A lower attendance future for WDW?

[SteveAZee]

Many of those homes are owned by Fortune 500 companies, include Apple, Coke, Walmart, as performance incentives.

That's interesting... I didn't know that. I remember some rules about not being allowed to rent or AirBnB the places once bought, but I suppose if a corporation buys them and allows key employees to stay there for free as incentive it's... different?

Do you have source for this? I'm really curious.

 

[MurphyJoe]

So limit it to on-site deluxe, and not make it available for separate purchase. Remember, UNI sells UE to day guests as well.

If we assume an 80% occupancy rate with three people per room, that's 23,962 people who would have access; or 5,990 per park if people are evenly spread out. Hourly attraction capacity estimates can be seen here: https://forums.wdwmagic.com/threads/attractions-people-per-hour-and-other-stats.939105/ . Going with the "Operational Hourly Ride Capacity (OHRC)" column where available, giving every Deluxe resort guest (with the occupancy assumption above) a single entrance to every previous FP+ attraction means 3 to 5 hours per attraction every day which would be reserved for Deluxe resort guests. Thus, depending on the park and the day, Deluxe guests would potentially have half of a park's operating attraction hours. I can't imagine Disney willing to provide that sort of benefit when the rooms are already selling themselves and the prices they could command for an all access pass (or even just getting people paying $10/day as a ticketing add-on for Max Pass type benefits).

 

[matt9112]

So? Are you saying that Disney is going to cut their prices so that people won't be tempted to live beyond their means?
Not sure what you're suggesting?

Disney is perfectly happy for you to live beyond your means. And they are happy to raise their prices by 5% and push people to live 5% even higher above their means.

Again, what does any of that have to do with whether Disney will keep trying to raise their prices and reduce the benefits of those who are low spenders?

No im just saying its not "wealthy" guests there inherently after. Im nit arguing there strategy. Nor am i arguing ite effectiveness. However i am saying i think the price ceiling where it becomes more than people want to pay COUPLED with a reduction in quality is lower than some think. The cult of the parks is a good insulator but even that can be damaged.

My overarching point is that i do not think long term the current strategy is a good one. In order to sacrifice volume of sales (in this case guest attendance) you usually need to be a high quality product. The value or more so reflective value of the product to me is decreasing. I do not feel i am alone in this thought. Its just a case of if and when will regular guests also see that. They want to maximize PGS without actually putting effort into it. Granted people keep coming so obviously im just a nut case.

 

[havoc315]

If we assume an 80% occupancy rate with three people per room, that's 23,962 people who would have access; or 5,990 per park if people are evenly spread out. Hourly attraction capacity estimates can be seen here: https://forums.wdwmagic.com/threads/attractions-people-per-hour-and-other-stats.939105/ . Going with the "Operational Hourly Ride Capacity (OHRC)" column where available, giving every Deluxe resort guest (with the occupancy assumption above) a single entrance to every previous FP+ attraction means 3 to 5 hours per attraction every day which would be reserved for Deluxe resort guests. Thus, depending on the park and the day, Deluxe guests would potentially have half of a park's operating attraction hours. I can't imagine Disney willing to provide that sort of benefit when the rooms are already selling themselves and the prices they could command for an all access pass (or even just getting people paying $10/day as a ticketing add-on for Max Pass type benefits).

Math seems wonky but I’ll take it as true for the sake of argument.

But you missed a critical point: the rooms don’t sell themselves at the rate Disney wants. Which is why they constantly offer 30%+ discounts. That’s why they have converted low-demand deluxe space into DVC.
A big perk like an Express pass just for deluxe guests would allow Disney to charge a higher rate and her higher occupancy.
Imagine they currently profit $200 per deluxe room. So 8000 rooms booked at $200 profit, or 9000 rooms at $275 profit?
Under this set of assumptions, it’s an extra profit of $320 million per year.
If you go from 8000 rooms at $200 profit to 9500 rooms at $300 profit..then it’s an extra annual profit of $450 million.

 

[havoc315]

No im just saying its not "wealthy" guests there inherently after. Im nit arguing there strategy. Nor am i arguing ite effectiveness. However i am saying i think the price ceiling where it becomes more than people want to pay COUPLED with a reduction in quality is lower than some think. The cult of the parks is a good insulator but even that can be damaged.

My overarching point is that i do not think long term the current strategy is a good one. In order to sacrifice volume of sales (in this case guest attendance) you usually need to be a high quality product. The value or more so reflective value of the product to me is decreasing. I do not feel i am alone in this thought. Its just a case of if and when will regular guests also see that. They want to maximize PGS without actually putting effort into it. Granted people keep coming so obviously im just a nut case.

Lol. No, not a nut case. But yes, people are still coming.

But here is the question: is the value of the product decreasing for those willing to spend the money?
If they reduce regular hours but add a lower attendance after-hour party — that improves the product for the person willing to buy both tickets.
If they were to eliminate “free FP” and replace it with a paid option (or included in cost of deluxe, so up-charge built into the room), that would improve the product for the person willing to pay.
If they remove free entertainment but offer higher quality paid entertainment like cirque du soleil, again it’s an overall improved product for those willing to pay.

They are decreasing the value in just a regular day ticket but increasing the potential value for people to spend more.

 

[Jrb1979]

Lol. No, not a nut case. But yes, people are still coming.

But here is the question: is the value of the product decreasing for those willing to spend the money?
If they reduce regular hours but add a lower attendance after-hour party — that improves the product for the person willing to buy both tickets.
If they were to eliminate “free FP” and replace it with a paid option (or included in cost of deluxe, so up-charge built into the room), that would improve the product for the person willing to pay.
If they remove free entertainment but offer higher quality paid entertainment like cirque du soleil, again it’s an overall improved product for those willing to pay.

They are decreasing the value in just a regular day ticket but increasing the potential value for people to spend more.

I agree with you. The worst part of it is how many Disney fans defend them doing this. Look at those who defended them getting rid of Magical Express

 

[Sir_Cliff]

Lol. No, not a nut case. But yes, people are still coming.

But here is the question: is the value of the product decreasing for those willing to spend the money?
If they reduce regular hours but add a lower attendance after-hour party — that improves the product for the person willing to buy both tickets.
If they were to eliminate “free FP” and replace it with a paid option (or included in cost of deluxe, so up-charge built into the room), that would improve the product for the person willing to pay.
If they remove free entertainment but offer higher quality paid entertainment like cirque du soleil, again it’s an overall improved product for those willing to pay.

They are decreasing the value in just a regular day ticket but increasing the potential value for people to spend more.

At the end of the day, WDW is going to remain a mass tourist destination. They're still going to want well upwards of 100,000 people streaming through their turnstiles every single day of the year. One thing you're not taking into account with all this discussion is how much good will Disney is destroying in the process. Some people will go whatever Disney does, even if it means cutting costs elsewhere, putting up with a diminished experience, or going into debt. They should be paying attention, though, to how almost betrayed a lot of their customers feel when things like DME or the APs are taken away.

They are in the hospitality business and pitching themselves as a resort. Shifting that pitch from "look at all the amazing perks you get staying a Disney Resort Hotel!" to "Look at all the amazing things you can pay extra for when you stay at a Disney Resort Hotel!" isn't very compelling. Disney is betting their product is compelling enough that they can get away with it without turning off too many of those big numbers of guests they depend on, but I have my doubts.

I'm among those on here who isn't feeling priced out by Disney and probably won't be. I also don't like being obviously treated like a fool who will pay more for a lesser experience and throw money at them to try and make up the difference.

 

[havoc315]

I agree with you. The worst part of it is how many Disney fans defend them doing this. Look at those who defended them getting rid of Magical Express

I’m neither defending it nor criticizing it. It’s merely observation of what they are doing.

 

[havoc315]

At the end of the day, WDW is going to remain a mass tourist destination. They're still going to want well upwards of 100,000 people streaming through their turnstiles every single day of the year. One thing you're not taking into account with all this discussion is how much good will Disney is destroying in the process. Some people will go whatever Disney does, even if it means cutting costs elsewhere, putting up with a diminished experience, or going into debt. They should be paying attention, though, to how almost betrayed a lot of their customers feel when things like DME or the APs are taken away.

They are in the hospitality business and pitching themselves as a resort. Shifting that pitch from "look at all the amazing perks you get staying a Disney Resort Hotel!" to "Look at all the amazing things you can pay extra for when you stay at a Disney Resort Hotel!" isn't very compelling. Disney is betting their product is compelling enough that they can get away with it without turning off too many of those big numbers of guests they depend on, but I have my doubts.

I'm among those on here who isn't feeling priced out by Disney and probably won't be. I also don't like being obviously treated like a fool who will pay more for a lesser experience and throw money at them to try and make up the difference.

You’re talking as if anything I’m talking about is new for Disney. The stuff you’re criticizing has already been an ongoing trend of the last 30 years if not more.

Opening day ticket to WDW was $3.50, about $20 today with inflation. They managed to get away with astronomical increases to this pricing. They managed to get away with charging tons extra for the privilege of bouncing between parks. They managed to charge astronomical rates for on-site stays and dining. $200 a night for brightly colored motel-level accommodations? $600+ for a regular-hotel, maybe with a little theming. $26 for generic chicken parm?
They already managed to get away with reduction in seasonal night hours and add paid parties.

So this argument that they “won’t get away it increasing prices” ignores the fact that they have been getting away with it for decades. Yet, they still have very strong demand.
The only shift I see... they don’t care if they lose a few thousand off-site low spending guests.

 

[Sir_Cliff]

You’re talking as if anything I’m talking about is new for Disney. The stuff you’re criticizing has already been an ongoing trend of the last 30 years if not more.

Opening day ticket to WDW was $3.50, about $20 today with inflation. They managed to get away with astronomical increases to this pricing. They managed to get away with charging tons extra for the privilege of bouncing between parks. They managed to charge astronomical rates for on-site stays and dining. $200 a night for brightly colored motel-level accommodations? $600+ for a regular-hotel, maybe with a little theming. $26 for generic chicken parm?
They already managed to get away with reduction in seasonal night hours and add paid parties.

So this argument that they “won’t get away it increasing prices” ignores the fact that they have been getting away with it for decades. Yet, they still have very strong demand.
The only shift I see... they don’t care if they lose a few thousand off-site low spending guests.

I'm having a hard time keeping track of the point you were making with this thread. If it was that they're going to keep raising prices like they always have with the only potential difference being they're more willing going forward to lose a few thousand off-site, low-spending guests... well, ok.

 

[UNCgolf]

So this argument that they “won’t get away it increasing prices” ignores the fact that they have been getting away with it for decades. Yet, they still have very strong demand.
The only shift I see... they don’t care if they lose a few thousand off-site low spending guests.

The issue with this is that for most of that time period, the increase in price at the very least didn't involve a decrease in what you received for it and sometimes actually involved getting more.

That doesn't appear to be the case going forward (adding parking fees to the resorts, the dramatic increase in upcharge events, etc.). There's a pretty big difference between charging someone $150 for what they used to get for $125, and charging someone $150 dollars for less than what they used to get for $125.

If they keep devaluing the standard experience while charging more money for it, it becomes far more difficult to justify paying the increased price.

 

[TrainsOfDisney]

When did WDW stop expanding the parks?

At Disneyland they continue to add attractions. Star Wars Land was an addition, Mickey’s Runaway is an addition, midway mania was an addition. At WDW all 3 of these were replacements.

 

[havoc315]

I'm having a hard time keeping track of the point you were making with this thread. If it was that they're going to keep raising prices like they always have with the only potential difference being they're more willing going forward to lose a few thousand off-site, low-spending guests... well, ok.

That's EXACTLY my point.
In the past -- They kept raising their prices, but still tried to simultaneously maximize attendance
In the future -- They will keep raising prices, but they don't care if they lose a few thousand lower paying guests, they don't care if attendance is lower.
That's why I kept objecting to your term "luxury" -- as that was always irrelevant to my argument.

 

[havoc315]

The issue with this is that for most of that time period, the increase in price at the very least didn't involve a decrease in what you received for it and sometimes actually involved getting more.

That doesn't appear to be the case going forward (adding parking fees to the resorts, the dramatic increase in upcharge events, etc.). There's a pretty big difference between charging someone $150 for what they used to get for $125, and charging someone $150 dollars for less than what they used to get for $125.

If they keep devaluing the standard experience while charging more money for it, it becomes far more difficult to justify paying the increased price.

I get what you mean. But Disney isn't necessarily "decreasing what you receive" -- for the most part, they are just making you pay more for it, but they are also slicing up the pricing.
Instead of a park ticket that can take you from 8 am to 10 pm... You can buy "Extra Morning Magic" from 7:45am - 9:00 am, the "regular ticket" for 9-6, and the party that goes from 6pm - 11 pm.

So you're not "getting less" -- You're actually getting more... if you are willing to pay separately for each of these pieces.

And this isn't a very new trend for WDW. Expansion of parties and paid events has been going on for several years. Reduction of EMH has been going on for several years.
10 years ago, the dining plan included appetizer and tip. While more than doubling the price, they have cut out these inclusions and substitutes less costly elements (resort unlimited soda cup, alcohol).
You mentioned the elimination of free parking.

So "less included in base price" isn't new. Though the pace of the change may be increasing. You are correct in the sense "receive less for base price"... but WDW is indeed expanding way to 'receive far more.. but be prepared to pay far more than base price."

And getting back to my original hypothesis -- Yes, this makes it more difficult to pay the increased base price. But that's it, WDW doesn't care so much if they lose some "base price" guests, if they are getting additional "upcharge" guests.

It's fair to say that 1 "deluxe resort on-site free spending family" is more profitable to Disney than 5-10 "off site budget guests."

 

[uncle jimmy]

When did WDW stop expanding the parks?

At Disneyland they continue to add attractions. Star Wars Land was an addition, Mickey’s Runaway is an addition, midway mania was an addition. At WDW all 3 of these were replacements.

New Fantasy land at MK is my thought.
Thou Rat & tron are an addition, yes when WDW could've added SWL, MMR & TSMM they instead replaced something.

When will WDW give expansions to their parks instead of replacements?

 

[TrainsOfDisney]

New Fantasy land at MK is my thought.
Thou Rat & tron are an addition, yes when WDW could've added SWL, MMR & TSMM they instead replaced something.

When will WDW give expansions to their parks instead of replacements?

Fantasyland traded subs for mine train and seven dwarves for little mermaid. No additional attractions unless you count storytime with belle.

I still believe Tron is intended to be a replacement for Space.

 

[uncle jimmy]

Fantasyland traded subs for mine train and seven dwarves for little mermaid. No additional attractions unless you count storytime with belle.

I still believe Tron is intended to be a replacement for Space.

Right right... Also lost Snow White scary ride for Princess Hall of Meet-n-greets.

I think it's intended to fill a void while they do a refub of Space. Which I think will be more of a replacement of tracks similar to Paris style

 

[Sir_Cliff]

That's EXACTLY my point.
In the past -- They kept raising their prices, but still tried to simultaneously maximize attendance
In the future -- They will keep raising prices, but they don't care if they lose a few thousand lower paying guests, they don't care if attendance is lower.
That's why I kept objecting to your term "luxury" -- as that was always irrelevant to my argument.

I think you brought up luxurious $500 meals and the like. That's where we got into the weeds about Disney charging deluxe prices for experiences that aren't actually what would be considered deluxe elsewhere and whether that works as a longterm business strategy.

At any rate, sure, I agree that Disney would like to control attendance growth if not bring attendance down a little while getting those that do come to pay more. I think almost all of us here agree on that. Whether they can do that or are going about it the right way is the open question.

 

[havoc315]

I think you brought up luxurious $500 meals and the like. That's where we got into the weeds about Disney charging deluxe prices for experiences that aren't actually what would be considered deluxe elsewhere and whether that works as a longterm business strategy.

we did get off on a tangent. -- a $500 meal is easily a family of 4 at California Grill if you include a couple appetizers, a bottle of wine, tax and tip. And yes, Disney wants to emphasize that family, as opposed to those who bring a bagged meal of peanut butter and jelly.
I went back and found the post you mentioned... I said they want more people to expect an "overpriced luxurious $500 meal" -- And I believe that was the only time I used the word luxurious (probably not the best choice of words.. Even outside of Disney, a $500 family meal may be on the expensive side, but it's not "luxury).
But my point was clear, in the same post I wrote:

To the extent possible, Disney has always and will always continue to provide opportunities for price discrimination. Offer the $300 per person dinner as well as the $10 per person meal.

But I continue to maintain, Disney wants more of the California Grill diners, and they don't care if they lose a handful of Casey's hotdog diners.

At any rate, sure, I agree that Disney would like to control attendance growth if not bring attendance down a little while getting those that do come to pay more. I think almost all of us here agree on that. Whether they can do that or are going about it the right way is the open question.

I completely totally agree with you. I think they've come to the conclusion that maximizing attendance at all costs isn't the optimum strategy. I think part of what they are doing during this Covid period, they are re-evaluating how they can maximize profit at a lower attendance. No... 35% won't be forever. But they may take a break from ever-growing attendance.

 

[UNCgolf]

When did WDW stop expanding the parks?

At Disneyland they continue to add attractions. Star Wars Land was an addition, Mickey’s Runaway is an addition, midway mania was an addition. At WDW all 3 of these were replacements.

The only actual additions I can think of this century are Expedition Everest, Tron, and Ratatouille. That's off the top of my head, though, and I wouldn't be surprised if I'm forgetting something. Everything else was some sort of replacement rather than a completely new build in a previously unused area.

To be fair, some of them were replacements for areas that no longer served a purpose. Although I think the original Backlot Studio Tour was 1000x better than anything in Toy Story Land, that whole area was essentially obsolete once they stopped using the studios for actual animation and filming. I also don't think anyone wishes Camp Minnie-Mickey was still there instead of Pandora.