What is Next for Disney for 2013-2019?

[danlb_2000]

In the past, it was assumed that any additional business in Orlando was good for all theme parks, including WDW, because more visitors to the area means more potential customers.

Looks like Potterland changed that as attendance and spending at WDW are flat. Some first time visitors to Potterland also log a day at WDW, but I think what we are seeing now is that families are spending a day at IOA, or maybe 2 considering US, and thus it is cutting into WDW's attendance, and more importantly, folks are saving up to buy Potter wands and other merch, and not on that plush Pooh.

Its kinda sad for WDW given that they have built all of those hotels, but when Potter 2 opens, I see a good chunk of families staying onsite at Universal, and splitting their time between WDW and Universal.

At some point, when they were considering IOA/Potterland, some Uni executives probably walked around WDW, realized the place was raking in the cash without new offerings, and knew that they could compete with Disney. They were right.

Especially with the new hotel being built at Universal which will offer lower price rooms then current onsite hotels.

 

[Jose]

So, WDW will have to reduce its hotels prices... don't you think?

 

[George]

So, WDW will have to reduce its hotels prices... don't you think?

BWAHAHAHAHAHAHAHA! Whooboy. Let me catch my breath. Crazy talk like that gets me every time. I'm gonna have to clean the coffee of my monitor after that spit take.

 

[trr1]

2018??? Seriously? WIll Cars even be relevant by then? Why so long? They built EPCOT in like 2 years (The whole park). So does TDO really think that if they move one truck load of dirt a year then they can call it construction progress and everyone should be happy and excited? By 2018 I would expect Universal to have a ton more options and possibly 1 or 2 more hotels (assuming they have the room).

A group of monkeys and penguins could build that stuff faster.

maybe they will theme the area to the new planes movie a spinoff of cars

 

[Jose]

BWAHAHAHAHAHAHAHA! Whooboy. Let me catch my breath. Crazy talk like that gets me every time. I'm gonna have to clean the coffee of my monitor after that spit take.

Ok, but don't kill me

 

[GoofGoof]

In the past, it was assumed that any additional business in Orlando was good for all theme parks, including WDW, because more visitors to the area means more potential customers.

Looks like Potterland changed that as attendance and spending at WDW are flat. Some first time visitors to Potterland also log a day at WDW, but I think what we are seeing now is that families are spending a day at IOA, or maybe 2 considering US, and thus it is cutting into WDW's attendance, and more importantly, folks are saving up to buy Potter wands and other merch, and not on that plush Pooh.

Its kinda sad for WDW given that they have built all of those hotels, but when Potter 2 opens, I see a good chunk of families staying onsite at Universal, and splitting their time between WDW and Universal.

At some point, when they were considering IOA/Potterland, some Uni executives probably walked around WDW, realized the place was raking in the cash without new offerings, and knew that they could compete with Disney. They were right.

But since Potter opened, attendance at WDW has not decreased:
2007 2011
MK. 17.06. 17.142
EPCOT. 10.93 10.825
DHS. 9.51. 9.783
AK. 9.49 9.699
Total. 46.99. 47.449

The growth is basically flat, but the opening of Potter did not cut into attendance. They did not take the big hit that many people expected/assume. Very little was added to WDW in those 5 years, but they maintained attendance. IMHO that is partially due to guests who visited Orlando for Potter and still spent some time at WDW. The room occupency rates are down some, but not enough to be considered a big hit. I know those numbers can be manipulated by taking rooms out of service, but since Potter opened Disney has added several thousand rooms to the inventory so even if they took others out of service it evens out. It is possible that when Potter 2.0 opens and the additional resorts at Universal open this trend will change, but it didn't with original Potter even though IOA had 30%+ growth in attendance. The one area that WDW has to be taking a hit on is merchandise. The quality of offerings has gone down hill while Universal has been pumping out Potter goods.

 

[GoofGoof]

We went to ORL last month and spent 5 days and 4 nights at Loews on property and exclusively visited IOA and USO, so that's not the case. I know of many others that have done the same and some have done the combination of Universal & SeaWorld over a week all the while skipping over Disney.

At this point, based upon the lack of attractions, modernization, etc., only one Disney park would qualify as more than a day trip.

My statement was more of a generalization and I know people do go to Orlando without visiting Disney. It is definitely not as common to go for a week and only visit Universal as it is for WDW. I would disagree on the day trip point. I really only see MK as a viable day trip option. Maybe EPCOT. No way would I pay $90 for a day trip to DHS or AK. With multi-day passes most visitors to Disney aren't on day trips anyway. The pricing is set up to encourage you to stay for 5 to 10 days.

 

[Jose]

If I go to Orlando, I'll see WDW before going to Universal!!!!!!!!!!

 

[GoofGoof]

If I go to Orlando, I'll see WDW before going to Universal!!!!!!!!!!

Me too, but it sure is getting close.

 

[wdwfan4ver]

Here's a bad scenario for WDW fans: Disney is obviously building in emerging markets, in China, and in established markets with few theme park options, Hong Kong Disneyland.

What if Potterland is so good that Burbank figures that WDW can *never* compete with Universal Orlando over the next 15-20 years (in terms of growing the customer base significantly), and that their best bet in Orlando is to shore-up niche areas like princess meet and greets, instead of doing something big and bold?

If so, Disney might continue to spend at international parks, maybe buy Paris Disneyland outright, and start planning on Disneyland Brazil . . . might be a while before WDW sees a major E-Ticket.

I agree with you on WDW. There is a catch with what you are saying with the international parks Disney has though. I don't know about Brazil happening, but two the parks internationally that are already open has issues and Disney is trying to fix the issues.

Disney is doing stuff with Hong Kong Disneyland right now because the park hasn't met exceptions for attendance yet and only now has started to make a profit.

Disney also is going stuff with Walt Disney Studios Park because the attendance is the worst of all Disney parks that Disney has world wide and all of us know about how Disneyland Paris is doing from a money standpoint. There is rumors of a Marvel Land and a Star Wars land at Walt Disney Studios Park because of how bad attendance is over there.

WDW right now has no attendance problems or money problems. What Universal does with their two parks in how you force Disney to do something.

 

[wdwfan4ver]

So, WDW will have to reduce its hotels prices... don't you think?

That will happen the day pigs start to fly.

 

[Jose]

That will happen the day pigs start to fly.

LOL! I was just dreaming...

 

[Jose]

Me too, but it sure is getting close.

Well, I think that Potterland is a very important fact...

 

[GoofGoof]

Well, I think that Potterland is a very important fact...

Yep. And pretty much everything since. I think building Potter gave Universal the courage and confidence to build more and shoot for the stars. Reminds me of WDW in the 80s into the 90s where every time you went back there was something new that topped last year's adds. If they can dream it they will try to build it. Potter 2.0 with the train station and Gringotts should be amazing.

 

[Pixiedustmaker]

But since Potter opened, attendance at WDW has not decreased:
2007 2011
MK. 17.06. 17.142
EPCOT. 10.93 10.825
DHS. 9.51. 9.783
AK. 9.49 9.699
Total. 46.99. 47.449

The growth is basically flat, but the opening of Potter did not cut into attendance. They did not take the big hit that many people expected/assume. Very little was added to WDW in those 5 years, but they maintained attendance.

A question is what would WDW's attendance have been had Potterland not opened? Just with population growth and a recovering economy, WDW was forecasting a conservative 1% growth in attendance. For the years between 2007 and 2011 you'd expect attendance to increase by 1% annually from about 47 million in 2007 to 48.9 million in 2011/2012. So you can see that Potterland may very well be cutting into WDW attendance forecasts with growth remaining flat.

The embarassing issue for Disney is that there is this large untapped market of millions of customers wanting to go to Orlando to see something amazing, and Disney "missed" them, as Potterland prove they exist and want to be wowed.

 

[Pixiedustmaker]

I agree with you on WDW. There is a catch with what you are saying with the international parks Disney has though. I don't know about Brazil happening, but two the parks internationally that are already open has issues and Disney is trying to fix the issues.

Disney is doing stuff with Hong Kong Disneyland right now because the park hasn't met exceptions for attendance yet and only now has started to make a profit.

Disney also is going stuff with Walt Disney Studios Park because the attendance is the worst of all Disney parks that Disney has world wide and all of us know about how Disneyland Paris is doing from a money standpoint. There is rumors of a Marvel Land and a Star Wars land at Walt Disney Studios Park because of how bad attendance is over there.

WDW right now has no attendance problems or money problems. What Universal does with their two parks in how you force Disney to do something.

But the money for improving properties, such as Hong Kong (built too small), Disneyland Paris Resort (Walt Disney Studios Park small and cheap), and for building a new park in Shanghai to take advantage of China's emerging middle class all come fromt the same pot of money.

Obviously, WDW doesn't have a bank account somewhere were $$ is saved up for refurbs and new lands, if they did it would have billions in it, instead this money goes to corporate, and is used, in part to shore up lackluster films like John Carter and to build cruise ships.

Disney can't be "forced" to do something with WDW, if they think they can get a higher return on their investment at WDW then they'll invest more, if it gets bad like DCA where the parks hurt the brand and other areas of business then they'll invest more. Right now WDW isn't as bad as DCA 1.0 was, there are still quality attractions, it just doesn't have that "wow" factor due to poor upkeep and a lack of quality attractions.

The billions to build Shanghai had to come from somewhere, and yes, part of it is from revenue at WDW.

 

[MattM]

The embarassing issue for Disney is that there is this large untapped market of millions of customers wanting to go to Orlando to see something amazing, and Disney "missed" them, as Potterland prove they exist and want to be wowed.

This is a good point. I see here a lot something along the lines of "everyone who will come has come" etc. Or, "I know a lot of people who say they won't do this or that." The fact of the matter is, no matter how many people you think you know, it is such an insignificantly small amount and narrow demographic sample that it can, in no way shape or form be applied to any trend that a company is seeing.

Pixiedustmaker has it right. There is a massive market out there that can still be obtained by Disney, if they want.

 

[DManRightHere]

Sure, the economy would be boosted. But the products sold would likely cost twice as much.

As terrible as it is, companies build overseas because it means they can save money on labor and ultimately do two things: decrease product pricing and add to their profit margins. Ideally, business will lean more on the former and less on the latter. Doesn't always work out that way though...

So the question is, would you rather have lower cost (and potentially lower quality) products, or higher cost (and slightly better quality) products?

It may cost more, but not double (For disney). Disney should eat the dollar or two profit (even though they won't) knowing the money could come right back to them.

American companies can only be so cheap and automate everything. If they don't pay anyone for anything, how do they expect local consumers to buy their products or services? But American consumers do not want to pay a little more. It's a nasty loop to think about.

 

[CinematicFusion]

I think Disney feels they don't need to build, let the other companies build...and people will still come to Disney. As many have said on this board, the numbers don't show a dramatic drop in attendance...so Disney doesn't need to build rides, they just need to build more shops, restaurants, hotels to get the revenue.

Why build an eticket ride if it doesn't dramatically increase attendance across the board?
So far NFL hasn't brought the numbers Disney expected. I don't think Disney is in any hurry to do anything.

 

[GoofGoof]

A question is what would WDW's attendance have been had Potterland not opened? Just with population growth and a recovering economy, WDW was forecasting a conservative 1% growth in attendance. For the years between 2007 and 2011 you'd expect attendance to increase by 1% annually from about 47 million in 2007 to 48.9 million in 2011/2012. So you can see that Potterland may very well be cutting into WDW attendance forecasts with growth remaining flat.

The embarassing issue for Disney is that there is this large untapped market of millions of customers wanting to go to Orlando to see something amazing, and Disney "missed" them, as Potterland prove they exist and want to be wowed.

We will never know the answer to that for sure. If Potter never opened would overall Orlando tourism have been lower? Most definitely yes. The impact for IOA is easy to quantify. The impact on WDW not so much. Without Potter and without anything new or exciting at WDW maybe WDW attendance would be down instead of up a mild 1%. It is definitely an interesting debate and I can see both sides of the issue. The truth is probably a combination of both. WDW lost guests to a few days visiting Potter and they also got some return guests who would not have been in Orlando if it wasn't for Potter.

Disney is tapping into some of those millions of customers out there in other countries like Brazil. Locals and more regular visitors who may be "turned off" by a lack of new attractions and are turning to Universal or Sea World as alternatives are being replaced by other new customers in some cases keeping attendance flat.