Spirited News & Observations II -- NGE/Baxter

[GoofGoof]

Just asking - how would WDW have managed a WWOHP?
Uni had a giant leg up in that they repurposed the existing Dueling Dragons (soooo much better when they actually dueled, but I digress) and the Flying Unicorn.
Am I correct that only the shops and Forbidden Journey are new?
Where would Disney have built WWOHP and which existing attractions were available for repurposing? Would WDW not have had to start from scratch - an infinitely more expensive proposition?

They already have a castle...could have been a good start.

 

[SirOinksALot]

According to TEA, the year before WWOHP opened (2009), IOA attendance was 4.627M. The first full year after it opened (2011), IOA was 7.674M. By any measure, 66% theme park attendance growth in 2 years is phenomenal.

The thing that everyone conveniently forgets is that the "phenomenal" growth was preceded by years of tanking. IOA's previous attendance record was from 2004. Between then and Potter, they consistently lost visitors. It took The Greatest Park Addition in the History of Mankind(TM) to ... get back to where they should have been all along - 3% annual growth from the previous peak.

It's pretty sobering when you look at how poorly Universal has performed long-term. Since the post-9/11 travel hit, WDW attendance growth rate is nearly triple that of Universal (seriously... 2004-2011). The single year attendance record for a Universal park still stands from 15 years ago.

Universal on the whole will be flat this year. They had 4% park revenue growth and the annual report called out the attendance gain being primarily from Transformers in Hollywood. Any gains at IOA will be offset by the losses at USF. People love to praise how fast Transformers went up - the words I heard were "we couldn't afford to have another summer like the last one." Ouch. Taking Jaws out of that park was a big blow.

 

[ParentsOf4]

The thing that everyone conveniently forgets is that the "phenomenal" growth was preceded by years of tanking. IOA's previous attendance record was from 2004. Between then and Potter, they consistently lost visitors. It took The Greatest Park Addition in the History of Mankind(TM) to ... get back to where they should have been all along - 3% annual growth from the previous peak.

It's pretty sobering when you look at how poorly Universal has performed long-term. Since the post-9/11 travel hit, WDW attendance growth rate is nearly triple that of Universal (seriously... 2004-2011). The single year attendance record for a Universal park still stands from 15 years ago.

Universal on the whole will be flat this year. They had 4% park revenue growth and the annual report called out the attendance gain being primarily from Transformers in Hollywood. Any gains at IOA will be offset by the losses at USF. People love to praise how fast Transformers went up - the words I heard were "we couldn't afford to have another summer like the last one." Ouch. Taking Jaws out of that park was a big blow.

Universal's attendance was relatively flat through 2008. Then it declined 12% in 2009 due to the poor economy and guests putting off visits in anticipation of WWOHP. 2012 attendance should be flat for Universal. Many already are putting off their next Universal visit until the opening of WWOHP2. That's the downside to everyone knowing you're building exciting new attractions.

WDW doesn't have that problem. WDW's attendance has been essentially flat for about 5 years. Why put off a visit to WDW when they aren't building something worth waiting for?

WDW's flat attendance has been propped up by a steady stream of discounts (something WDW almost never resorted to in the past) and a large increase in overseas attendance.

Burbank is not completely clueless and has realized that it needs to invest in something other than a (not so) "New Fantasyland" and MyMagic+ in order to see substantial revenue growth. Get ready DHS!

It's unfortunate my kids are going to finish their teenage years before WDW gets around to opening something that's worth a special visit.

Meanwhile, at Universal, they'll have opened an amazing array of exciting attractions during my children's formative years while simultaneously improving overall quality. At WDW, well, we all know what's been happening at WDW lately.

 

[Darth Sidious]

Now I think Disney is mismanaging money at P&R domestically. Spending the money they do on nonsense bloggers is ridiculous and I'd love to see what their internal numbers show for how that actually pays off. Then you look at their ridiculously high operative costs, for which they seemingly do not get what they pay for. There needs to be serious culture change and restructuring at WDW. They are missing the cleanliness, quality and friendliness of the past. CM are still extremely polite and annoy able but it still could be better. Parks can and should be spotless, no burnt out light bulbs, no broken animatronics, no chipped paint.

 

[MattM]

Now I think Disney is mismanaging money at P&R domestically. Spending the money they do on nonsense bloggers is ridiculous and I'd love to see what their internal numbers show for how that actually pays off. Then you look at their ridiculously high costs, for which they seemingly do not get what they pay for.

How much do you think it actually "costs" Disney to give away these hotels, food, etc? It's all in their budget. Every company does it. It's no different than a TV ad buy, or Internet ads. It's another form of marketing. Actually, it's significantly cheaper than the other two.

 

[Darth Sidious]

How much do you think it actually "costs" Disney to give away these hotels, food, etc? It's all in their budget. Every company does it. It's no different than a TV ad buy, or Internet ads. It's another form of marketing. Actually, it's significantly cheaper than the other two.

Exactly... In their budget means it was paid for. Something being budgeted has zero correlation as to whether or not the money was well spent. Budgeting means money was allocated for this and my point is how effective is that... I'm interested in their cost-benefit analysis for wining and dining these people. Is it cheaper than ad buys, yes but where did I ever say it wasn't?

The high operative costs and blogger costs are just two examples of wasteful spending.

 

[George]

If they're flying people in and putting them up and the Grand Floridian I hope they actually have something to announce.

It's all marketing. Nothing more, nothing less. I agree with the sentiment that it is ineffective marketing at that.

 

[ParentsOf4]

How much do you think it actually "costs" Disney to give away these hotels, food, etc? It's all in their budget. Every company does it. It's no different than a TV ad buy, or Internet ads. It's another form of marketing. Actually, it's significantly cheaper than the other two.

Disney spends about $2B annually on advertising, placing it in the top 10 of all advertisers. A large chunk of that, perhaps as much as half, is spent on non-traditional forms of advertisement.

Incrementally, the cost of comping a group of bloggers is small but, taken as a whole, the cumulative effect of this type of marketing certainly would be enough to do some wonderful things at WDW.

 

[Goofyernmost]

It's all marketing. Nothing more, nothing less. I agree with the sentiment that it is ineffective marketing at that.

I hate to disagree with you, due to your "liking" me and all, but, I don't think it is nearly as ineffective as one might believe. Other then the obvious one of getting hard and fast fans back in the parks it also encourages others to start up I love Disney sites in hopes of getting a chance at the same thing. The more blogs the more the message gets out and it is a basic marketing biblical belief that word of mouth is the strongest of all promotion. As I stated before, when you run the actual cost numbers, it is not really what you think it might be. Consider that the rooms they are giving away are empty anyway, now they are a tax deduction. Food, consider the markup on food. Almost no costs. Park entry? Doesn't cost them a cent but yet another tax deduction. Airfare...that might get costly, but I'm sure that Disney has a deal with one or more airlines for major discounted ticket thus filling those empty seats on an airplane. It is actually, in my mind, a pretty good investment.

I wouldn't go so far as to say that it has the return that a new ride would produce, coupled with massive promotion, but, for it's purpose I feel pretty confident that it more than pays for itself.

Now if you'll excuse me I must find out what it would take to start up my own blog. Disney is the greatest thing to ever happen to the world or even the universe for that matter, so I have this overwhelming urge to spread the word and hope that I can be given, I mean have the opportunity to enlighten.

 

[MattM]

Exactly... In their budget means it was paid for. Something being budgeted has zero correlation as to whether or not the money was well spent. Budgeting means money was allocated for this and my point is how effective is that... I'm interested in their cost-benefit analysis for wining and dining these people. Is it cheaper than ad buys, yes but where did I ever say it wasn't?

The high operative costs and blogger costs are just two examples of wasteful spending.

I asked this question earlier, and nobody responded. But if the general tone on this board is that Disney is just a heartless profit seeking corporation that only does things that make them money, don't we have to assume that spending money on the bloggers generates a acceptable return?

Also, I never said you didn't say that ad buys were or were not cheaper. I'm submitting to you that there is no difference in spending money on ad buys vs spending money on bloggers. They see a return or they wouldnt do it.

 

[Funmeister]

I hate to disagree with you, due to your "liking" me and all, but, I don't think it is nearly as ineffective as one might believe. Other then the obvious one of getting hard and fast fans back in the parks it also encourages others to start up I love Disney sites in hopes of getting a chance at the same thing. The more blogs the more the message gets out and it is a basic marketing biblical belief that word of mouth is the strongest of all promotion. As I stated before, when you run the actual cost numbers, it is not really what you think it might be. Consider that the rooms they are giving away are empty anyway, now they are a tax deduction. Food, consider the markup on food. Almost no costs. Park entry? Doesn't cost them a cent but yet another tax deduction. Airfare...that might get costly, but I'm sure that Disney has a deal with one or more airlines for major discounted ticket thus filling those empty seats on an airplane. It is actually, in my mind, a pretty good investment.

I wouldn't go so far as to say that it has the return that a new ride would produce, coupled with massive promotion, but, for it's purpose I feel pretty confident that it more than pays for itself.

Now if you'll excuse me I must find out what it would take to start up my own blog. Disney is the greatest thing to ever happen to the world or even the universe for that matter, so I have this overwhelming urge to spread the word and hope that I can be given, I mean have the opportunity to enlighten.

I agree with you to a point. The strategy you mention works but giving bloggers a free trip like that is way overkill to win positive reviews.

The problem with positive Disney blogs are the people who read them are already sold on Disney. The blogs are "great" to give tips and information to guests who have already decided to go to the resort. I cannot imagine too many people who are on the fence about going to WDW or Europe or Yellowstone are swayed by a new hidden Mickey in the Little Mermaid rockwork or showtimes for the EPBOTS (or whatever new "cutting edge" entertainment they are offering these days?).

I think the money spent on these marketing weekends (even though could be considered minimal investment by some) should be spent on attracting new guests not feeding online pep rally's. With this said, I honestly believe this marketing strategy is more ineffective than most believe.

Why spend the money on people who are not necessarily helping gain NEW visits and just giving tips to existing vacations?

 

[George]

I wouldn't go so far as to say that it has the return that a new ride would produce, coupled with massive promotion, but, for it's purpose I feel pretty confident that it more than pays for itself.

Now if you'll excuse me I must find out what it would take to start up my own blog. Disney is the greatest thing to ever happen to the world or even the universe for that matter, so I have this overwhelming urge to spread the word and hope that I can be given, I mean have the opportunity to enlighten.

Incrementally, the cost of comping a group of bloggers is small but, taken as a whole, the cumulative effect of this type of marketing certainly would be enough to do some wonderful things at WDW.

You guys are probably correct, but here is my non-expert/don't know anything about the topic thinking. I would assume that the thing that is hard to measure with all types of marketing is behavioral change. Would the person have bought the car even without the ad. My gut tells me that the people who read these blogs would be coming to WDW, since I think the discovery of one of these sites is an active thing (i.e. you have to have reason to seek out a blog about WDW and get advice from it). I'd be real curious to see how numbers/impact from this type of thing is calculated. I agree 100% with the idea that the cost of this is essentially nothing for Disney, so even if the impact is essentially zero, it is fine. ....On Gooyernmost's big point, I think everyone is starting a blog now. I'm thinking of just cutting and pasting select posts from magic, I'll have to be careful though. I don't want people worried about the legendary monster that lives in WS lagoon.

 

[George]

Also, I never said you didn't say that ad buys were or were not cheaper. I'm submitting to you that there is no difference in spending money on ad buys vs spending money on bloggers. They see a return or they wouldnt do it.

Or they think they get something out of it. I'd really like to know how they calculate this. Do they ask the bloggers if they've attracted guests? Certainly, they have something more nuanced than that. Never rule out the fact that the people making the decision are just wrong. As pointed out, it is a relatively cheap way to be wrong.

 

[tink1]

You know, Dave, I think I wouldn't have such an issue with the way Disney ran these *****-a-thons if they just stopped using the word 'press' ... just remove it and move on to being honest about them.

BTW, it will be telling to see who has invites to this and who doesn't (too bad I won't be here to keep track ... please give @Lee (my wannabe replacement) help with keeping track in my absence.

I find it interesting that Lou is not there. Prior commitments or something else?

 

[Funmeister]

I don't want people worried about the legendary MONSTER that lives in WS lagoon.

Should be plural.

 

[MattM]

Incrementally, the cost of comping a group of bloggers is small but, taken as a whole, the cumulative effect of this type of marketing certainly would be enough to do some wonderful things at WDW.

Agreed, and selfishly I wish they'd pour every dollar of profit P&R makes back into the parks. But I do not blame them one bit for using those dollars otherwise. It's hard to believe, since most of us here go regularly, but a huge percentage of Americans have never taken a Disney vacation (even if all your friends/everybody you know has, its still such a small number). Disney isn't in it just to keep a few bloggers happy, they could shut them down in a heartbeat if they wanted. They're in it because when they send those dollars out, they come back with prisoners.

(of course when I say "you", @ParentsOf4, I mean "you" generally, not you specifically )

 

[Tim_4]

The thing that everyone conveniently forgets is that the "phenomenal" growth was preceded by years of tanking. IOA's previous attendance record was from 2004. Between then and Potter, they consistently lost visitors. It took The Greatest Park Addition in the History of Mankind(TM) to ... get back to where they should have been all along - 3% annual growth from the previous peak.

It's pretty sobering when you look at how poorly Universal has performed long-term. Since the post-9/11 travel hit, WDW attendance growth rate is nearly triple that of Universal (seriously... 2004-2011). The single year attendance record for a Universal park still stands from 15 years ago.

Universal on the whole will be flat this year. They had 4% park revenue growth and the annual report called out the attendance gain being primarily from Transformers in Hollywood. Any gains at IOA will be offset by the losses at USF. People love to praise how fast Transformers went up - the words I heard were "we couldn't afford to have another summer like the last one." Ouch. Taking Jaws out of that park was a big blow.

Watch it. Facts grounded in reality and backed by research are fighting words in these parts. You're exactly right though. It's easy to have high percentage growth when your starting point is borderline insolvency.

 

[Lee]

Never rule out the fact that the people making the decision are just wrong. As pointed out, it is a relatively cheap way to be wrong.

This is what '74 has been saying all along, I believe.

Someone, believed to be a well-paid consultant, sold Disney on the idea of catering to fan bloggers and lifestylers as a means of countering any potential criticism that may arise online. (I cant remember the guy's name, or his exact quote, but it was something about how one positive review can outweigh X number of complaints.)
In essence they are creating a small army of "brand advocates" by wining and dining them, giving free trips and tours, (heavily controlled) access to imagineers, etc.

This is separate from the actual travel industry bloggers that they also court. A legit, high-traffic blog or site that doesn't strictly cater to fans is indeed a wise investment. As Matt said earlier, they can reach a ton of people that otherwise aren't thinking about Disney. That Drummond woman's 13-20 million page views could certainly worth a trip. But what if your site gets less than 100 hits per day, mostly from friends and fellow Disney fans? Why are those folks getting trips and cruises? (Hint: The answer is above.)

 

[Tim_4]

I agree with you to a point. The strategy you mention works but giving bloggers a free trip like that is way overkill to win positive reviews.

The problem with positive Disney blogs are the people who read them are already sold on Disney. The blogs are "great" to give tips and information to guests who have already decided to go to the resort. I cannot imagine too many people who are on the fence about going to WDW or Europe or Yellowstone are swayed by a new hidden Mickey in the Little Mermaid rockwork or showtimes for the EPBOTS (or whatever new "cutting edge" entertainment they are offering these days?).

I think the money spent on these marketing weekends (even though could be considered minimal investment by some) should be spent on attracting new guests not feeding online pep rally's. With this said, I honestly believe this marketing strategy is more ineffective than most believe.

Why spend the money on people who are not necessarily helping gain NEW visits and just giving tips to existing vacations?

I think you underestimate the impact of the blogs. Publications like The Wall Street Journal or CNN have been known to reference these blogs when they report on breaking Disney news. The blogs are the cheapest first stop to get information "out" but that information doesn't stay exclusively in the blogs and therefore blog readers aren't the only end consumers of the information. Also, with new media, people might get news from Google News or another feed that gives equal weight to a StitchKingdom article and a New York Times piece. Heck I've seen articles reference FORUMS, not just blogs, as sources of Disney news.

 

[jt04]

This is what '74 has been saying all along, I believe.

Someone, believed to be a well-paid consultant, sold Disney on the idea of catering to fan bloggers and lifestylers as a means of countering any potential criticism that may arise online. (I cant remember the guy's name, or his exact quote, but it was something about how one positive review can outweigh X number of complaints.)
In essence they are creating a small army of "brand advocates" by wining and dining them, giving free trips and tours, (heavily controlled) access to imagineers, etc.

This is separate from the actual travel industry bloggers that they also court. A legit, high-traffic blog or site that doesn't strictly cater to fans is indeed a wise investment. As Matt said earlier, they can reach a ton of people that otherwise aren't thinking about Disney. That Drummond woman's 13-20 million page views could certainly worth a trip. But what if your site gets less than 100 hits per day, mostly from friends and fellow Disney fans? Why are those folks getting trips and cruises? (Hint: The answer is above.)

If this were true wouldn't I be getting something besides a hard time around here ? I don't even get Disney dollars.