The Spirited Sixth Sense ...

[WDW1974]

Fun With Tweets (Price Hike Addition):

E. Cardon Walker ‏@ECardonWalker 24m
Media Geniuses. RT @ThemePark: So did Disney World just announce a price increase during a Universal Orlando press event? #mostimpressive

Rikki Niblett ‏@RikkiNibs 1h
surprised to see the WDW ticket increase mostly because I would think Disney wouldn't want the next increase to be over the harsh $100 mark

Root ‏@servoisnaked 2h
WDW justifies price hike saying "We have to fix the tiki dude's arm. Don't want him to remind people of the drummer for Def Leppard"

IndyandMarion ‏@IndyandMarion 2h
Anyone who is shocked by the price hike at WDW tomorrow needs to be tickled on the with a feather duster.

Sean ‏@Parkscope_Sean 2h
WDW justifies their price hike with the "ongoing commitment in expanding their offerings". LOLZ

Superior SpiderMearn ‏@mearn 38m
On nights like tonight I become very concerned that Jimmy Thick isn't trolling

CM87 Esq. ‏@CaptMichael87 1h
For 2 days at MK, I get a year at UOR.

Brandon ‏@DCAlover 2h
It still makes me physically ill to think that Magic Kingdom is far more money than Tokyo Disneyland.

Todd Dupler ‏@ToddDupler 2h
@Parkscope_Sean @AmyBethCombs @AlaskaDisneyGrl @WonderlandNerds I think the hotel prices are more out of whack than the park prices.

 

[ford91exploder]

We've become so passive and just settle for less that we tend to complain the same way too. Nothing beats a good phone call up the ladder. Yet we would rather tweet to our 35 followers we went to school with than pick up a phone. The company I work for scrambles to accommodate twice as fast if someone calls the boss. But Disney fans (including myself at times) tend to just ignore it to try and keep the magic alive. The magic is dying and we aren't helping.

I've called, written letters etc TDO no longer CARES that we had a poor experience, I will not bore people with another retelling of my 2 horrible experiences in 2013 with MM+

What do you do then???

 

[ParentsOf4]

So, a late Saturday price increase on tickets for tomorrow.

Disney promised its Board an 11 percent increase on revenues for NGE by third quarter of 2013. No impact on financials. Disney expects no net gain for any of 2014. Disney keeps insisting it is still in testing, even though that makes every guest an unwilling guinea pig. Bob Iger gets angry and can't answer analyst questions regarding when the $2 billion-plus boondoggle will pay off (or how).

Yes, sometimes 2+2=4.

Disney's surprise ticket price increase has me thinking about just how badly they've been running Parks & Resorts (P&R) for over a decade.

Today’s Disney is living off investments made in the past.

There’s nothing wrong with reaping the benefits of prior investments. There’s nothing wrong with properly managing future investments.

The problem is that Disney has underinvested in WDW for far too long while making poor choices with their other P&R investments.

In 2000, P&R realized an operating income of $1.6B on revenue of $6.8B.

Last year, P&R achieved an operating income of $2.2B on revenue of $14.1B.

Revenue up 107%, operating income up 38%.

It doesn’t sound like corporate Disney has managed its P&R money smartly, does it?

Then there’s the problem with P&R investments.

Between 2000 and 2013, Disney invested almost $20B in P&R. Sounds like a lot right?

Not really.

Let’s recall what CFO Jay Rasulo said about capex in 2011:

“Five years ago or so we used to be pretty demonstrative about $1 billion number being an ongoing level without special projects added to it.

You have to remember though that in those five years in the capital projects that we have put in the ground, which each have their own growth strategy, each is filling in different parts of the portfolio, when they are back on board they all need ongoing FF&E and maintenance capital to keep them going.

So I would say that that $1 billion number is low.”​

In other words, back in 2006, Disney was spending $1B in capex for routine maintenance of its facilities “without special projects”.

As Rasulo mentioned, additional projects have been brought online, requiring additional capex dollars in order to maintain those assets.

Taking into account additional assets and inflation since 2006, baseline capex is at least $1.5B today, probably more.

Most of what Disney calls “investments” is simply the cost of maintaining its tremendous facilities.

If we focus on true P&R investments over the intervening years, about $5-7 billion has been spent at DCA, Hong Kong Disneyland, 2 cruise ships, DVC, MyMagic+, and Shanghai Disneyland.

Beyond basic maintenance and the MyMagic+ fiasco, WDW’s theme parks have received only a pittance of true investment capital since 2000.

Unless you want to count the 6 DVC resorts built since 2000, with another on the way.

Since 2000, P&R revenue has more than doubled, up 107%.

We know exactly where most of that revenue is coming from.

Prior to the latest increase, a one-day ticket at WDW had increased from $46 to $95, up 107%.

What a coincidence.

WDW food, beverage, merchandise, hotel, and timeshare prices are up similar amounts.

Yet operating income is up only $600M despite steep investments elsewhere.

Doesn’t sound like corporate Disney has been investing wisely, does it?

Those running P&R really are looking like they have no clue how to run their segment.

Yet we still have defenders of their decisions such as MyMagic+. And we all know that letting J.K. Rowling walk was their smartest move ever, right?

Well, at least it was for Universal.

Meanwhile, we’ve had a decade of penny-pinching by management at WDW. All that cheapness has produced what?

Worse results than back in 2000 when the company was more focused on providing a quality product at WDW.

In their rush to pick up pennies, Disney leadership is letting the dollars fly right over their heads.

 

[Nemo14]

We've become so passive and just settle for less that we tend to complain the same way too. Nothing beats a good phone call up the ladder. Yet we would rather tweet to our 35 followers we went to school with than pick up a phone. The company I work for scrambles to accommodate twice as fast if someone calls the boss. But Disney fans (including myself at times) tend to just ignore it to try and keep the magic alive. The magic is dying and we aren't helping.

I've written quite detailed letters and just get phone calls in return from some bimbo who can only speak using key Disney-approved words who tries to convince me that Disney really cares about my opinion.

 

[KYWDW]

I've called, written letters etc TDO no longer CARES that we had a poor experience, I will not bore people with another retelling of my 2 horrible experiences in 2013 with MM+

What do you do then???

Plan a trip to Universal like I am this fall! lol. Maybe Disney will wake up when all the DVCr's are driving off property everyday. Doubt it tho. Our one horrible experience ended with a 3 year disney hiatus.

 

[ford91exploder]

Disney's surprise ticket price increase has me thinking just how badly they've been running Parks & Resorts (P&R) for over a decade.

Today’s Disney is living off investments made in the past.

There’s nothing wrong with reaping the benefits of prior investments. There’s nothing wrong with properly managing future investments.

The problem is that Disney has underinvested in WDW for far too long while making poor choices with their other P&R investments.

In 2000, P&R realized an operating income of $1.6B on revenue of $6.8B.

Last year, P&R achieved an operating income of $2.2B on revenue of $14.1B.

Revenue up 107%, operating income up 38%.

It doesn’t sound like corporate Disney has managed its P&R money smartly, does it?

Then there’s the problem with P&R investments.

Between 2000 and 2013, Disney has invested almost $20B in P&R. Sounds like a lot right?

Not really.

Let’s recall what CFO Jay Rasulo said about capex in 2011:

“Five years ago or so we used to be pretty demonstrative about $1 billion number being an ongoing level without special projects added to it.

You have to remember though that in those five years in the capital projects that we have put in the ground, which each have their own growth strategy, each is filling in different parts of the portfolio, when they are back on board they all need ongoing FF&E and maintenance capital to keep them going.

So I would say that that $1 billion number is low.”​

In other words, back in 2006, Disney was spending $1B in capex for routine maintenance of its facilities, “without special projects”.

As Rasulo mentioned, additional projects have been brought online, requiring additional capex dollars in order to maintain those assets.

Taking into account additional assets and inflation since 2006, baseline CapEx is at least $1.5B today, probably more.

Most of what Disney calls “investments” is simply the cost of maintaining its tremendous facilities.

If we focus on true P&R investments over the intervening years, about $5-7 billion has been spent at DCA, Hong Kong Disneyland, 2 cruise ships, DVC, MyMagic+, and Shanghai Disneyland.

Beyond basic maintenance and the MyMagic+ fiasco, WDW’s theme parks have received only a pittance of true investment capital since 2000.

Unless you want to count the 6 DVC resorts built since 2000, with another on the way.

Since 2000, P&R revenue has more than doubled, up 107%.

We know exactly where most of that revenue is coming from.

Prior to the latest increase, a one-day ticket at WDW has increased from $46 to $95, up 107%.

What a coincidence.

WDW food, beverage, merchandise, hotel, and timeshare prices are up similar amounts.

Yet operating income is up only $600M despite steep investments elsewhere.

Doesn’t sound like corporate Disney has been investing wisely, does it?

Those running P&R really are looking like they have no clue how to run their segment.

Yet we still have defenders of their decisions such as MyMagic+. And we all know that letting J.K. Rowling walk was their smartest move ever, right?

Well, at least it was for Universal.

Meanwhile, we’ve had a decade of penny-pinching by management at WDW. All that cheapness has produced what?

Worse results than back in 2000 when the company was more focused on providing a quality product at WDW.

In their rush to pick up pennies, Disney leadership is letting the dollars fly right over their heads.

THIS - How can I like this post at least 10 million times!!!!

 

[jt04]

Finally a solid strategy to thin out the crowds. I might have to plan a visit.

 

[jt04]

See Rock City

 

[Goofyernmost]

The holiday inn has lights out too. This is the Grand Floridian Resort and Spa. The flagship resort of WDW, and that's how you want to present it aesthetically?

It doesn't matter if you don't stay there. We don't either. But it's another example that Disney just doesn't care about the little things anymore.

I agree if it is a totally inexcusable case of just ignoring it. I am always one that needs to know the reasons. It isn't really in harmony with the rest of the place. Sure, a bulb here and there, but strings of them ignored this long? Maybe you're all right about it, I have no way of knowing, but something isn't lining up properly. I have to ask myself why! Why that one place and not the entire resort. Look at the numbers of lights installed in the new bus stops at MK. They are as visible as GF, and they installed thousands of them. Why would they even have bothered to design them in if it isn't policy to take care of fixing them if they go out. I am bewildered and the mere thought that this is how the whole complex is run, just doesn't ring true to me.

 

[ford91exploder]

I've written quite detailed letters and just get phone calls in return from some bimbo who can only speak using key Disney-approved words who tries to convince me that Disney really cares about my opinion.

Obviously we got the same Bimbo who only made me angrier,

If they had a Lilly Tomlinson doing the 'phone lady' - We are TWDC we don't HAVE to care about your problem. I think in a strange way I would have been happier because then I would know that TWDC just does not give a damn and I could make decisions accordingly,

But putting some bimbo who is not smart enough even to successfully patronize me just makes me furious.

 

[Goofyernmost]

I owe you a drink of your choice at WDW for this post ... I swear the Disney fan community is going to drive me insane.

Short trip!

 

[Nemo14]

Obviously we got the same Bimbo who only made me angrier,

If they had a Lilly Tomlinson doing the 'phone lady' - We are TWDC we don't HAVE to care about your problem. I think in a strange way I would have been happier because then I would know that TWDC just does not give a damn and I could make decisions accordingly,

But putting some bimbo who is not smart enough even to successfully patronize me just makes me furious.

we need to compare notes. Did your Bimbo tell you that GeorgeK read your letter and asked her to give you a call....on your cellphone....when you had not mentioned your cellphone # in your letter?

 

[ford91exploder]

I agree if it is a totally inexcusable case of just ignoring it. I am always one that needs to know the reasons. It isn't really in harmony with the rest of the place. Sure, a bulb here and there, but strings of them ignored this long? Maybe you're all right about it, I have no way of knowing, but something isn't lining up properly. I have to ask myself why! Why that one place and not the entire resort. Look at the numbers of lights installed in the new bus stops at MK. They are as visible as GF, and they installed thousands of them. Why would they even have bothered to design them in if it isn't policy to take care of fixing them if they go out. I am bewildered and the mere thought that this is how the whole complex is run, just doesn't ring true to me.

Different projects and different budgets, The new lights come from the construction budget, GF comes from resorts and the GF is the same resort which refuses to order enough chips to meet guest demand because what happens if we don't sell all of them, Better the guests at the flagship resort go without then...

Just pathetic

 

[ford91exploder]

we need to compare notes. Did your Bibo tell you that GeorgeK read your letter and asked her to give you a call....on your cellphone....when you had not mentioned your cellphone # in your letter?

Yep, But since cellphone is part of resort check in to send you text when room is ready it was not all that surprising Plus I'm long term DVC so TDO knows all my contact information anyway.

 

[kagacins]

These types of charts are out there, but here is one I've put together including information regarding the latest ticket price increase to $99 for the Magic Kingdom from today (for the 1 day, 1 park ticket). It is an analysis of Magic Kingdom ticket price increases vs. inflation. The ticket price data comes from AllEars, so many thanks for that. The baseline year for my analysis is 1983 (I think the first full year changeover away from ticket books to All-Access tickets). There are a few basic assumptions (like inflation for 2014 will equal inflation for 2013) and a slight simplification of the average Magic Kingdom ticket price for each year, but the basic message is pretty straightforward. In most years, Disney increases the the ticket price by about 5% more than inflation. Factored all together, Disney has cumulatively exceeded the pace of inflation relative to 1983 by 375%. Yowzah. I have not done much benchmarking for comparative analysis (i.e. how have other parks compared to inflation), but I could certainly try that if there is enough interest (and if I can readily access historical ticket prices for other parks). I hope this helps to add a little context to some of the pricing discussions, as well as some additional fodder for the cannon of "is the value really there?" Me, I love my times at The World, but graphs like this definitely put a little cloud over Cinderella's Castle. Let me know if you have any questions!

 

[WDW1974]

I've written quite detailed letters and just get phone calls in return from some bimbo who can only speak using key Disney-approved words who tries to convince me that Disney really cares about my opinion.

There is one woman who does a lion's share of that crap. I dealt with her once just to hear her do her act ... I wish I could recall her name right now. Been with WDW since the late 70s she says, she plays on you based on where you live, your age, your history with Disney in a sugary sick condescending way.

I realized how popular she was when I typed her name into Google. It seemed like everyone in the online fan community who had ever contacted Disney had dealt with her.

 

[WDW1974]

Finally a solid strategy to thin out the crowds. I might have to plan a visit.

Why start now?

 

[jt04]

Why start now?

I go when something significant has been added to each park.

Just waiting for new FotLK, and some of the other new adds at DAK. Especially Pandora but I may go before then. See you at DAK on Pandora's opening day for sure.

 

[jdmdisney99]

Why start now?

Because he has to book his FastPasses while they're still available.

 

[nor'easter]

I go when something significant has been added to each park.

e.

So I guess you haven't been in quite a while...