Originally posted by kverdon
Mousesavers has just posted an interresting editorial on the future (or possible lack thereof) of Annual Pass discounts and room-only bookings. Seems that they think that Disney is moving away from room-only bookings and trying to get people to book packages instead.
Kevin and Mona
For anyone interested, here is the full story:
Feature Article: The Future of Disney World Discounts
Lately I've been getting a lot of questions about the status of "room only" discounts for the Walt Disney World resorts. There hasn't been a "room only" discount available to the general public since late April. Annual Passholder discounts have been released much later this year than in previous years. Currently there are no Annual Passholder discounts beyond August 23.
This is a huge change from the trends of the past few years, as many of you are aware. When I started MouseSavers.com in early 2001, there were loads of discount codes floating around on the Internet, and it was pretty easy to get a discount of 40-45% on Disney's resort rooms, particularly in the off-season. The events of 9/11 and economic worries only caused Disney to discount its hotel rooms even more aggressively, as tourism took a major downturn.
But now there are quite a few factors working against such widespread and hefty discounts on "room only" rates. For one thing, many travel suppliers (including the airlines) have decided to reduce their capacity. Instead of selling the product cheaper, they've opted to keep prices up by reducing supply -- and in so doing, they've cut costs, too. In the past year or so, Disney has frequently shut down one or more of its resorts (or specific buildings at its resorts) for "renovation," when in reality it was probably just reducing the number of rooms it had to fill.
Additionally, Disney has clearly decided to change its marketing strategies in several ways, including controlling the use of discount codes, making "room only" rates more difficult to book, and making vacation packages more attractive.
Until recently, Disney offered resort discount codes through many advertising outlets, including newspaper and magazine ads. The reason for issuing codes was not only to sell more rooms. Codes were also supposed to help Disney track demographics and assess which advertising outlets produced the best response. Disney apparently didn't count on the Internet allowing its "targeted" codes to be rapidly disseminated all over the world. For instance, Disney would run an ad in a Spanish-language edition of People magazine, and two days later an English-speaking mom in Topeka learned about it on a discussion board or web site, called the Disney Reservations Center and got that discount. Consequently Disney's marketing department had no idea how many Spanish-speaking People magazine readers had responded to the ad.
When I first launched MouseSavers.com, Disney was sending out a lot of postcards with resort discount codes on them. Initially these postcard codes were also widely shared on the Internet, which apparently was a problem for Disney. Sometime in 2002, Disney hit on the idea of adding a unique PIN to each card that was specific to the recipient. Only the recipient could use that discount. Now all Disney postcards and e-mails containing resort discount codes include such PINs.
As someone who has worked in marketing for years, I completely understand why Disney wants to get its promotional discount codes under control. After all, it's very expensive to advertise and as a marketing manager you want to know whether a specific ad is productive, so that you can decide whether to keep advertising through that outlet. Targeted marketing codes are supposed to help you figure that out. However, the Internet has made that very difficult - I might even say impossible.
(As an aside, I've been saying for years that Disney really should have put out an equivalent Internet code whenever it released codes in newspapers and magazines. I for one would have been happy to list only the Internet code on my web site, so that Disney could see how many sales it got from MouseSavers.com and other sites!)
In any case, since late April of this year, Disney seems to have moved away from issuing discount codes through major advertising outlets. Will this be a permanent change? Only time will tell. If Disney can fill enough rooms by sending out targeted codes in e-mails and postcards, that probably will be its preferred marketing strategy. E-mail, in particular, is far more cost-effective than full-page newspaper ads and it's easier to track the results.
(By the way, if you're wondering how to get on the lists for postcards and e-mails containing discount codes for Disney's resorts - I don't know, exactly. I sometimes get these mailings and it's not usually apparent to me which list my name came from. It's certainly a good idea to register with Disney.com and click on the boxes that indicate you're interested in Walt Disney World. Subscribing to Disney Magazine, getting Disney's Visa card and entering Disney-sponsored sweepstakes will probably also put you on some mailing lists. While I can't guarantee you'll get a postcard or e-mail as a result of signing up for every Disney offer you can find, it can't hurt!)
Disney is also making it more and more difficult to book a "room only" rate. For the past couple of years, the rumor has been floating around that the Disney Reservations Center planned to combine its Central Reservations Office (CRO), which is responsible for "room only" reservations, with Walt Disney Travel Company (WDTC), which sells packages. Now this merger actually appears to be happening. Fewer and fewer of the phone agents know how to book a "room only" reservation under the guest-friendly CRO rules, which allow you to put down only a one-night room deposit and pay the remaining amount when you check in. Most agents are now trained only to sell WDTC packages, which require advance payment and have more stringent cancellation penalties.
Some of the agents at the Disney Reservations Center are even putting out the word that there is "no longer a CRO." I think this may be the case, or may soon be true, though it's still possible to book a "room only" reservation and get the rules that used to be called "CRO rules." So now you'll need to specify that you want a "room only" rate with NO extras, a one-night deposit and final payment due at check-in. If you let them talk you into adding anything (tickets, mini-golf, etc) it appears you'll be subject to WDTC package rules.
Disney seems to be willing to do whatever it takes to sell more vacation packages -- including heavy discounting. I predicted several months ago that "room only" discount codes and Annual Passholder rates were going to be few and far between in the future, because of promotions like the Fairytale Vacation package, which offered a discount of over 40% on both your room and tickets. So far it looks like I have been correct. The whole point of "room only" discounts was to fill excess rooms that were going to remain unsold otherwise. Apparently that's not a big issue currently.
So the reality is that if Disney's current marketing approach continues, more discounted packages will be offered and fewer "room only" rates will be available, making packages an attractive option for many guests. Fortunately for the consumer, lately some of Disney's discounted packages have been really tempting, such as the Fairytale Vacation Packages. Also, as of 2003, Disney has eliminated the rip-offs that used to be associated with many of its full price packages. Now, even if you buy a package right out of the brochure, at least you will come out even, since you won't pay more than the cost of a room at rack rate and Ultimate Park Hopper passes at full price.
One objection to packages I hear pretty frequently is that they include the Ultimate Park Hopper (UPH) passes. Unlike regular Hopper passes, the UPHs are strictly "use it or lose it." If you spend a day at Universal when you're on a Disney package, you've paid for a UPH day you didn't use. Disney hopes you'll choose to spend that day at Disney-MGM Studios instead… but even if you don't, they've got your money! So that is a significant issue you'll need to take into account as you plan. (There are ways to work around that issue -- for instance, book a shorter package at Disney and then move to one of the Universal hotels for the rest of your vacation.)
Another common perception is that Ultimate Park Hopper passes are too expensive. However, it was recently pointed out to me that the UPH prices are surprisingly competitive with Park Hopper PLUS passes for stays of 4, 5 or 6 nights. Take a look at the advance purchase prices -- you'll discover that the UPH is only a little more than an equivalent-length Park Hopper PLUS pass.
I do understand that some visitors to Walt Disney World may not need or want the Ultimate Park Hopper passes that come with packages. Like some of you, I have an Annual Pass, so packages don't currently work for me. (However, I'm reassessing whether I will renew my Annual Pass, given the trends I'm seeing.) Some people would rather buy regular Hoppers, since any unused days don't expire. Some people don't plan to visit water parks, Pleasure Island or DisneyQuest, so they feel the "extras" included on the UPH are unnecessary for them.
So what's an Annual Passholder to do? Well, of course you can wait and see whether Annual Passholder rates are released for the time you plan to travel, which may or may not happen. (If it does happen, it will almost certainly be at the very last minute, so you're going to have to be flexible about your plans.) Or you can stay at the Swan and Dolphin, which are currently offering phenomenal discounts for Annual Passholders through the rest of 2003, subject to some blackout dates. You can learn more about those discounts at
http://www.mousesavers.com/swandolphin.html
Passholders and members of the general public who aren't willing to pay "rack rates" at Disney and/or don't want to buy a package can try to get AAA or Disney Club discounts on "room only" reservations, if you qualify for those. Or consider renting points from a Disney Vacation Club member - I explain how on MouseSavers.com. Alternatively, consider staying at one of the many non-Disney hotels that are currently offering extremely attractive discounts. If you can't get a room at one of Disney's resorts at a price you're willing to pay, I say "vote with your feet" and stay elsewhere! There are plenty of deals at the Downtown Disney resorts and off-site.
