Is Disney Pricing themselves out of the Middle Class???

[I_heart_Tigger]

Here's a real life comparison. Last year (2012) I took 2 vacations - a 10 day Disney/Universal trip which I spent a total of $3500 (my portion)

a 13 day trip to England, Scotland, Ireland and France - my portion total cost was $3200

yup - cost me $300 more for the shorter trip to Disney. Though accomodations in the UK ranged from nice hotels to small B&B's so it's hard to give a completely accurate comparison but you get the idea.

 

[Skippy's Pal]

Congress will soon step in and start their debates on ticket prices. They will spend hours debating this and try to freeze ticket prices for the middle class and raise them on the upper class. They will then decide to do nothing and kick it over to the Senate. From there, nothing will get done until the Vice President negotiates with the minority party in the Senate until a compromise is reached. It will then get kicked back to the House where they will delay a vote for two months and decide to try again. In the end, nothing will change. I guess I should have started my paragraph with the previous sentence.

Ah! The "Disney Cliff!"

 

[awoogala]

Well, they are pricing themselves out of loyal and repeat customers. most people I talk to with kids these days consider WDW a "one time thing"..something "you have to do once" before they grow up. A big, expensive, one time only thing.
WDW used to be the premier spot for yearly family vacations, but I think the tide is turning, and they are seeing this, and catering to the once in a lifetime types.
The rest of us they are trying to sucker into dvc.

 

[EOD K9]

Well, they are pricing themselves out of loyal and repeat customers. most people I talk to with kids these days consider WDW a "one time thing"..something "you have to do once" before they grow up. A big, expensive, one time only thing.
WDW used to be the premier spot for yearly family vacations, but I think the tide is turning, and they are seeing this, and catering to the once in a lifetime types.
The rest of us they are trying to sucker into dvc.

<~~~~~~Was suckered back in '05 but don't regret it.

 

[draybook]

Thus the reason we go during Free Dining. Our package was a little over 2300 this last September.

 

[rob0519]

Right now a trip to WDW is "affordable", same price as going to Europe would be roughly, but it keeps increasing yearly, tickets, hotels, food, etc. Right now for a week for a family of four it will cost about 5000.00 roughly to go to WDW to stay in a moderate resort. Their are great options at the Value Resorts to save some of this and get down to 3000.00 to 3500.00 for the week. Now I understand a lot of families can afford this, but with the cost of living rising dramatically, free lending dimishing, and the increasing taxes looming, does WDW have a situation on their hands where in 5-10 years, they will be just too expensive (one WDW vacation is the price of a beach and mountain vacation) to where they will lose guest? My answer is yes, and they need to examine where they charge the higher expenses. I am not saying lower prices, but WDW needs to put a freeze on ticket, food, and value resort prices, otherwise a great deal of their customers may find it unaffordable. Your thoughts?

Well, having done over 20 trips since 1996, I would have to say yes, they are pricing out the middle, lower middle classes and everyone below. Amazingly, the parks are still crowded, occupancy is high and the management has the confidence to keep building (GF_DVC). Until they see a downturn in capacity, they will keep increasing prices to keep up the "value to their shareholders".

We are a family of five and were fortunate enough to go once maybe twice a year. Then it became once every 18 months, then once every 12 months, now we're lucky if we can afford every other year. Ten day trips became seven day trips, then 5 day trips.

I don't think WDW will lose first time guests. People will still save and save for that once in a lifetime vacation. What I do think they will lose are those guests that used to come every year and will now be only able to afford to come every two or three years.

 

[Mori Anne]

Yup, IMHO they sure are!

 

[CP_alum08]

I think so. If we didn't live as close as we do (<2 hours) we absolutely would have to start questioning trips to WDW. It's sad really.

 

[miles1]

In our view Disney has already shot themselves in the foot with the price increases. In past years our family of four stayed in a moderate resort and ate most, if not all, meals in the parks. Then we'd visit DTD or PI in the evenings. Last trip, in 2010, we rented a condo offsite at ate most meals off property, and saved a bunch of money. We only shopped at DTD one evening. We all agreed it was one of the best trips we've had. So they may have made some money on the gate price, but they've lost our dining, lodging, and shopping dollars. And, I'm not so sure we'd go back to staying on site, even if we could afford it.

 

[luv]

Disney will keep raising prices until people stop paying them.

If Americans can't afford it any longer, they'll get their customers elsewhere.

When nobody can afford it and everyone gives up on them, they'll try lowering the prices.

 

[Bolna]

If Americans can't afford it any longer, they'll get their customers elsewhere.

However, the further away people are the more they are going to be affected by the raise in the cost of air travel. And so far it does look like a safe bet that air travel won't become cheaper in the coming years.

Also, at the moment the US Dollar exchange rates work in favour of many foreign visitors. However, that can change. And suddenly a trip to the US will come with an automatic 10% or 25% price increase just because of a change in exchange rate.

Foreign visitors are far from being a safe strategy to rely on.

 

[Figgy1]

Right now a trip to WDW is "affordable", same price as going to Europe would be roughly, but it keeps increasing yearly, tickets, hotels, food, etc. Right now for a week for a family of four it will cost about 5000.00 roughly to go to WDW to stay in a moderate resort. Their are great options at the Value Resorts to save some of this and get down to 3000.00 to 3500.00 for the week. Now I understand a lot of families can afford this, but with the cost of living rising dramatically, free lending dimishing, and the increasing taxes looming, does WDW have a situation on their hands where in 5-10 years, they will be just too expensive (one WDW vacation is the price of a beach and mountain vacation) to where they will lose guest? My answer is yes, and they need to examine where they charge the higher expenses. I am not saying lower prices, but WDW needs to put a freeze on ticket, food, and value resort prices, otherwise a great deal of their customers may find it unaffordable. Your thoughts?

As much as I love Disney it takes careful budgeting to make the trip. Staying off sight in a condo 4br kitchen 3 bath same price as a value and I don't have to share a room with my children. It came down to comfort at night and being able to eat breakfast at "home". My boys are comando style open to close so I can't see paying for resort or room theming. I want to stay on sight BUT I really can't afford it. 12 nights in 1 room I love my boys but that's a littlte close for comfort We'd rather go every 2 yrs or so because transportation every year would force us to shorten our trip to 4 or 5 days.10 days in the parks and 1 shopping day DTD and the outlets I go home nice and relaxed. Sorry for the venting.

 

[ParentsOf4]

Disney will keep raising prices until people stop paying them.

If Americans can't afford it any longer, they'll get their customers elsewhere.

When nobody can afford it and everyone gives up on them, they'll try lowering the prices.

WDW attendance has dropped in 2 of the last 3 years while exploding at Universal. People still vacation if they feel they are getting their money's worth.

WDW hotel occupancy rates are down to 78%, the lowest they've been since the post-9/11 period.

As mentioned during the 2012 financial review conference call, WDW attendance would be down a lot more if it weren't for increased attendance from Argentina, Brazil, and the U.K.

All signs are that as WDW squeezes tighter, more people are slipping through their fingers.

 

[Ginzuishou]

I spent 5 days in Disney (in 2003)and it cost me around $700.00, which included 5 days at any park, moderate hotel, and airfare. I wonder how much it would be in 2013.

 

[real mad hatter]

For us,two weeks staying onsite at a moderate resort!and getting free DDP is the same cost as two weeks at A/I in Cyprus.

 

[neoshinok]

Eventually, yes, and it is sad.

To quote Jurassic Park's very own John Hammond: "This park was not built to cater only for the super-rich."

Followed up by the lawyer: "Well, we'll have a coupon day...or something."

 

[WED99]

I think what is the most upsetting thing is that all the extra cash Disney are making by raising prices is not being put back into the park communities in the ways necessary. Sure they did great with NFL and are trying to enhance guests experience with NextGen, but lets do the math here...

If everyone were to buy a 5-Day ticket, that's about $95 a day. MK has an average of 44,000 guests per day.
44,000 x $95 = $4,180,000 per day
Now I don't work for Disney, so I have no clue how much expenses cost so I'm going to assume a profit of about 20% is made each day.
20% of $4,180,000 is $836,000 in profit
Then once you take into account merchandise/food sold, hotel rooms, parking and all the other 3 parks, I'm estimating about a 3-4 million dollar profit per day! (I'm probably way off, this is a lot of estimating)
So in a 30 day month, Disney have profited $105,000,000
If they invested 50% of that into the parks, that's $52,500,000 per month
So in the time it would take to design a new imagination pavilion or a speedway re-theme or even a whole new land for DHS, they would already have the money in the budget to build it in Disney style! By doing this, they could constantly have something being done at each park non-stop! And it would be a wise business choice because people would flood the parks to see the new additions, just as Potter proved!

Sorry to go crazy with the math on you guys, just wanted to show what I think should be done. Maybe one day I'll be CEO

 

[Alison1975]

Thus the reason we go during Free Dining. Our package was a little over 2300 this last September.

Bounceback.. 14 nights of free dining at a moderate for 5 people ( 3 of whom are adults or disney adults) less than $4900..

 

[powlessfamily4]

I think what is the most upsetting thing is that all the extra cash Disney are making by raising prices is not being put back into the park communities in the ways necessary. Sure they did great with NFL and are trying to enhance guests experience with NextGen, but lets do the math here...

If everyone were to buy a 5-Day ticket, that's about $95 a day. MK has an average of 44,000 guests per day.
44,000 x $95 = $4,180,000 per day
Now I don't work for Disney, so I have no clue how much expenses cost so I'm going to assume a profit of about 20% is made each day.
20% of $4,180,000 is $836,000 in profit
Then once you take into account merchandise/food sold, hotel rooms, parking and all the other 3 parks, I'm estimating about a 3-4 million dollar profit per day! (I'm probably way off, this is a lot of estimating)
So in a 30 day month, Disney have profited $105,000,000
If they invested 50% of that into the parks, that's $52,500,000 per month
So in the time it would take to design a new imagination pavilion or a speedway re-theme or even a whole new land for DHS, they would already have the money in the budget to build it in Disney style! By doing this, they could constantly have something being done at each park non-stop! And it would be a wise business choice because people would flood the parks to see the new additions, just as Potter proved!

Sorry to go crazy with the math on you guys, just wanted to show what I think should be done. Maybe one day I'll be CEO

Did you factor in healthcare and lawsuits? Opps... there goes the profit!

 

[PhilharMagician]

I spent 5 days in Disney (in 2003)and it cost me around $700.00, which included 5 days at any park, moderate hotel, and airfare. I wonder how much it would be in 2013.

Yeah I was looking last night myself at the cost of my families trip in 2003 which was the last trip I where I paid for a room instead of DVC. I spent $2400 total for 8 nights including airfare from upstate NY, rental car, food, lodging @ CSR, park (tickets W/hopper and water parks) and souveniers. The trip came out to $300 per night.

In October 2011 we spent just under $3500 for 13 nights not including our room (studio) since we are DVC. That was food using TIW card, airfare, MNSSHP tickets and a towncar so we could stop at the grocery store and save money on food. Now if you include 1/2 the cost for the AP we bought the trip prior in Dec 2010 and our maintenance fees and 1/2 the cost of the TIW card we actually spent $5190 or $399 per night using every cost cutting measure I could. The differance between $300 per night (8 years ago) and $399 in 2011 is only 25%, but that differance is really much larger when you look at using TIW and saving 20% on food and DVC discounted AP split over 2 trips, no rental car and DVC for my room . To better compare, if I took the same trip now as I did in 2003 staying @ CSR for $179.00 (assuming discounted rate since rack rate is @ $189-$279 per night) and figure in the AP and rental car and no TIW, my cost per day would be approx $560 per day for my family.


My daughter is in High School and we will be taking a break from WDW for at least the next 4 years until she is out and it may be longer unless I hit the lottery or Disney realizes that they need to keep their pricing in line with the economy. I certainly do not feel they should price themselves to the point to where they loose money, but to increase prices at almost 10x the rate of the cost of living in the US is simply unacceptable in my book for what they have given back.