No Magic In The Numbers ...

[Dayma]

NYT reported today that park atendance dropped 5% officially and that they plan on extending offers for a few more months. They also said that the DVD releases will be trimmed down since they have had large drops in sales.

 

[Jim L Clifton]

I wish they would come down on DELUXE RESORTS.Go at value season every yr.Sig...we ALL know this will never happen!
Jim

 

[markjohns1]

Kinda hard to take advantage of stay 4, get 3 free when you're about to lose your home.

My point is that fewer and fewer people can afford to go, no matter the promos offered.

I agree with these points. To go a step further, fewer and fewer people can afford to go, no matter the attractions being built/not built, or entertainment options added/removed, or dining options being added/removed. It's tough to justify tons of investment when the chief limitation is guests' financial ability to visit, not necessarily their desire to come.

Too little too late. The biggest mistake they made was building up DVC that will be the downfall.

Why is DVC the scapegoat for everything? If it sells, why stop building? If anything, DVC is helping to keep some of those financial numbers from slipping further.

The answer is not to trim the park going experience. Okay, so they don't have to add new attractions - I'm good with that. But the cuts to the parks in terms of service/entertainment/acts/venues/dining, etc. are a cop-out. So would be canning front-line CMs.

They're doing one good thing though already, and that is booting management glut. Those are the kind of cuts that need to be made. Cuts outside of the parks. Trim down all TDO corporate staff. Shutter a resort or two. Halt all DVC development across the board. As a last resort, if attendance continues downward, implement the rolling park closure plan (for example, 1 water park open daily during weekdays, DAK & DHS each closed 2 weekdays). Is it better to go to a more crowded park that is offering full service for the same price you've been paying, or to have your choice of 4 "parks lite"?

IF THEY LEAVE EVERYTHING BETWEEN THE GATES ALONE, THEY WILL RIDE OUT THE STORM. Cuts inside the gates only crap all over your brand and admit that you want to crap all over your customers, by making them cover your backside.

Do car companies start leaving parts out on the assembly line when sales are down? Do surgeons only clean out half the clogged arteries if the network stock tumbles? Does a garbage collector only pick up half your trash when he loses 1/3 of his customers to cheaper competition?

It's a bit of a stretch to think that WDW would be in a better financial position if they would have opted to close the AKL in order to keep daily showings of Fantasmic and Four for a Dollar at the BatB show (just as an example). A lot of the cuts that have been made do not actually generate revenue. The cuts help short-term in order to "ride out the storm."

There are still unknowns at this point. How bad will the economy really get? How long will it take to recover? It's hard to say if the decisions being made currently at WDW are going to be better or worse than the ones Univeral or Sea World are making from a business standpoint. Hindsight will definitely be 20/20.

 

[imamouse]

It’s a shame TDC can’t operate on Walt’s philosophy of spending money to deliver quality, which in turn generated attendance. Of course, he nearly went bankrupt a couple of times – something that today’s shareholders would not stand for – but in the end, he usually got it right.

 

[Animaniac93-98]

Why is DVC the scapegoat for everything? If it sells, why stop building?

IF it sells, apparently it isn't with BLT and I'm guessing AK Villas isn't either. It may have sold before, but it's not a good investment now, and yet Disney builds them over new park attractions. True, the people who did buy it before will pay for them but new buyers are certainly hard to come by these days. Even with a separate budget it doesn't seem like a wise way to spend money.

 

[jakeman]

IF it sells, apparently it isn't with BLT and I'm guessing AK Villas isn't either. It may have sold before, but it's not a good investment now, and yet Disney builds them over new park attractions. True, the people who did buy it before will pay for them but new buyers are certainly hard to come by these days. Even with a separate budget it doesn't seem like a wise way to spend money.

Nothing is selling right now.

There have been no new DVC developments since the downturn. Everything that has been built was started before things got bad.

It's not a matter of "even with a seperate budget". It is a seperate budget, period. You can't lump criticism of DVC and imply that it is impacting the parks financially and not take other aspects of the company into account.

You either look at the parks by themselves or you look at the company at a whole. Picking and choosen parts that aren't financially related is folly.

 

[Animaniac93-98]

If nothing is selling why spend? They could always put construction on hold until things get better (that's what Disney did with Pop Century, they just never finished it) and spend that separate money on something else. I'm not saying DVC is causing the parks trouble, I'm just saying spending on DVCs isn't the best idea right now.

 

[jakeman]

Putting construction on hold cost money as well. Not only in potentially lost revenue, but in other constructiony things I don't know alot about.

We also don't know where the money came from or how it was paid out. This money could have been set aside 2 years ago.

 

[Duckberg]

UPbeat

Well... lets all hide in a bunker, stick our heads in a sand, don't go to the parks, don't spend money, etc......
Put a fork in them and the company is done.


Seriously though, the company has announced Mgmt fat trimming that they are going to be implementing this month, and with other changes in the non-P&R divisions, we'll see what happens. But at least Disney is still turning a profit, its just 34% smaller than last quarter.

Have some faith that the company will do what they need to continue on.

Thank you SIR :sohappy:

Duckberg

 

[Figments Friend]

South Park notwithstanding, everybody loves Canada and Canadians! We're the nicest country around! :king:

Canada Rules. ( starts singing "Blame Canada" from the South Park Movie..)

NO really, Canada is great. I love it. It is even better than the movie in the Canada Pavillion makes it out to be..

 

[Animaniac93-98]

NO really, Canada is great. I love it. It is even better than the movie in the Canada Pavillion makes it out to be..

How true that is.

 

[Mr.MouseFan]

Although things might be in the toilet right now and the knee jerk reaction is to cut back, cut back, cut back, Disney should be investing in its parks and resorts in Orlando to put themselves in a good position when this economy turns around.

When people start to have discretionary income and are looking to go to Orlando again, they are going to want to see something exciting and new. Universal will no doubt be trumpeting Wizard World of Harry Potter. What about Disney? Stitch's SuperSonic Celebration?

 

[pheneix]

Just read in a trade from Hong Kong that Disney has approached the HK government about paying their loan back in shares of the park in lieu of cash.

The problems are worse in regions beyond Orlando.

 

[markjohns1]

Although things might be in the toilet right now and the knee jerk reaction is to cut back, cut back, cut back, Disney should be investing in its parks and resorts in Orlando to put themselves in a good position when this economy turns around.

When people start to have discretionary income and are looking to go to Orlando again, they are going to want to see something exciting and new. Universal will no doubt be trumpeting Wizard World of Harry Potter. What about Disney? Stitch's SuperSonic Celebration?

It's easy to say they should be investing, but with what money? Those cuts are going to help them survive in the short-term. It's clear that things are bad, money is being lost, and it's bound to get even worse. Who knows how long it will last? If it lasts 5-10 years longer, those major expenditures at Universal may end up being quite a burden. It's great to plan for the long-term, but you have to survive short-term for any of it to matter. And really, it's not like there's no plans for WDW. There's seems to be quite a few rumors floating around about additions over the next several years.

When people have been facing a loss of job, home, and who knows what else, I think when the economy turns around they will just be happy to take any kind of a vacation. I don't think the general population is going to worry too much about the types of steaks being served in the restaurants. WDW can probably survive for quite a while on reputation alone.

 

[MousDad]

I don't think the general population is going to worry too much about the types of steaks being served in the restaurants. WDW can probably survive for quite a while on reputation alone.

Despite the hyperbole of my earlier post, I still think that they should figure out a way to balance short term operating losses with cuts that do not diminish the core product.

Sure they can survive on reputation, but is it worth the risk? There's bound to be a certain portion of the customer base that either a) might have knowledge of cuts affect their decisions to attend or how long to attend, or b) those who are not aware of the cuts ahead of time have them negatively influence their plans for a future visit.

I would venture to say also that alot of the cuts are getting past the "noticeable by fanboy vision only" stage to the "noticeable by the general public" stage. Fantasmic would be a prime example of that.

 

[jakeman]

Despite the hyperbole of my earlier post, I still think that they should figure out a way to balance short term operating losses with cuts that do not diminish the core product.

Sure they can survive on reputation, but is it worth the risk? There's bound to be a certain portion of the customer base that either a) might have knowledge of cuts affect their decisions to attend or how long to attend, or b) those who are not aware of the cuts ahead of time have them negatively influence their plans for a future visit.

I would venture to say also that alot of the cuts are getting past the "noticeable by fanboy vision only" stage to the "noticeable by the general public" stage. Fantasmic would be a prime example of that.

Perhaps we are at that point now. If you (not you personally) can step back and take a look at the big picture, globally and not just the resort itself, the picture is pretty bleak. Not hopeless, but most folks aren't exactly farting sunshine and rainbows right now.

If one can look at the numnber objectively, without all the fan boy angst that is associated with the parks, maybe we are to the point where the only cuts left that would have any impact are ones that are starting to affect the guest experience.

Perhaps F! isn't about AI or greed or the fact that the company hates you personally, but that they need to save money at this point and that was the most cost effective way to do it.

Just a senario, F! to two nights a week or 100 CM are laid off? You pick. The easy choice is the labor. There are probably 100 front line CM that can be canned without it affecting the overall experience. Not saying this was what happened, but it could be a possibility.

 

[DisneyMusician2]

Perhaps we are at that point now. If you (not you personally) can step back and take a look at the big picture, globally and not just the resort itself, the picture is pretty bleak. Not hopeless, but most folks aren't exactly farting sunshine and rainbows right now.

If one can look at the numnber objectively, without all the fan boy angst that is associated with the parks, maybe we are to the point where the only cuts left that would have any impact are ones that are starting to affect the guest experience.

Perhaps F! isn't about AI or greed or the fact that the company hates you personally, but that they need to save money at this point and that was the most cost effective way to do it.

Just a senario, F! to two nights a week or 100 CM are laid off? You pick. The easy choice is the labor. There are probably 100 front line CM that can be canned without it affecting the overall experience. Not saying this was what happened, but it could be a possibility.

This certainly has a ring of truth to it. And perhaps that makes me an apologist, but I don't think that makes this argument any less valid.

 

[markjohns1]

Despite the hyperbole of my earlier post, I still think that they should figure out a way to balance short term operating losses with cuts that do not diminish the core product.

Sure they can survive on reputation, but is it worth the risk? There's bound to be a certain portion of the customer base that either a) might have knowledge of cuts affect their decisions to attend or how long to attend, or b) those who are not aware of the cuts ahead of time have them negatively influence their plans for a future visit.

I would venture to say also that alot of the cuts are getting past the "noticeable by fanboy vision only" stage to the "noticeable by the general public" stage. Fantasmic would be a prime example of that.

I think that balance is definitely what they need to go for. I'd love it if they weren't cutting from the park experience. As jakeman pointed out, maybe the cuts they are making now are their only options short of laying off CMs or other drastic options. This type of economic situation is uncharted territory for everyone.

Surviving on reputation is definitely a risk, no question about that. Major investments in the parks would be too. Shuttering hotels or even the parks themselves temporarily or permanently would be too. It's hard to say which risk is financially worth it.

 

[Mr.EPCOT]

farting sunshine and rainbows

I would possibly pay to see this happen literally.

 

[prberk]

Anyone else noticed that WDW seems to be putting banner ads everywhere on the internet? Even the local high school webpages have them here....

So, maybe they are using more advertising than usual, and in more places, to help get attendance up.

Paul