News Disney CEO Bob Chapek reiterates his belief that park reservations are now an essential part of Disney's theme parks business

[lazyboy97o]

I can understand this, for example, you can reduce the number of folks into the park my half and close half of the park and it be more crowded, but how are they reducing capacity and worsening the crowding right now?

Is it lack attractions and folks not able to ride attractions due to Genie+ snd ILL and just wondering around?

Capacity is a word that gets used a lot but really has a variety of definitions based on the context.

The most basic type that most people refer to other regards to crowding is how many people can physically fit into a space, what is called occupant load in a building. For attractions and dining venues there is a similar concept known as instantaneous capacity, this is how many people these venues are designed to hold.

Theme parks though are really designed around throughput, the hourly capacity. How much you want people to do in a day determines the hourly capacity of the park. This is important because how much you want people to wait for things is a major factor in determining physical sizes.

While most people generally only talk about hourly capacity in regards to rides, it is also a factor in the design of other aspects of a park, particularly dining. Restaurants are designed for throughput. How long you want people waiting will determine not only how many tables and chairs you have, but also the size of the kitchen, how many registers there are and how much queue space, even if not formally delineated, is available at each register. If you’re okay with people waiting longer you might need a smaller kitchen and dining area, but also need a larger queue and waiting area. Closing registers increase the number of people going to the remaining open registers. Even if a lot of people go somewhere else, you can easily end up in a situation where it too much for the open registers. Even though the physical space to hold people exists, they all crowd around the open registers because that’s where you have to be to order and receive your food. This all gets compounded if you’ve determined across the board that people will wait longer. There’s all sorts of inefficiencies that were not part of how the park was designed so you can end up with all sorts of spaces that are less attended but feel more crowded.

Now add on years of poor design that further concentrate people, and add on a virtual queue system (which requires more capacity to be available) then you have a recipe for problems. Still having things like stores closed all contribute to further crowding, more so that attractions being closed because they are less intrinsically tied to how the capacity of a park is determined.

 

[Casper Gutman]

Yes, I'm sure Universal wants a healthy tourist ecosystem based around theme parks to survive in Orlando more than it would want WDW to go out of business. I do think a good bet for them is to try and position themselves as slightly less expensive and (especially) a lot less of a hassle than a visit to Disney. In other words, endure a day at the Magic Kingdom and enjoy the rest of your vacation hopping at will between our three world-class theme parks, water parks, shopping and dining, and resort hotels.

Personally, I think they should move away from the slightly obnoxious swipes at Disney and focus on selling their strengths.

I'll freely admit that I enjoy the swipes. They help push the desired image that Uni is a looser, wittier, more adaptable company (ultimately not really true - it's Comcast, after all) while Disney is stiff, slow, pompous, and arrogant and can't communicate without absurdly unnatural board room PR (that part is all true). It also mirrors an annoyance that, tellingly, enough folks seem to share about Disney that voicing it is an effective advertising technique.

I wonder how Disney would be doing WITHOUT Universal, and particularly without the HP lands dramatically expanding the pool of Orlando tourists in a way Disney pretends is impossible. Without Uni, would Disney counterintuitively have had to build more aggressively? Would their numbers have stagnated? We always think of Uni in terms of its main competition and the broader Orlando tourist market, but we need to put WDW in that context more often. Disney is still the big fish in the lake, but all the other fish are getting bigger, and its becoming more clear how interdependent they are.

 

[updownandsideways]

In my opinion, I believe all these systems are to get a certain type of guest in the park and keep others out. also to add, this is a by-product of technology, it will get more mix-mixed or squeezeing the lemons more as time goes on, as technology advances.

 

[drizgirl]

When people are paying so little to come into the parks, that seems to be enough.

You know not everyone is an AP holder, right?

 

[MrPromey]

I agree with this as well. But imo, 10-15 years or so Disney is going to have a big problem. The wave of discontent is slow moving but it's building. I look at my own social circle of friends, family, colleagues and almost no one is interested in a Disney vacation for their young children. They aren't building that relationship with future guests to sustain the money making machine. I keep thinking about when Gen Z have their kids...I just think Disney is in trouble long term.

Bob and co. will be cashed out long before that point and Wall Street will have plenty of time to jump ship so it's not a problem... unless of course, you're a fan but nobody is doing any of this for the fans they profess to "love" anymore.

 

[MrPromey]

...

It would be one thing of the parks were sparkling clean and attractions running in top condition as "Disney parks are expensive" isn't a particularly compelling story. When you can illustrate that with pictures of the mouldy exterior of Space Mountain or multiple examples of rides running with broken AAs, though, you do have a more interesting story of a greedy corporation bleeding consumers and cutting costs whatever precisely is going on. It's strange/arrogant to me that Disney seems a little indifferent to upkeep amidst all this bad publicity over price rises.

I don't think they're being indifferent so much as being caught purposefully avoiding the maintenance.

If you believe the line that everything they're doing - the reservations, Genie+, price increases - is all to provide a better guest experience, that seems confusing but if you look at what they're doing rather than what they're saying, it's pretty obvious what's going on.

You don't raise prices to make a quick extra buck and then invest that extra buck on improving things, especially if that improvement is going to be an ongoing cost. If you do, then you've just lost your quick extra buck. Then you'll have to raise prices even more to cover the actual increase in costs without impacting your increased profit which will only make it harder to pull off your next profit price increase for future extra bucks when you need to shake that money tree to show continued growth down the road.

 

[lazyboy97o]

The population of the United States (and the world) is much larger, and growing. The US population was about 225 million in the 1980 census; it was 331 million in the 2020 census.

That's certainly not the sole reason for attendance increase, but it's a significant factor. There's simply a larger customer base from which to pull attendees. You'd expect attendance to increase by 40% or so from 1980 to today just from simple population growth, although they've also built three new parks (and some water parks) in that time period.

There was also a general, global boom in tourism. Tons of places saw increases in visitation without adding anything new.

 

[Sir_Cliff]

I'll freely admit that I enjoy the swipes. They help push the desired image that Uni is a looser, wittier, more adaptable company (ultimately not really true - it's Comcast, after all) while Disney is stiff, slow, pompous, and arrogant and can't communicate without absurdly unnatural board room PR (that part is all true). It also mirrors an annoyance that, tellingly, enough folks seem to share about Disney that voicing it is an effective advertising technique.

I wonder how Disney would be doing WITHOUT Universal, and particularly without the HP lands dramatically expanding the pool of Orlando tourists in a way Disney pretends is impossible. Without Uni, would Disney counterintuitively have had to build more aggressively? Would their numbers have stagnated? We always think of Uni in terms of its main competition and the broader Orlando tourist market, but we need to put WDW in that context more often. Disney is still the big fish in the lake, but all the other fish are getting bigger, and its becoming more clear how interdependent they are.

That is a very interesting point that I hadn't considered: the extent to which Uni and specifically the HP lands helped propel momentum in the Orlando theme park market at a time Disney had basically given up based on the belief it was a mature market with little room for growth. It is interesting to ponder whether Disney would have eventually had to build more aggressively or, alternatively, have left WDW to languish even further under the belief that stagnant numbers confirmed what they already believed about the market.

 

[MrPromey]

So why haven't they doubled the price on everything already? If they could easily shed half of their existing customers, doubling the price shouldn't be a barrier to accomplishing that goal.

Exactly!

Why try to hide price increases in things like Genie+ and resort parking fees and reduced portions and other sly ways to make it not look like the advertised price has changed so much?

If your goal is truly to create sticker shock and scare off the plebs, why not slap that high price right on the front while saying it loud and proud?

The methods they're employing seem awfully counterintuitive if one is to believe they are wanting to reduce attendance unless there is some secret sinister plan is to empty the pockets of the underprivileged one last time before kicking them to the curb.

One last trip for that family from Colorado so they can spend $10k to get there and discover Disney doesn't want them anymore, maybe?

No, I don't think they have a secret sinister plan - just Bob trying to tell us the sky is green.

 

[lazyboy97o]

Exactly!

Why try to hide price increases in things like Genie+ and parking fees and reduced portions and other sly ways to make it not look like the advertised price has changed so much?

If your goal is truly to create sticker shock and scare off the plebs, why not slap that high price right on the front while saying it loud and proud?

The methods they're employing seem awfully counterintuitive if one is to believe they are wanting to reduce attendance unless there is some secret sinister plan is to empty the pockets of the underprivileged one last time before kicking them to the curb.

One last trip for that family from Colorado so they can spend $10k to get there and discover Disney doesn't want them anymore, maybe?

No, I don't think they have a secret sinister plan.

They are so worried about visibly raising prices too much they spent a few hundred million to try and trick people into spending more with MagicBands.

 

[MrPromey]

If that's true they've already lost. There's no point in building new attractions if you make your money selling popcorn buckets.

Then how do you think they did it for most of the 50 years up to this point?

After they dumped the ticket book system, by your calculations, everything that wasn't a food or merch stand in the parks was a weirdly overlooked loss-leader, right?

Why did they continue to add more?

I'd call it, what people paid to come in and do but by your calculations, Pirates of the Caribbean only ever existed to be the entrance to the gift shop at the end, right?

Or have you never actually been to a theme park?

 

[MrPromey]

You're essentially just talking about Magic Kingdom, though. Even the massively reduced 2021 numbers suggest an average of almost 100,000 people showing up every day to visit their 4 parks, ignoring the water parks. That's a lot of people to lure to Central Florida to pay premium prices day in day out when people have plenty of other options for how to spend their leisure time. They also have to lure them away from competing world-class theme parks nearby.

Perhaps demand for Magic Kingdom is such that it can remaining successful for the foreseeable future. They have three other theme parks, two water parks, a shopping district, and tens of thousands of hotel rooms they also have to keep busy, however. In that context, I can entirely imagine the scenario outlined by @lazyboy97o a few pages back where the company manages to alienate too many of its customers and then flails around not knowing how to attract enough people back to make a resort the size of WDW viable.

All while still having the MK be overcrowded.

 

[updownandsideways]

Then how do you think they did it for most of the 50 years up to this point?

After they dumped the ticket book system, by your calculations, everything that wasn't a food or merch stand in the parks was a weirdly overlooked loss-leader, right?

I'd call it, what people paid to come in and do but by your calculations, Pirates of the Caribbean only ever existed to be the entrance to the gift shop at the end, right?

Or have you never actually been to a theme park?

Well he isn't wrong, the ticket price is nothing compared to the dollars of merch and food sales.

 

[MrPromey]

I'm not sure I'm following the logic here. Surely they need to keep adding attraction capacity and new attractions to attract visitors to buy the merchandise? People aren't going to come just to buy popcorn buckets and pretzels, but more and new rides act as a lure to attract people to buy the popcorn buckets and pretzels... and hotel rooms Lower attendance but each guest paying a higher admission price, meanwhile, has to be balanced against lost revenue from the sale of popcorn buckets, pretzels, hotel rooms, etc. Or am I missing something?

Target and Starbucks executives have been missing the boat by not charging admission all these years, apparently.

I'm beginging to think this person has never actually been to a theme park and just enjoys arguing on the internet for it to reach a place in discussion where someone has to point this out to them in a counter-argument.

 

[MrPromey]

Well he isn't wrong, the ticket price is nothing compared to the dollars of merch and food sales.

Except most people aren't planning trips across the country or across the world to stay in their overpriced resorts and then pay to get into their parks for the sole purpose of buying merch and food.

Lets see them close down every "free"* attraction on property and then see what happens to everything else.

I can't believe this is something that even needs to be discussed.


*not free as in beer, obviously

 

[MrPromey]

So are you saying companies should put out attacks ads against other competing companies?

That seems like a slippery slope?

It's nothing new. In some form or another, Universal has done it for years.

Burger King used to do it all the time to McDs.

When you're number 2, you attack number 1.

When you're number 1, you do your best to pretend to the public that number 2 doesn't exist because if you acknowledge them or try to "attack" back you put them on equal footing to you in the public's eye.

It's the marketing equivalent of tossing a devil's snare at your opponent when they're on higher ground.

Their only winning option is to try to ignore and avoid it because if they engage, they get pulled in.

Burger King and Universal are just two examples but it's a tactic that's been at work in marketing for at least a century.

The ads by Pepsi comparing their taste and/or value to Coke since around 1900 are legion. Show me one example where Coke has ever even mentioned Pepsi.

... Of course, more than a hundred years in and Pepsi is still #2 so maybe there is something to be said for that tactic having limited effectiveness.

 

[TrainsOfDisney]

movie theaters make their money off of concessions but they still have to actually show movies that people want to see.

I wish Disney worked on that model… the admission price covered the attractions and the profit was made on the f&b and merchandise.

 

[Vegas Disney Fan]

Except most people aren't planning trips across the country or across the world to stay in their overpriced resorts and then pay to get into their parks for the sole purpose of buying merch and food.

Lets see them close down every attraction on property and then seen what happens to everything else.

I can't believe this is something that even needs to be discussed.

Nobody’s going to Florida to shop but I know a ton of people who frequently went to the Disney stores to shop. I’d love to know how much money they’ve lost by closing most the brick and mortar Disney stores. I used to go shopping at ours once a month, now it’s such a hassle to get to one it’s probably once every 6 months or more. I still buy a few things online but nothing like the impulse buying I’d do in person. They did open a Disney section in one of our Targets and it’s the most pathetic thing I’ve seen.

Disneys made a ton of boneheaded decisions recently but taking away places to buy cheap Chinese products at ridiculously inflated Disney prices seems like one of the most boneheaded ones.

 

[TrainsOfDisney]

So are you saying companies should put out attacks ads against other competing companies?

That seems like a slippery slope?

Princess Cruise lines had a fantastic commercial this summer for Alaska cruises vs. Disney parks.

 

[Vegas Disney Fan]

Princess Cruise lines had a fantastic commercial this summer for Alaska cruises vs. Disney parks.

That’s good marketing!