Ah, those guys. My gosh yes, the Parks aren't even a blip for most of those CNBC types. They think it's just that tacky amusement park down in the swamp that their hair stylist and car mechanic goes to.
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Disneyland During A Recession - Anaheim's 2022-23 Strategy?
- Thread starter TP2000
- Start date
Ah, those guys. My gosh yes, the Parks aren't even a blip for most of those CNBC types. They think it's just that tacky amusement park down in the swamp that their hair stylist and car mechanic goes to.
3Q results and call (in 40 minutes) here...
Disney’s Q3 FY22 Earnings Results Webcast
The Walt Disney Company will discuss fiscal third quarter 2022 financial results via a live audio webcast beginning at 4:30 p.m. ET / 1:30 p.m. PT on Wednesday, August 10, 2022. https://thewaltdisneycompany.com/disneys-q3-fy22-earnings-results-webcast/forums.wdwmagic.com
Disneyland Resort got called out on the earning's call. It's the classic... "WDW is doing great and its hotels are full, but Disneyland gets too many cheapy locals who smuggle in carrot sticks for their kids and scuttle across Harbor to eat at McDonald's instead of buying our overpriced cheeseburgers."
But the official statement reads more guarded, from Page 7 of the earning's call statement...
"The increase in average per capita ticket revenue was due to the introduction of Genie+ and Lightning Lane in the first quarter of the current fiscal year and a reduced impact from promotions at Walt Disney World Resort, partially offset by an unfavorable attendance mix at Disneyland Resort."
Disney Irish
Premium Member
Well then I think you just got your answer about how Disney will handle a recession at DLR, less Magic Keys/APs not more.
Let's hope. Although I honestly don't think they have the institutional memory in place to remember that lesson.
They'll need to do something with tickets, some gimmick or sales promotion for the 20 Million locals in SoCal who make up a big chunk of their attendance.
Although that won't help the "unfavorable attendance mix" already happening at Disneyland this past fiscal quarter.
Disney Irish
Premium Member
They'll likely do what they've been doing this year, 3 day California resident discount tickets.
Maybe. But Mr. Potrock has his tail between his legs this afternoon after getting called out like that by the Chairman on the earning's report. It's not a good look for any senior exec to have his division called out that bluntly, and it's obviously something Burbank wants fixed.
Stay tuned...
Disney Irish
Premium Member
I don't see it that way, but you and I rarely see eye-to-eye on a lot of things.
You think Disneyland is happy to be scolded in the earning's report for having an "unfavorable attendance mix"???
Wendy Pleakley
Well-Known Member
I don't see streaming as replacing theatrical revenue, but more likely a replacement for the home video market. The old me probably would have bought Dr. Strange on disc, but I didn't because it's part of my Disney+ library.
Similar to Apple Music or Spotify, that monthly fee allows one to build a library of home entertainment. That's one major way they keep subscribers. End your subscription and you lose your music or video library. It's part of a shift where we are less likely to own content but rather pay a regular fee to access it. It's happening in video games too, particularly the mobile market, where there are less options to buy a game outright but there are subscription models to unlock the product.
Will streaming impact theatrical revenue? Maybe. People still seem willing to pay for the theatrical experience. At least for things like Top Gun that just aren't the same on a television.
Financially, instead of paying $25 for Dr. Strange on disc I'm paying my monthly fee for Disney+. The difference is probably negligible when you consider how much of that $25 goes to manufacturing and retailer markup. Movies are still generating income.
Disney Irish
Premium Member
I don't see it as a scolding.
Disney Irish
Premium Member
This is exactly what it is and why its counted toward the ancillary revenue of content on the service, similar to PVOD.
I agree that streaming has replaced DVD sales. They barely sell DVD's now at all, and at my local Best Buy they now have a larger section devoted to vinyl records than they do to DVD's. Don't get me started on how funny I think it is that the kids are into vinyl records!
But when fans like us bought DVD's twenty years ago for $25, and blu-rays a decade ago for $30, that was impactful revenue. Now we get all the movies we want for 8 bucks a month. Soon to be 10 bucks a month. And the division that creates that service hasn't been profitable yet, and isn't scheduled to eek out a profit for at least two more fiscal years.
Meanwhile, the movie studios in Disney's stable keep gobbling up $175 to $250 Million per film in budgets that go God know's where. Honestly, why did Lightyear cost them $200 Million when Universal produced Minions this summer for $80 Million? Where's the missing $120 Million they spent on Lightyear?
Not to mention where all the missing ticket sales went for Lightyear, but that's a whole other story.
That can't be made up with 10 dollar a month streaming services and non-existent DVD sales.
Should we call it a Love Tap instead?
BuzzedPotatoHead89
Well-Known Member
Honest question but how much autonomy does Ken P. and TDA more broadly have to set pricing and/or policies around APs/Keys? Additionally how much sway do they have in terms of determining the scope and scale of future investment?
I would think they have some authority over the former, and significantly less over the latter. But I’m not sure. The reason I ask is because I’m not sure to what degree the board sees this as a TDA “shaming” problem vs a strategic company problem. I.e less resort-level infrastructure investment in Anaheim and a marketing strategy that has been lopsided on encouraging domestic and international travel to WDW.
Disney Irish
Premium Member
I don't see it as that either. This to me isn't calling out TDA, its a corporate decision made at the Park and Resort Chairman level not at the TDA President level.
So if anything its calling out Josh D rather than Ken P.
Wendy Pleakley
Well-Known Member
That can't be made up with 10 dollar a month streaming services and non-existent DVD sales.
It depends on the numbers. Disney is presumably putting their movies on Disney+ quickly for a reason.
If someone previously bought a Disney movie on disc every two months, and instead now pays a monthly fee for Disney+, they're breaking even.
And then there's new subscribers. People who didn't purchase movies outright very often.
Offset obviously by the costs of producing Disney+ shows that don't see any theatrical revenue.
By all accounts their business model is looking good.
They also have a good track record with quality content as opposed to quantity. Netflix is starting to suffer because they just shovel money so they can have constant new releases, and a lot of it isn't great.
That's a great question. I imagine the TDA Prez Du Jour has quite a bit of autonomy to set pricing and revenue streams, which is why there's been such a broad array of those things over the past 15 years or so. Or, heck, even since DCA opened with a thud in 2001. There's been a hundred different ticketing strategies in that time it seems.
But as for future investment, I doubt they have much sway. They just get to be the face of that investment for Anaheim City Council meetings and gushy interviews with the OC Register. It likely got approved before the TDA Prez Du Jour even worked in Anaheim, and/or it often opens long after they've left to "spend more time with family" or go back to their old job in Burbank and avoid that awful commute down to Anaheim.
Another good point. But the phrasing of the problem as "unfavorable" in a quarterly earning's report is very clear to the financial community. It's unfavorable out there at Disneyland, and thus it must be fixed.
Disneyland isn't a social services agency or a charity, it's a business.
@BuzzedPotatoHead89 another thought regarding your point about ticketing strategies...
I just realized that for the past 20 years whenever I visit Tokyo (since DisneySea opened at the same time as DCA opened), the ticketing strategy has been remarkably stable. There are only a few options, and the sole option for the 3 day ticket I almost always buy is always the same; Day 1 at one park, Day 2 at another, park-hopping only allowed on Day 3). There's a few other one and two day tickets options, plus their evening Date Nite tickets, and basically one full-fare AP available.
And it's been like that in Tokyo for decades now. I hadn't really realized that until just now.
Meanwhile, in Anaheim, they change ticketing strategies and options and promotions and names and nomenclature just as quickly as they change TDA Presidents. What they offered in Anaheim in '01 was completely different for the 50th in '05, and it had changed a half dozen times by the time the 60th rolled around in '15. Now they've got Magic Keys, or they are taking Magic Keys away, or something.
The difference in ticketing and marketing strategy between Anaheim and Tokyo is huge. And it makes it seem like Anaheim doesn't quite know what they're doing at any given moment.
I just realized that for the past 20 years whenever I visit Tokyo (since DisneySea opened at the same time as DCA opened), the ticketing strategy has been remarkably stable. There are only a few options, and the sole option for the 3 day ticket I almost always buy is always the same; Day 1 at one park, Day 2 at another, park-hopping only allowed on Day 3). There's a few other one and two day tickets options, plus their evening Date Nite tickets, and basically one full-fare AP available.
And it's been like that in Tokyo for decades now. I hadn't really realized that until just now.
Meanwhile, in Anaheim, they change ticketing strategies and options and promotions and names and nomenclature just as quickly as they change TDA Presidents. What they offered in Anaheim in '01 was completely different for the 50th in '05, and it had changed a half dozen times by the time the 60th rolled around in '15. Now they've got Magic Keys, or they are taking Magic Keys away, or something.
The difference in ticketing and marketing strategy between Anaheim and Tokyo is huge. And it makes it seem like Anaheim doesn't quite know what they're doing at any given moment.
PiratesMansion
Well-Known Member
Obviously there's been some incompetence on Anaheim's part (DCA for most of its existence, etc.), but businesses are gonna business. Disneyland's objective is to get people in the gate, and doing that however they can-the same thing governing every other business in this country. Changing strategies all the time might be annoying but doesn't to me immediately indicate that a business is failing, simply that they are trying to do anything they think might work to get people to show up (ideally, more than last quarter because this is the hill our country has decided to die on).
Conversely, if doing nothing produces continued attendance growth, or consumers are more price sensitive (as has been claimed many times regarding Japanese consumers; and speaking of recessions, Japan has never fully recovered from a recession that started in the nineties), they're not going to reinvent the wheel because it's of no benefit for them to do so.
At any rate, now is not the time to be celebrating Tokyo's ticketing wisdom when getting a multiday ticket for anyone is basically impossible there right now. Seriously, look at this link for information about how Tokyo was (is?) doing multiday ticketing (https://www.laughingplace.com/w/news/2022/03/04/tokyo-disney-resort-to-issue-limited-number-of-multi-day-visit-passports-for-summer-2022/#:~:text=The cost of a Multi,valid for 6 entries total.) Apply for multi-day tickets to visit only a certain number of times a month and almost certainly be subject to a literal ticket lottery? Like Big Band Beat but for an entire park? C'mon, that's absurd. And for all the grief about Magic Keys, Tokyo hasn't tried to bring back any APs at all.
At least in California, so long as you can get a reservation (a stupid process that Disney could certainly make easier and be more flexible with, but it's not that difficult either), you can go wild with your five day parkhoppers or whatever. During normal times, sure, Tokyo's great. Now though? I'll take a convoluted ticket system with reservations, promo deals, and comparatively minor annoyances over probably not getting a multiday ticket at all.
Disstevefan1
Well-Known Member
They just told us in the earnings call, success is not measured by “getting people in the gate” or by mere attendance for the sake of attendance. It’s all about per capita ticket revenue.