Is attendance really down at WDW this or…

[Sirwalterraleigh]

The problem is that those same people who put luxuries on their credit cards are now maxing them out on necessities. There's no room on the Mastercard for an expensive Disney vacation when you need the available credit for food and gasoline.

It was a blip on News…if such a thing exists…on Thursday

For the first time ever more people are carrying balances on cards each month than paying them off. Crossed the rubicon after 50 years

A few days before that it was revealed that bankers officially said that the $2,000,000,000,000 in Covid era injection was spent. It’s gone statistically.

None of these things combined with more headline factors about interest, inflation, college debt (that’s a bigtime problem hatching in 45 days…inbound) are good if you rely on non-necessity consumption

I can think of a company or two that fits that description rather well:

 

[Tha Realest]

It was a blip on News…if such a thing exists…on Thursday

For the first time ever more people are carrying balances on cards each month than paying them off. Crossed the rubicon after 50 years

A few days before that it was revealed that bankers officially said that the $2,000,000,000,000 in Covid era injection was spent. It’s gone statistically.

None of these things combined with more headline factors about interest, inflation, college debt (that’s a bigtime problem hatching in 45 days…inbound) are good if you rely on non-necessity consumption

I can think of a company or two that fits that description rather well:

How much does their intransigence on cutting rack rates on tickets/rooms and instead induce through discounts start to bite them? Mind you, all that happens before you start piling on the seemingly necessary add ons (G+, ILL)

 

[Miss Bella]

The economy has slowed quite a bit and folks are cutting back on discretionary spending. Vacations are the first thing to go. Next, streaming services and movie theatre outings.

Not a good time for companies like Disney.

Explains why I just cancelled HBO max. I agree next year may be a year for good discounts.

 

[Miss Bella]

It was a blip on News…if such a thing exists…on Thursday

For the first time ever more people are carrying balances on cards each month than paying them off. Crossed the rubicon after 50 years

A few days before that it was revealed that bankers officially said that the $2,000,000,000,000 in Covid era injection was spent. It’s gone statistically.

None of these things combined with more headline factors about interest, inflation, college debt (that’s a bigtime problem hatching in 45 days…inbound) are good if you rely on non-necessity consumption

I can think of a company or two that fits that description rather well:

I’m no economist, but apparently the money supply is decreasing at the fastest pass ever. That’s not a good sign for the economy or Disney I would think.

 

[Sirwalterraleigh]

I’m no economist, but apparently the money supply is decreasing at the fastest pass ever. That’s not a good sign for the economy or Disney I would think.

At some point, everyone can’t spend more because things cost more

I heard that on Sesame Street and they never lie

 

[Miss Bella]

At some point, everyone can’t spend more because things cost more

I heard that on Sesame Street and they never

Very true.

 

[JoeCamel]

I’m no economist, but apparently the money supply is decreasing at the fastest pass ever. That’s not a good sign for the economy or Disney I would think.

Well they increased the money supply at the fastest pace ever so it balances? Yeah, the Fed is reducing it's balance sheet as fast as they can

 

[Sirwalterraleigh]

Well they increased the money supply at the fastest pace ever so it balances? Yeah, the Fed is reducing it's balance sheet as fast as they can

It’s pretty fascinating…they’re trying to Eliminate what we know as a “traditional recession” by spreading all the economic weakness out over everyone and everything


…which makes sense if you’re in Chicago or stanford…but my Princeton homies up the street would say it may just amp up the catastrophe ?

Strange days

 

[JoeCamel]

It’s pretty fascinating…they’re trying to Eliminate what we know as a “traditional recession” by spreading all the economic weakness out over everyone and everything


…which makes sense if you’re in Chicago or stanford…but my Princeton homies up the street would say it may just amp up the catastrophe ?

Strange days

Certainly a time for the textbooks. They are taking a cue from the past recessions and brewing a new/old response which against all odds seems to be working in the short term. The name Powell may go down in history with Keynes

 

[Miss Bella]

Well they increased the money supply at the fastest pace ever so it balances? Yeah, the Fed is reducing it's balance sheet as fast as they can

When you do things too fast things break.

 

[networkpro]

Certainly a time for the textbooks. They are taking a cue from the past recessions and brewing a new/old response which against all odds seems to be working in the short term. The name Powell may go down in history with Keynes

At least with Keynes depression economics, you have the public works infrastructure creation.

 

[Sirwalterraleigh]

Certainly a time for the textbooks. They are taking a cue from the past recessions and brewing a new/old response which against all odds seems to be working in the short term. The name Powell may go down in history with Keynes

I’m sorry…you said Keynes but I bet you meant “the next Alan Keyes”?

 

[Willmark]

Well they increased the money supply at the fastest pace ever so it balances? Yeah, the Fed is reducing it's balance sheet as fast as they can

You mean making the money printing machine go “bbbbbrrrrrrrr” has real life consequences?

Shocking

 

[Disstevefan1]

The costs are far outpacing the wages…period.

Add to that the stock market is pretty much duct taped together and is already down a lot…

You can’t pay for everything to go up. And if you do…you aren’t really the core wdw traveler. Better places with better restaurants for that kinda scratch

I used to think for every person or family Disney prices out that there are folks coming to more than take their place.

My theory always depended on attendance going up.

Now that attendance is going down........ My theory does not work.

 

[AEfx]

You can’t pay for everything to go up. And if you do…you aren’t really the core wdw traveler. Better places with better restaurants for that kinda scratch

And that's really the crux here.

The audience who can afford vacations regularly at current WDW prices can also afford to go to practically any other tourist destination on the planet.

It's kind of absurd to think they were going to keep going back to WDW, when they have so many options. Even if the "magic" was in full force (and it certainly isn't these days) it's doubtful at the current price points people would continue to regularly choose WDW - why come to see World Showcase again when you can actually go to Europe for real?

 

[Grimley1968]

And that's really the crux here.

The audience who can afford vacations regularly at current WDW prices can also afford to go to practically any other tourist destination on the planet.

It's kind of absurd to think they were going to keep going back to WDW, when they have so many options. Even if the "magic" was in full force (and it certainly isn't these days) it's doubtful at the current price points people would continue to regularly choose WDW - why come to see World Showcase again when you can actually go to Europe for real?

This puts WDW in a really tough spot. There's probably a microeconomics term for the cycle they're in, but I wasn't very good at microeconomics in college.

Basically, they've priced out all but higher income people who weren't upset at the prices continuing to rise as long as value increased as well. Value arguably did increase for many years, I'd argue until around the advent of FP+. Now, for several years the value of a WDW vacation has decreased, while prices have continued to rise. So even higher income people have a tougher time paying it, so they'll look for better value elsewhere, even if it costs them the same.

At some point, and maybe by now, WDW profits have to take a hit. Hopefully, Disney will realize they need to work on WDW's value as a vacation again, while simultaneously keeping prices under control, all while inflation continues to impact the economy until an inevitable recession. They put themselves in this spot, but I do not envy their position.

For example, adding Skyliner to the EPCOT/DHS area (IMO) greatly increased the value of a WDW vacation if staying in one of the affected resorts (the exception to the rule), but I don't know that it did anything to increase park traffic, although it might have solidified some bookings at Pop Century/AoA. They need to do more things like this that add value to the property and to people's WDW vacations, but in this economy I don't know that they'll get a return on investment for many years to come. If they don't do more things like this, though, I think the bleeding continues.

 

[Sirwalterraleigh]

This puts WDW in a really tough spot. There's probably a microeconomics term for the cycle they're in, but I wasn't very good at microeconomics in college.

Basically, they've priced out all but higher income people who weren't upset at the prices continuing to rise as long as value increased as well. Value arguably did increase for many years, I'd argue until around the advent of FP+. Now, for several years the value of a WDW vacation has decreased, while prices have continued to rise. So even higher income people have a tougher time paying it, so they'll look for better value elsewhere, even if it costs them the same.

At some point, and maybe by now, WDW profits have to take a hit. Hopefully, Disney will realize they need to work on WDW's value as a vacation again, while simultaneously keeping prices under control, all while inflation continues to impact the economy until an inevitable recession. They put themselves in this spot, but I do not envy their position.

For example, adding Skyliner to the EPCOT/DHS area (IMO) greatly increased the value of a WDW vacation if staying in one of the affected resorts (the exception to the rule), but I don't know that it did anything to increase park traffic, although it might have solidified some bookings at Pop Century/AoA. They need to do more things like this that add value to the property and to people's WDW vacations, but in this economy I don't know that they'll get a return on investment for many years to come. If they don't do more things like this, though, I think the bleeding continues.

What really happened…I believe…is somewhere in this blue ocean nonsense ten years ago (in burbank…conscious or not…) the decision was made to disregard the traditional pricing safeguards at parks.

It was never “cheap”…but there was a safeguard on prices so they never got within about 20% of the “ripoff Cliff”

Well I believe they dumped it and went over…with disastrous consequences developing.

Sometime the “old way” didn’t need to change.

 

[GimpYancIent]

What really happened…I believe…is somewhere in this blue ocean nonsense ten years ago (in burbank…conscious or not…) the decision was made to disregard the traditional pricing safeguards at parks.

It was never “cheap”…but there was a safeguard on prices so they never got within about 20% of the “ripoff Cliff”

Well I believe they dumped it and went over…with disastrous consequences developing.

Sometime the “old way” didn’t need to change.

Huge dilemma for management, how can the pricing model be reconfigured down to reasonable levels where it's no longer akin to price gouging and fleecing the guests? Hard to walk it back after going in this deep.

 

[Sirwalterraleigh]

Huge dilemma for management, how can the pricing model be reconfigured down to reasonable levels where it's no longer akin to price gouging and fleecing the guests? Hard to walk it back after going in this deep.

Once a consumer product gets labeled a ripoff…it’s essentially done.

So if that’s what their data is telling them (there’s whispers out there)…you better change that before it sinks you ASAP. Tie it off…

Hard pivot back to the core and middle class…pack the place before it’s too late.

What’s the easiest way to do that?
New management. Easy question to answer.

 

[Tha Realest]

Once a consumer product gets labeled a ripoff…it’s essentially done.

So if that’s what their data is telling them (there’s whispers out there)…you better change that before it sinks you ASAP. Tie it off…

Hard pivot back to the core and middle class…pack the place before it’s too late.

What’s the easiest way to do that?
New management. Easy question to answer.

I agree. But.

There are some structural problems to that. How do they turn off the revenue spigot from easy solutions like G+ and ILL? How do they cut back from $159/single day variable to, say, $109 WW h day of the year? How do they cut rack rates at the resorts? Their IT is so funky I have no trust the discount pricing shows consistently, leading to stick shock.