A lower attendance future for WDW?

[TrainsOfDisney]

From a food and beverage perspective a location maximizing revenue depends on guest traffic non stop to buy the overpriced burger and fries in a fast food location and or turn as many tables over in a location that is a sit down waiter service. I'm not sold one can do that with " limited attendance " mindset. Merchandise sales depends on the high guest traffic ( ie higher attendance ) . That being said I'm not sold on " limited attendance ". Charging $20-40 per car to park at Epcot with limited attendance? Having an attendance of 60K on NYE and multiply that per guest car and now we are talking of more revenue to satisfy WDW. WDW is not a boutique place and never will be.

The food and beverage locations that are still open always have a line. There is a magic number where profits can be higher.

I’m not saying this is what Disney should be doing... but now that they have a reason to test this they will.

 

[Sirwalterraleigh]

You keep saying luxury. I have not. Ive said they want to concentrate on higher spending guests. The guests that ALREADY go to Disney.

And yes— they are above median earners. Which by definition— puts them ABOVE the middle.

You seem to include “middle” class as 99.5% of Americans. So sure... I agree that 99% of the guests at Disney come from the bottom 99.5% of earners. But so what??

I don’t care what word you use to describe a family in the top 10% of earners at $200,00... I don’t care if you want to call that family “rich” or “affluent” or “upper middle class” or “middle class.”

But that’s the family that spends $10,000 on an annual Disney vacation.
and Disney wants to focus more on that family— get them to increase the $10,000 to $12,000.. add a few more similar families. And they don’t care if they lose some of the families that only spend $800 on a Disney vacation. (Off-site, bagged lunches, so only money spent on Disney is tickets)
Because a family that spends $12,000 is 15 times more profitable than a family that spends $800.
Thus... if they can attract just 1 more $12,000 family at the cost of losing 5 $800 families, that’s a net win for Disney. It’s a huge net win.
If they can get a $12,000 family to spend $13,000 instead— that’s a net win, even if they lose a $800 family.

There’s a reason why I keep using “luxury”. And it’s not what you or I said. But it’s the whole point to this idea.

who used it?

 

[Lilofan]

They have had problems finding labor to increase the staff since the 90’s...definitely since DAK.

sure you can hire enough and flood the place with college kids...but you can’t retain enough to not lose a lot of efficiency and overhead costs.

Anyone remember the " incentive" money to lure people to apply and get hired to work at Disney?
Culinary - $500 bonus
Housekeeping - $250 bonus
The list goes on and on...

 

[havoc315]

There’s a reason why I keep using “luxury”. And it’s not what you or I said. But it’s the whole point to this idea.

who used it?

No, it’s not the point. Focusing more on higher spenders doesn’t mean focusing on caviar and billionaires.
It means focusing more on people who spend $10,000 at Disney (I don’t care if you call that middle class, rich, or anything else) and less on people who spend $800. (Don’t care whether you call these people middle class or something else)

“luxury” is irrelevant to this discussion.

 

[DavidNoble]

They have had problems finding labor to increase the staff since the 90’s...definitely since DAK.

sure you can hire enough and flood the place with college kids...but you can’t retain enough to not lose a lot of efficiency and overhead costs.

So would it be fair that the real issue is turnover?

 

[Sirwalterraleigh]

So would it be fair that the real issue is turnover?

it’s complicated.

the thing about 60,000 employees is that most are minimum paid/skilled entry level with no hope of advancement...but they have to be full time.

that’s rare. Where else to you need that kinda workforce on one plot of real estate?

the point is if they needed 70,000...it would be hard to sustain/maintain...not without much higher premiums that won’t be tolerated.

once phase 3 was complete...DAK area...labor became a real concern that doesn’t get much attention.

 

[TrainsOfDisney]

the thing about 60,000 employees is that most are minimum paid/skilled entry level with no hope of advancement...but they have to be full time.

This seems a bit extreme. Like I get what you are saying but I’ve met many higher ups at Disney (wdw management and lower imagineer level..) who started out at the bottom and worked their way up and in pretty short time.

So it’s certainly possible to advance. That doesn’t mean the majority do, and that’s probably your point but still worth mentioning.

 

[Lilofan]

it’s complicated.

the thing about 60,000 employees is that most are minimum paid/skilled entry level with no hope of advancement...but they have to be full time.

that’s rare. Where else to you need that kinda workforce on one plot of real estate?

the point is if they needed 70,000...it would be hard to sustain/maintain...not without much higher premiums that won’t be tolerated.

once phase 3 was complete...DAK area...labor became a real concern that doesn’t get much attention.

Some may not desire to advance
Waiters earning more per year than their manager
Non salaried staff working lots of overtime earning more than their salaried boss
It probably is not many but some are content in where they are at.

 

[Minnesota disney fan]

But that's the thing -- Not all guests will stop coming at once. If prices mostly increase by 5%, with a reduction in the "cheap guest experience" --- Where the cheap $800 guest no longer gets rope drop, where they no longer get fastpasses, etc... -- Not like the whole world will then stop coming. Some of those cheap $800 guests will stop coming. Some will start spending more than $800. And some will keep spending $800 and accept the lesser experience.

But here is the thing -- If they make the experience worse for the $800 guest -- That's not going to stop the $10,000 guest from showing up.

We have quit going to disney, and it's definitely not the cost.
We have gone to WDW yearly or more for years with extended family and by ourselves.
But we have quit going and are one of those families that are voting with their money. The reason? Not the price increases. It is the decline of "show" for the CM's, the loss of attractions or changes to them, the loss of "freebies" that used to make us feel special and actually wanted by disney. The little extras that made the trip special. Now the hours are cut for normal day trippers. If you want to stay in the evening, then it's an add-on cost. We have never done the extra events, not because we can't afford them, but because of the fact that evenings used to be included in the cost of a daily ticket. There is so much that has been taken away that changed our minds. So, it's not the money. The money is not an issue for most in this society as they just use their credit cards and pay them off later. But I think the changes in the perception of the "brand" of disney is what will hurt them in the long run. IMO!

 

[Basil of Baker Street]

A few I know take out loans to finance their trips to WDW. I just think that's not smart but some don't even think twice about it.

I think once the mask mandate is over you will see an explosion of attendance and many folks will be doing just that.

 

[Thelazer]

Once the collage program is mostly re-staffed you'll see 100% capacity.

 

[Lilofan]

If we are talking an expensive Disney vacation then the Orlando car rental companies have gotten on the profit train. An economy car Kia currently is going for $300/ per day at the airport! That's if you can find a rental.

 

[AugieMorosco]

No, it’s not the point. Focusing more on higher spenders doesn’t mean focusing on caviar and billionaires.
It means focusing more on people who spend $10,000 at Disney (I don’t care if you call that middle class, rich, or anything else) and less on people who spend $800. (Don’t care whether you call these people middle class or something else)

“luxury” is irrelevant to this discussion.

I agree. I think the shift to higher spenders and smaller crowds is something that would be easily viewable on a line graph and in data reports, but not something you'd necessarily notice in the parks unless you were really paying attention.

I do wonder if the year-round fandom of some middle class families (people consistently on ShopDisney, never miss a Disney movie release, etc.) is factored in. I think if families feel excluded from the parks or stop going, the overall brand loyalty erodes and that is felt the rest of the year. Seems the sweet spot for Disney is being very expensive for a middle class family, but still attainable and worth the expense to those families while offering the more luxurious options for the bigger spenders. Very hard to maintain that balance, though.

 

[havoc315]

We have quit going to disney, and it's definitely not the cost.
We have gone to WDW yearly or more for years with extended family and by ourselves.
But we have quit going and are one of those families that are voting with their money. The reason? Not the price increases. It is the decline of "show" for the CM's, the loss of attractions or changes to them, the loss of "freebies" that used to make us feel special and actually wanted by disney. The little extras that made the trip special. Now the hours are cut for normal day trippers. If you want to stay in the evening, then it's an add-on cost. We have never done the extra events, not because we can't afford them, but because of the fact that evenings used to be included in the cost of a daily ticket. There is so much that has been taken away that changed our minds. So, it's not the money. The money is not an issue for most in this society as they just use their credit cards and pay them off later. But I think the changes in the perception of the "brand" of disney is what will hurt them in the long run. IMO!

Im confused... you say it’s not the money, but then cite as a big reason, that they charge add-on costs.

So you object to them charging a second ticket for the night party, but you wouldn’t object if they just doubled or tripled the regular ticket price?

And yes— I’d say money is an issue for EVERYONE, or else we would all live in Mansions and drive Rolls Royces, and luxury yachts.

We all have budgets, credit limits, etc. if your family earns $40,000 per year, it’s unlikely you have a sufficient credit card limit to charge a $20,000 Disney vacation. And if you did charge it, good chance you’d go bankrupt and unable to pay it back.

While Americans definitely overuse their credit cards, we are all still price sensitive.

 

[AugieMorosco]

If we are talking an expensive Disney vacation then the Orlando car rental companies have gotten on the profit train. An economy car Kia currently is going for $300/ per day at the airport! That's if you can find a rental.

All of these rental car companies sold off their fleets and they can't replenish because of the lag in manufacturing. It's going to be this way for awhile. I have a car reserved with Enterprise in Hawaii in early July at about $350 after taxes for the week. I am a little concerned they'll find a way to not honor that rate.

 

[HauntedPirate]

But same is true for average incomes. If the world has 100 million people making 50k... and 10 million making 750k... then the average income is $113,500.

So if the average income for a WDW guest is higher than the average national income, then that means the population of WDW guests skews higher in income than the general population.





Median household income in NYC is 64k... so even in NYC, 75k is slightly above median. (But yes, definitely middle class).
But that 75k earner in NYC is going to have more trouble going to WDW than someone earning 75k from Decatur..as the Decatur 75k will have far greater discretionary income.

And that’s the reality — there is often a distorted view of middle class, where people who consider themselves middle class are really at least upper middle class.

Most American families can’t afford annual vacations to WDW. Sure, there are median earners who visit Disney... but unless they are local, they aren’t going regularly. And when they do go, they drive there, stay off property or value or campgrounds, and they brown bag their meals. They aren’t the guests that are making Disney lots of money.

How much does a week-long WDW vacation for a family of 4 cost... for the guests that actually do drive Disney profits?

I priced out a family of 4, June 26-July 4. Used Disney’s 30% off.

picked Wilderness lodge, 1 of the cheaper deluxe resorts..
With park hopper tickets, $6400.

Add 1 week of on-site dining. Just eating pretty typical meals, easily will spend another $1000-$1500. Could easily spend over $2,000 with a lot of buffets, signature meals, alcohol. But I’ll go low at $1200.

So now at $7600 for food, tickets and lodging. Easily another $400 for incidentals, souvenirs, etc. even $8000.
Still need airfare to get to Orlando.. airport transfers, etc. At least $1,000
So a week long typical Disney vacation to a cheaper deluxe resort.. at least $9,000.

Median household income in the US is around $60,000. Most such families aren’t going to spend 15% of their entire income on a vacation.
Families that can spend $9,000+ on a vacation are above-median earners. And this is who Disney wants to concentrate on. They want to focus more on this family that spends $9,000+...
And focus less on that off-site guest who brown bags their lunch.

You honestly think a family of 4 could eat a week of "typical meals" on-property for $1200? I want some of what you're smoking. $50/person per day is pretty much the absolute minimum, and that's eating all quick service meals with no desserts, no snacks, nothing extra at all. For our family of 6, a week at WDW costs a minimum of $10k, and that's without hotel since we are DVC.

International travelers make up 15% of the travelers to wdw over the year...wealthy or not.

So where do the lions share come from?

shhh! Let him dig his hole deeper.

 

[HauntedPirate]

If we are talking an expensive Disney vacation then the Orlando car rental companies have gotten on the profit train. An economy car Kia currently is going for $300/ per day at the airport! That's if you can find a rental.

$235 for a midsize for a week last week through National. And they had plenty of cars available. Full disclosure: that was a business rate.

 

[nickys]

I think another aspect to remember is that international travelers can often take advantage of an exchange rate in their favor, meaning they pay relatively "lower" prices, albeit with international airfare.

It’s been a long time since the exchange rate was in our favour.

Put it this way, the airfares from the US to Europe are about half what we pay to come over to the US. There are, or were, low cost airlines for those who could travel at off peak times but some have already gone out of business or permanently axed transatlantic flights, and I’d be surprised if any survive.

 

[havoc315]

You honestly think a family of 4 could eat a week of "typical meals" on-property for $1200? I want some of what you're smoking. $50/person per day is pretty much the absolute minimum, and that's eating all quick service meals with no desserts, no snacks, nothing extra at all. For our family of 6, a week at WDW costs a minimum of $10k, and that's without hotel since we are DVC.

I was intentionally keeping the numbers are low as possible, so nobody could say I was exaggerating the cost. Family of 4, 2 of whom are young children..... So kids are about $30 each per day, having an occasional kids meal, sometimes sharing off parents plate. Adults are mostly doing QS. So yes, I'd say $50 per adult per day is about right at the lowest possible.
So over a week: $50 per adult, $30 per kid -- 2 adults, 2 kids -- That comes out to $1120. As I said in my post, it could easily go up to $2000 and higher, without even becoming extravagant. But keeping it conservatively low, $1200 for meals.

And yes...... Disney wants guests like you that spend a minimum of $10K!!

They want to favor a guest like you over the guest family that only spends $800!

Not sure why there ever was a tangent about "middle class" etc. That's all irrelevant. Disney doesn't care if you are a middle class family making $50,000 per year, an upper middle class family making $100,000 per year, or a top earning family of $200,000 per year -- But they do want of the families that spend $10k, and don't care as much about the families that spend $800.
And thus, we see more and more policy changes that hurt the $800 family, but can benefit the family willing to pay $8,000, $10,000, $15,000.

 

[DisneyHead123]

I agree. I think the shift to higher spenders and smaller crowds is something that would be easily viewable on a line graph and in data reports, but not something you'd necessarily notice in the parks unless you were really paying attention.

I do wonder if the year-round fandom of some middle class families (people consistently on ShopDisney, never miss a Disney movie release, etc.) is factored in. I think if families feel excluded from the parks or stop going, the overall brand loyalty erodes and that is felt the rest of the year. Seems the sweet spot for Disney is being very expensive for a middle class family, but still attainable and worth the expense to those families while offering the more luxurious options for the bigger spenders. Very hard to maintain that balance, though.

I hadn't thought of that, it's a good point - as Disney relies on consumerism in many other areas, they may have a vested interest in not being seen as snobbish or deliberately super exclusive in their parks. They also want families to buy that $7 Mickey tee shirt at Target as I'm sure they must make a ton off their various licensing deals.

I'd also read at some point that they are really trying to woo Millennials with increased tech in the parks, trendy food and cocktail offerings, selfie spots, and so on. While Millennials are younger and so more likely to be childfree, I would think, leaving them more disposable income, a quick Google search tells me they make a good bit less on average than Boomers. But, they are young and they are the future and the next generation of park goers - so it seems to me that Disney has to have considerations on a lot of fronts. (Although having said that, Chapek is a new leader, so it could be that he's bringing in a new strategy with him.)