponent of that theory for years is a categorical liar,.

Logically, it doesn't make sense to me that an entire division at TWDC is apparently crashing and burning and yet one theme park out of the entire Parks and Resort division out of the entire company is the one being tasked to pick up the slack. Seems to me that would be the equivalent of DHS being in it's current state, but they start feeding everyone bologna sandwiches on the Magic to make up the difference.

Perhaps you and others have a better grasp of the business side of this than I and can divine information out of the financials that point to this correlation. I haven't tried nor do I care to. I just know I've been here long enough to know where the correlation theory started and that's enough for me to doubt it.

 

[Sirwalterraleigh]

You might be right. Perhaps I'm biased because the main proponent of that theory for years is a categorical liar[/USER].

Logically, it doesn't make sense to me that an entire division at TWDC is apparently crashing and burning and yet one theme park out of the entire Parks and Resort division out of the entire company is the one being tasked to pick up the slack. Seems to me that would be the equivalent of DHS being in it's current state, but they start feeding everyone bologna sandwiches on the Magic to make up the difference.

Perhaps you and others have a better grasp of the business side of this than I and can divine information out of the financials that point to this correlation. I haven't tried nor do I care to. I just know I've been here long enough to know where the correlation theory started and that's enough for me to doubt it.

There's no secret here...and you don't have to be a Director of Wharton Business School to figure it out either...

It's taken about 20 years...starting with exposure behind a name tag...to see the whole endgame. Lots of reading, and healthy skepticism.

As far as "categorical liar"...blind squirrels do find the nuts occasionally.

What's going on with attendance/pricing?

...if I may...

1.
Company states that they are increasing price to reduce attendance, ensure luxury...

Subliminal: "you upper crust middle classes will be elite and not deal with the six flags riff raff...like you've always wanted to feel"

2. Company vastly increases prices rapidly to soften stances on value/expectation.

...that's been going on for a decade

3. Once price expectation starts being driven upward at frantic pace, increase capex and infrastructure to flood 20% more on property and increase profit level outright.

...in this case, company expects that "softened" clientele will continue to pay the price and deal with bigger crowds due to the Branding attachment as opposed to rejecting it.

End of the day: they are statistically correct and can squeeze more wine from the largely used grapes.

But is my "theory"...it's only halfway true at this point. We'll see. Does anyone think all that construction going on now is to serve less than the 52 mil or so guesstimated to attend each year? So wait times and fastpass are better?

...Shirley, ye jest...

 

[jakeman]

There's no secret here...and you don't have to be a Director of Wharton Business School to figure it out either...

It's taken about 20 years...starting with exposure behind a name tag...to see the whole endgame. Lots of reading, and healthy skepticism.

As far as "categorical liar"...blind squirrels do find the nuts occasionally.

What's going on with attendance/pricing?

...if I may...

1.
Company states that they are increasing price to reduce attendance, ensure luxury...

Subliminal: "you upper crust middle classes will be elite and not deal with the six flags riff raff...like you've always wanted to feel"

2. Company vastly increases prices rapidly to soften stances on value/expectation.

...that's been going on for a decade

3. Once price expectation starts being driven upward at frantic pace, increase capex and infrastructure to flood 20% more on property and increase profit level outright.

...in this case, company expects that "softened" clientele will continue to pay the price and deal with bigger crowds due to the Branding attachment as opposed to rejecting it.

End of the day: they are statistically correct and can squeeze more wine from the largely used grapes.

But is my "theory"...it's only halfway true at this point. We'll see. Does anyone think all that construction going on now is to serve less than the 52 mil or so guesstimated to attend each year? So wait times and fastpass are better?

...Shirley, ye jest...

Okay.

 

[wdisney9000]

There's no secret here...and you don't have to be a Director of Wharton Business School to figure it out either...

It's taken about 20 years...starting with exposure behind a name tag...to see the whole endgame. Lots of reading, and healthy skepticism.

As far as "categorical liar"...blind squirrels do find the nuts occasionally.

What's going on with attendance/pricing?

...if I may...

1.
Company states that they are increasing price to reduce attendance, ensure luxury...

Subliminal: "you upper crust middle classes will be elite and not deal with the six flags riff raff...like you've always wanted to feel"

2. Company vastly increases prices rapidly to soften stances on value/expectation.

...that's been going on for a decade

3. Once price expectation starts being driven upward at frantic pace, increase capex and infrastructure to flood 20% more on property and increase profit level outright.

...in this case, company expects that "softened" clientele will continue to pay the price and deal with bigger crowds due to the Branding attachment as opposed to rejecting it.

End of the day: they are statistically correct and can squeeze more wine from the largely used grapes.

But is my "theory"...it's only halfway true at this point. We'll see. Does anyone think all that construction going on now is to serve less than the 52 mil or so guesstimated to attend each year? So wait times and fastpass are better?

...Shirley, ye jest...

For all the possible reasons of any and all price hikes at WDW, the one constant is that PEOPLE CONTINUE TO VISIT regardless. I am sure there are all sorts of fancy financial metrics and algorithms that a simpleton like myself will not understand, but in the end...people keep visiting. Cant blame them for raising prices.

 

[HauntedPirate]

...is there anybody out there that honestly believes that for a second?

Oh, I have no doubt they want lower attendance and (much) higher prices. Lower attendance = fewer CMs needed. Fewer CMs needed = lower costs. Higher ticket prices = higher profit. Higher profit and lower costs = higher margins. Higher margins = happy stock analysts.

 

[beachlover4444]

We've been 5 times in the last 4 years. Now that we're in SC its only an 8 hr drive. But Even though the grandkids are 2 and 4 I will tell you that if the prices keep increasing we will not be able to afford to go. We were going to do AP this year and decided to wait a year and I've worried with Toy Story land and Star wars land and the anniversary coming that the next few years were going to be bonkers. We were gonna stay away due to crowds but now price may also be the reason we stay away and head to Tennessee to their parks instead.

 

[Brad Bishop]

Disney is in a unique position where, for the most part, as to build something similar is a big undertaking compared to what it was in the 1960s/1970s (and it was a big undertaking then).

Now, though, you have:
- OSHA
- EPA
- lawsuits
- protests
- labour is more expensive with the health insurance requirements, etc.
- etc.

That really make it tough for some company to come in, buy a bunch of property, and setup a new, competing theme park. Comcast/Universal can do it but it's going to cost them more build one today than it did 20-50 years back, even accounting for inflation.

Add to it that the population keeps growing and you end up with more and more people who want to go, even on the higher end of the payscale just due to the overall population growth, and a limitation on theme park availability. Only so many people can visit the MK, Epcot, DAK, DHS, IoA, and USF in a day.

For them, it works out quite well. It's like controlling the best steak houses in town and the cost of entry in the market is so incredibly high and your product is so sought after that you can kind of do whatever you like - as long as you keep the quality up.

 

[Sirwalterraleigh]

Oh, I have no doubt they want lower attendance and (much) higher prices. Lower attendance = fewer CMs needed. Fewer CMs needed = lower costs. Higher ticket prices = higher profit. Higher profit and lower costs = higher margins. Higher margins = happy stock analysts.

What If they want BOTH?

Charging 150/175/200 is well above the threshold of covering employees...their employees aren't exaclty rocket scientists...

That's another thing that gets lost in these debates: gate is meant to generate profit now when it was always to cover operational costs prior

 

[Sirwalterraleigh]

For all the possible reasons of any and all price hikes at WDW, the one constant is that PEOPLE CONTINUE TO VISIT regardless. I am sure there are all sorts of fancy financial metrics and algorithms that a simpleton like myself will not understand, but in the end...people keep visiting. Cant blame them for raising prices.

I agree...power is with the consumer and they have to know how to use it.

Just to be clear for all my comments: to comment is not to condemn. I throw things out to be discussed.

 

[WhatJaneSays]

I dug out and updated the spreadsheet I made last year tracking the 1 day ticket increases.

Do with it as you will. Sorry it's a bit tiny.

 

[Sirwalterraleigh]

I dug out and updated the spreadsheet I made last year tracking the 1 day ticket increases.

Do with it as you will. Sorry it's a bit tiny.

The important thing missing from that chart is that Robert A. Iger took over on 10/01/2004...

Now look at the data again. Past managers always proceeded with increases with caution - valuing a core clientele.

This guy is more like tim Robbins from Austin powers: "let me launch just one nuke...I've got them out the ying yang"

 

[aladdin2007]

My pass expires in March I believe, but I cant renew it say next week etc its too early right?