A lower attendance future for WDW?

[havoc315]

Sure, that might push them to Florida in March. It's not going to push them to Florida in October. If they're going in October, it's for other reasons.

I'll only speak for myself -- Due solely to weather, I'd rather be in Orlando in October than July-August.

 

[uncle jimmy]

I was struck by the recent article about the possibility of an Epcot hotel:

"an in-park EPCOT boutique hotel may well fit in with Disney's post-COVID plans for lower attendance, offset with higher spending guests."

And it made me consider whether this is part of the soft-reset we are seeing during this Covid re-opening transition. It would seem counter-intuitive at first -- Why would you ever intentionally work towards lower attendance?
Sure, higher spending per guest makes sense -- but wouldn't you want ever increasing attendance AND ever increasing guest spending?

But then I thought about trends over the last 30 years. From the 1960's-1980's, sports stadiums kept getting bigger and bigger, the goal of sustaining bigger and bigger crowds. But then something happened with the newer generation of stadiums: Starting with Camden Yards in 1992, they starting going retro with the stadiums. Smaller more intimate stadiums started replacing the mega stadiums. Charge more per ticket, offer more luxury boxes, more premium seating, but cut back on the "cheap seats." Here in New York, 42,000 seat Citi Field replaced 45,000 seat Shea Stadium. Old Yankee Stadium could set 57,000, the newer stadium only 54,000.
Movie theaters have seen this trend on an even greater degree -- I grew up in the 80's, the era of the mega plex... bigger and bigger screens, with as many seats crammed in as possible.
But now, movie theaters have moved towards more luxurious seating - wide reclining seats, far lower capacity per theater.

In the end, WDW theme park guest capacity hasn't changed much in the last 20 years. In fact, many of the best and newest attractions have lower capacity than the attractions they replaced.

Some of Disney's actions suggest they may be perfectly happy accepting lower attendance, to the extent it allows them to increase guest spending. For example, the announced Early Theme Park Entry: In the old days of EMH, off-site guests could still get equal footing with onsite guests for rope drop, except at that morning's EMH park. Now, off-site guests will have a major rope drop disadvantage at all parks. Might that reduce off-site guests?
Off-site guests are FAR less profitable to Disney than on-site guests, not even close.

Similarly, lower attendance --> reduced lines --> greater guest satisfaction --> can charge more.

But like in the 80's, movie theaters were getting bigger and adding more seats, Disney in the 90's was building up "value" hotel capacity. Now, they are building an ultra expensive Starcruiser hotel. And according to this rumor, what would be an expensive boutique Epcot hotel.

With the slow return of entertainment, some of which appears gone forever. Slow return of APs. etc. Is Disney transitioning to a lower attendance future?

I think it will be easier to justify lower crowd levels in WDW parks compared to down the road at Uni.
The reality will be that Universal is setting up to become the 5-7 day vacation spot and WDW is becoming a 2-3 day stay.

 

[CaptainAmerica]

I'll only speak for myself -- Due solely to weather, I'd rather be in Orlando in October than July-August.

I think we're all overthinking it. The number one driver is still school, which means summer would be de facto high demand, so Disney cut prices and offered promotions and special events in the Fall, which people got accustomed to. They over-corrected.

 

[UNCgolf]

Some of you have obviously never lived in Florida. Spoiler alert: It's still hot as hell in Florida in October, too. The weather argument is bunk to me.

Summer: Crappy and hot in the Northeast, really crappy and really hot in Florida.
October: Gorgeous in the Northeast, still crappy and hot in Florida.

"It's the weather" might be legit if we were talking about July versus March, but between July versus October it's not a major driver.

Temperatures are more or less relative, though. I know someone who lives in south Florida and to him anything below 65 degrees is miserable. Also know someone who lives north of Toronto who thinks a 45 degree sunny day is beautiful warm weather and anything above 75 is just too hot to be outside. I personally would like it to be in the high 70s or low 80s year round.

 

[Lilofan]

I'll only speak for myself -- Due solely to weather, I'd rather be in Orlando in October than July-August.

I miss Club Cool at Epcot. It is a break from the heat and as all you can drink soda from all over the world served in little cups.

 

[brettf22]

More like Mickey's Vomit in the Trash Can Outside Pecos Bill's Because You Went to Biergarten and Had a Liter of Beer and Lukewarm Sausage Last Night and Also It's 103 Degrees So You Have Heat Stroke and Food Poisoning at the Same Time Party.

Not that I would know.....

Ah yes, the ol' MVTCOPBBYWBHLBLSLNAODSYHHSFPSTP. Sells out every year.

 

[Sirwalterraleigh]

I think it will be easier to justify lower crowd levels in WDW parks compared to down the road at Uni.
The reality will be that Universal is setting up to become the 5-7 day vacation spot and WDW is becoming a 2-3 day stay.

...Well here’s an opinion you don’t see everyday

 

[CaptainAmerica]

...Well here’s an opinion you don’t see everyday

That is... indeed a take one can have, I suppose.

 

[Sirwalterraleigh]

That is... indeed a take one can have, I suppose.

..:usually right before the board tears them apart like a pack of timber wolves on a wounded lamb

 

[havoc315]

I think we're all overthinking it. The number one driver is still school, which means summer would be de facto high demand, so Disney cut prices and offered promotions and special events in the Fall, which people got accustomed to. They over-corrected.

Maybe in part. But I think a big part is just a change in how people vacation.

Go back 50-60 years, Howard Johnsons was a massive successful operation, catering to all those that drove on their vacations. By the 80-90's, HOJO was struggling, with fewer people driving to their vacations, the demand for the roadside motel was disappearing. By then, more and more family vacationers were flying -- primarily to domestic locations... and WDW was THE domestic location for families. Cruises were primarily for retirees. Europe was for the rich. And no other theme parks could hold a candle to WDW and DL.
From 2000 to present, we have seen growth in additional theme parks, growth in family cruising, growth in family international travel.

So I think a big part of the change is simply the evolution of how Americans vacation.

 

[larryz]

We are talking cupcake martinis!

FTFY

 

[uncle jimmy]

..:usually right before the board tears them apart like a pack of timber wolves on a wounded lamb

Rather than spending billions on a new land (or ride), how about spend millions on a hotel and change the way people visit Walt Disney World, they can see old things they never saw which will be new to them.

 

[Sirwalterraleigh]

Maybe in part. But I think a big part is just a change in how people vacation.

Go back 50-60 years, Howard Johnsons was a massive successful operation, catering to all those that drove on their vacations. By the 80-90's, HOJO was struggling, with fewer people driving to their vacations, the demand for the roadside motel was disappearing. By then, more and more family vacationers were flying -- primarily to domestic locations... and WDW was THE domestic location for families. Cruises were primarily for retirees. Europe was for the rich. And no other theme parks could hold a candle to WDW and DL.
From 2000 to present, we have seen growth in additional theme parks, growth in family cruising, growth in family international travel.

So I think a big part of the change is simply the evolution of how Americans vacation.

Very much the case.

I think with Disney parks part of what they are dealing with is the public pressures on conglomerates.

Disney parks don’t provide the value they once did. Really since Roy gave Eisner the boot.

They used to provide, consistent, impressive profits from parks while still providing exceptional overall value. But that’s not good enough for bigtime. So they have to take chances with the value of their product for immediate payouts.

Their pricing structure doesn’t provide that kind of a level of value anymore and they’ve lost many potential travelers due to that “phantom menace”.

I know people say “I think it’s great value!! What place is better?!?”...but that is wrong if you compare it to price indexes. It’s far out of whack now. Mostly from no
adjustment during the Great Recession.

Many choose not to go for a reason...and this is the reason...but can’t put a face on it. They are casual and don’t dive into the weeds like a diehard does.

 

[Heppenheimer]

Temperatures are more or less relative, though. I know someone who lives in south Florida and to him anything below 65 degrees is miserable. Also know someone who lives north of Toronto who thinks a 45 degree sunny day is beautiful warm weather and anything above 75 is just too hot to be outside. I personally would like it to be in the high 70s or low 80s year round.

I've seen the shorts and T-shirts come out in the mid 30s in Ontario.

 

[UNCgolf]

I've seen the shorts and T-shirts come out in the mid 30s in Ontario.

Indeed. And my friend from south Florida is bundled up in a coat if it's 62.

 

[havoc315]

True...but the last part is a paradox

High earners don’t buy more trinkets. Nor do they find it cute to start collections of mouse ears or purses with cartoon characters on them

But they buy the $500 designer Disney purse. They spring for Victoria and Alberts, not just Chef Mickey's.

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. Offer the $800 hotel room and the $150 hotel room. But sometimes there does come a point where offering the cheaper makes it harder to sell the more expensive. So there sometimes comes a time to reduce the cheaper options.
For example -- If you only had 2 choices of hotel rooms, $500 or $100... There will be some people who can afford the $500 but decide to save money and take the $100. If you eliminated the $100 option, some of those people would switch to the $500, while others would simply skip it altogether.
And part of that is driving expectations as well.... A fine line where you don't want to scare off guests, but you may also want them to come to WDW with higher spending expectations. (Come to Disney with an expectation for luxurious overpriced $500 dinner, not with expectation for an overpriced $20 hamburger).

 

[davis_unoxx]

bring back long park hours please!

 

[Sirwalterraleigh]

But they buy the $500 designer Disney purse. They spring for Victoria and Alberts, not just Chef Mickey's.

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. Offer the $800 hotel room and the $150 hotel room. But sometimes there does come a point where offering the cheaper makes it harder to sell the more expensive. So there sometimes comes a time to reduce the cheaper options.
For example -- If you only had 2 choices of hotel rooms, $500 or $100... There will be some people who can afford the $500 but decide to save money and take the $100. If you eliminated the $100 option, some of those people would switch to the $500, while others would simply skip it altogether.
And part of that is driving expectations as well.... A fine line where you don't want to scare off guests, but you may also want them to come to WDW with higher spending expectations. (Come to Disney with an expectation for luxurious overpriced $500 dinner, not with expectation for an overpriced $20 hamburger).

Respectfully, you’re talking about the past. The range is not as broad as this anymore due to choices made.

Where is an on property room $150 these days?
You can barely get a moderate for less than $250...

And we can respectfully disagree on what “luxury” items are offered. Again...you don’t see lady and the tramp Dooney’s at the lawn club or the pharma Christmas party.

But I’d like to live where you do...it sounds fun and happy

 

[Sirwalterraleigh]

bring back long park hours please!

Why? People will pay double for them.

 

[bcoachable]

I was struck by the recent article about the possibility of an Epcot hotel:

"an in-park EPCOT boutique hotel may well fit in with Disney's post-COVID plans for lower attendance, offset with higher spending guests."

And it made me consider whether this is part of the soft-reset we are seeing during this Covid re-opening transition. It would seem counter-intuitive at first -- Why would you ever intentionally work towards lower attendance?
Sure, higher spending per guest makes sense -- but wouldn't you want ever increasing attendance AND ever increasing guest spending?

But then I thought about trends over the last 30 years. From the 1960's-1980's, sports stadiums kept getting bigger and bigger, the goal of sustaining bigger and bigger crowds. But then something happened with the newer generation of stadiums: Starting with Camden Yards in 1992, they starting going retro with the stadiums. Smaller more intimate stadiums started replacing the mega stadiums. Charge more per ticket, offer more luxury boxes, more premium seating, but cut back on the "cheap seats." Here in New York, 42,000 seat Citi Field replaced 45,000 seat Shea Stadium. Old Yankee Stadium could set 57,000, the newer stadium only 54,000.
Movie theaters have seen this trend on an even greater degree -- I grew up in the 80's, the era of the mega plex... bigger and bigger screens, with as many seats crammed in as possible.
But now, movie theaters have moved towards more luxurious seating - wide reclining seats, far lower capacity per theater.

In the end, WDW theme park guest capacity hasn't changed much in the last 20 years. In fact, many of the best and newest attractions have lower capacity than the attractions they replaced.

Some of Disney's actions suggest they may be perfectly happy accepting lower attendance, to the extent it allows them to increase guest spending. For example, the announced Early Theme Park Entry: In the old days of EMH, off-site guests could still get equal footing with onsite guests for rope drop, except at that morning's EMH park. Now, off-site guests will have a major rope drop disadvantage at all parks. Might that reduce off-site guests?
Off-site guests are FAR less profitable to Disney than on-site guests, not even close.

Similarly, lower attendance --> reduced lines --> greater guest satisfaction --> can charge more.

But like in the 80's, movie theaters were getting bigger and adding more seats, Disney in the 90's was building up "value" hotel capacity. Now, they are building an ultra expensive Starcruiser hotel. And according to this rumor, what would be an expensive boutique Epcot hotel.

With the slow return of entertainment, some of which appears gone forever. Slow return of APs. etc. Is Disney transitioning to a lower attendance future?

Well thought out and written. Thanks for taking the time to bring this up. I am looking forward to reading the reactions...