Bob Iger: "We Don't Believe We Have A Pricing Issue At Our Domestic Parks"

Chef Mickey

Well-Known Member
Original Poster
Listening to the earnings call live at the moment, Disney said domestic park attendance was down 3% versus last year and analysts were questioning why.

Interestingly, Iger flat out said there is no pricing issue based on a lot of market research and data within the company. Instead, Disney gave reasons such as people waiting for crowds at Galaxy's Edge to subside and annual passholders staying away from DL.

I find this fascinating as consumers are so resilient. The pricing is based on the "value of the franchises" and investments in new attractions and experiences, according to Iger.

I have been openly resilient to price increase, but recently posted a thread complaining about the product itself suffering while prices have continued to increase, here: https://forums.wdwmagic.com/threads/ok-ill-admit-it-disney-prices-are-out-of-control.956080/

Seems crowds have spoken a tiny bit and I'm not completely buying it's because of Galaxy's Edge.
 

jloucks

Well-Known Member
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Listening to the earnings call live at the moment, Disney said domestic park attendance was down 3% versus last year and analysts were questioning why.

Interestingly, Iger flat out said there is no pricing issue based on a lot of market research and data within the company. Instead, Disney gave reasons such as people waiting for crowds at Galaxy's Edge to subside and annual passholders staying away from DL.

I find this fascinating as consumers are so resilient. The pricing is based on the "value of the franchises" and investments in new attractions and experiences, according to Iger.

I have been openly resilient to price increase, but recently posted a thread complaining about the product itself suffering while prices have continued to increase, here: https://forums.wdwmagic.com/threads/ok-ill-admit-it-disney-prices-are-out-of-control.956080/

Seems crowds have spoken a tiny bit and I'm not completely buying it's because of Galaxy's Edge.
3% tho, that is a tiny blip. Hard to explain with any certainty in many situations. Definitely not enough for a regular person to enjoy. Enjoy as in, a signal for those that have been avoiding the crowds to return.

Lol, I need to see a nice 20% dip for me to return. :p
 

Jim S

Well-Known Member
Disney is a special place for me, wife, my grown kids and spouses, and 6 grandkids. Each time we go it loses a little appeal because of the crowds, the cost, THE EARLY UNECCESSARY CLOSINGS, and the rip off money grab disguised as a resort parking fee.

We keep going but each visit it loses a small part of that magic because of the the cost versus the value and the fact we just want to feel we are appreciated.
 

Chef Mickey

Well-Known Member
Original Poster
3% tho, that is a tiny blip. Hard to explain with any certainty in many situations. Definitely not enough for a regular person to enjoy. Enjoy as in, a signal for those that have been avoiding the crowds to return.

Lol, I need to see a nice 20% dip for me to return. :p
Agreed and there is probably some truth to the Galaxy's Edge excuse, but I did find it interesting he was so quick to offer the pricing not being an issue.

I do think they have some quality issues right now, perhaps because they've cut costs too deep with staff and crammed too many people in the parks (even with the drop in attendance).

20% sounds about right to thin out crowds a little...of course, then you'd see discounts to get people back.
 

willtravel

Well-Known Member
20% sounds about right to thin out crowds a little...of course, then you'd see discounts to get people back.
But what would be a discount? I am in the camp of the prices are too high ON EVERYRHING. They raise the price then give a discount? 20 to 30% off selected resorts, blah, blah, blah...…… Even with a discount on the rooms now, I feel it's too high. What would it do put the cost back to last years pricing.

I use to work in retail for a long time and saw how prices go up due to competitive pricing or right before it goes on sale the price goes up so it can go down and they make profit. Just sad but the way it is. JMO
 

dieboy

Active Member
I don't know why this is surprising? Disney is a corporate entity, driven by the board and the share holders. Both of whom demand profit at the expense of anything that gets in the way of said profits.

Anyone whom believes the idea that they will ever change, or any of this will get better, even by some poor attendance is kidding themselves.

Nutshell: Two new open lands. Multiple new rides in the near term. Iger is looking at it as he was hired to do, in a fruggle and business like fashion. They do have allot invested recently. It will take a bit of time to see ROI on those items.

Was going to add a new reply but well .. meh.

Most of the people i know that make a mediumish to looooow high income embark on a WDW trip maybe once every few years. These are all friends for the most part, whom have a kid or two or three. Most of them cite the nightmare that occurs in their wallet every time they start to plan a trip there. Most of them say they save for a year just for five days. The reality of it, a 3% dip is well hardly noticable in the grand scheme of things. People will keep coming, attendance will even out.
The current Disney should feel very thankful, it was good as long as it was under early leadership. That in turn created a tradition that is spanning generations at this point. And making them a good amount of money to boot.
 
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hanwill

Well-Known Member
Please explain to me how you are thinking 3 % is not a big drop. When retail sales are down 5% markets and companies are in a panic because this is a big deal. I would think that if building new lands and you have a three percent drop- it's really a larger long term drop that they are just starting to see. Otherwise- people( investors) wouldn't be asking about it. I think they are just starting tho see they have outpriced/under appreciated their base audience....
 

Disstevefan1

Well-Known Member
I am surprised attendance is down only 3 percent. The price increases on EVERYTHING at parks and resorts more than makes up for that.

Attendance is down 3 percent in the third quarter BUT Revenue for parks was UP 7 percent!
Attendance is down 3 percent in the third quarter BUT guest spending was up 10 percent!

Also, the movies Disney is putting out of recent is breaking records in revenue.

All is fine in the House of Mouse..
 
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winstongator

Well-Known Member
I am surprised attendance is down only 3 percent. The price increases on EVERYTHING at parks and resorts more than makes up for that.

Attendance is down 3 percent in the third quarter BUT Revenue for parks was UP 7 percent!
Attendance is down 3 percent in the third quarter BUT guest spending was up 10 percent!

Also, the movies Disney is putting out of recent is breaking records in revenue.

All is fine in the House of Mouse..
Edit: the +7% & -3% is domestic. Big impact of price increases.

Is the 7 & 10% for domestic parks, and the 3% decline? It seemed like some of the parks did better this quarter, but definitely not DL. They don’t break down by park, but the blackouts must have driven some of it. I’m going to wait to listen or when they upload the transcript of the call.
 
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eliza61nyc

Well-Known Member
I am surprised attendance is down only 3 percent. The price increases on EVERYTHING at parks and resorts more than makes up for that.

Attendance is down 3 percent in the third quarter BUT Revenue for parks was UP 7 percent!
Attendance is down 3 percent in the third quarter BUT guest spending was up 10 percent!

Also, the movies Disney is putting out of recent is breaking records in revenue.

All is fine in the House of Mouse..

and although Iger is akin to the anti-christ here, this article sums up why elsewhere folks are happy campers.

https://www.cnbc.com/2019/08/06/bob-iger-forever-changed-disney-with-4-key-acquisitions.html

In the year that Iger was named CEO, Disney made $2.5 billion in net income. Last year, the company’s net income was $12.6 billion, a 404% increase. Similarly, Disney stock has risen exponentially. Shares of Disney are up 450% from $25 per share in 2005 to nearly $140 in August 2019.
 

DrummerAlly

Well-Known Member
This is brought up frequently, but I think your view on this is going to depend on the region you live in and what activities you compare it to.

I recently stayed for one night at a Holiday Inn in North Adams, MA. It's the Berkshires, but its really nothing special - its just a bland tiny city with some nice state parks near by. It was just okay even by Holiday Inn Standards. After taxes and fees, it was just over $300 for the single night.

The average price per night at Animal Kingdom Lodge is $415/night during my stay. Those two properties are night and day different. It makes AKL look like a HUGE bargain. Hotels are just expensive these days.

We can play the same game with the park tickets. Yes, It's well over $100 a day at the MK for a single day ticket, but a 3 hour off-broadway show in your home city also runs over $100 a ticket. Entertainment is just expensive these days.
 

CLEtoWDW

Well-Known Member
Iger is 100000% correct. There isn’t a pricing issue but rather a capacity issue. As a Disney shareholder I’d rather see attendance slightly turn down but profitability turn up due to the revenue per guest increasing drastically. We all complain about the parks being “always crowded” and this new pricing strategy will address this problem.
 

DuckTalesWooHoo1987

Well-Known Member
Iger is 100000% correct. There isn’t a pricing issue but rather a capacity issue. As a Disney shareholder I’d rather see attendance slightly turn down but profitability turn up due to the revenue per guest increasing drastically. We all complain about the parks being “always crowded” and this new pricing strategy will address this problem.
I want to believe that prices might lower the crowds but I've just been mentally broken by the crowds and have reached the conclusion that Disneyworld is like gas and no matter what gets charged for it people will just pay it anyway. I want to be wrong though.
 

Chef Mickey

Well-Known Member
Original Poster
I don't know why this is surprising? Disney is a corporate entity, driven by the board and the share holders. Both of whom demand profit at the expense of anything that gets in the way of said profits.

Anyone whom believes the idea that they will ever change, or any of this will get better, even by some poor attendance is kidding themselves.

Nutshell: Two new open lands. Multiple new rides in the near term. Iger is looking at it as he was hired to do, in a fruggle and business like fashion. They do have allot invested recently. It will take a bit of time to see ROI on those items.

Was going to add a new reply but well .. meh.

Most of the people i know that make a mediumish to looooow high income embark on a WDW trip maybe once every few years. These are all friends for the most part, whom have a kid or two or three. Most of them cite the nightmare that occurs in their wallet every time they start to plan a trip there. Most of them say they save for a year just for five days. The reality of it, a 3% dip is well hardly noticable in the grand scheme of things. People will keep coming, attendance will even out.
The current Disney should feel very thankful, it was good as long as it was under early leadership. That in turn created a tradition that is spanning generations at this point. And making them a good amount of money to boot.
I don’t think the price increases are surprising. Never said I did.

I said I’m surprised how resilient the consumer has been to price increases at Disney.
 

Chef Mickey

Well-Known Member
Original Poster
and although Iger is akin to the anti-christ here, this article sums up why elsewhere folks are happy campers.

https://www.cnbc.com/2019/08/06/bob-iger-forever-changed-disney-with-4-key-acquisitions.html

In the year that Iger was named CEO, Disney made $2.5 billion in net income. Last year, the company’s net income was $12.6 billion, a 404% increase. Similarly, Disney stock has risen exponentially. Shares of Disney are up 450% from $25 per share in 2005 to nearly $140 in August 2019.
I’m a shareholder too. No doubt, Iger has been a pimp for the stock.

He’s been terrible for the fans of Disney World in particular.
 

eliza61nyc

Well-Known Member
Your a shareholder though. It's in your best interest to pump up Iger and Disney Corp because you profit monetarily. I would do the exact same thing if I owned alot of Disney stock.
Hey Pooh, I actually think it's not even that. LOL ok, disclaimer these are just my ramblings.

Now first, I don't think John q public is all that deep into Disney they way we are. I often wonder, do the majority of guest really give a flip that the hotels don't have a cohesive "theme"? I don't think they do. How many guest do you really think are upset that Frozen is in Norweigh and they took out maelstrom? I'm a big fan but I'm definitely in the minors compared to some folks here. No way do I nit pick the authenticity of a lunch counter. so I think for a number of guest they still see the magic.

Next, and lol I hate saying this because I'm firmly in AARP ville myself but @Pooh.sHoneyHuntTDL we're getting old. lol and as we get older, the "good" old days fade further and further into memory. It's like everyone's love of the old figment, while I've watched many of martins videos, they don't move me because I never experienced them in real life.

lastly, I do think today's visitors are a little more forgiving then fandom folks. again real life experience is working against us. $4.00 cokes is no longer shocking to anyone who travels to major cities or even major vacation destinations. resort fees and parking fees? not even a blimp. now again, we're upset becasue we see it as nitpicking. Joe Q who is bringing his family from Chicago and has to pay 35 bucks to park at a museum? not so much.

Personally I've said before I think the crowd issue is the bigger problem. They get the crowds under control and I daresay they could charge whatever they want.

I was actually just pointing out why the general public doesn't view Iger with disdain.
 
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